Q3 2025 Lundin Mining Corp Earnings Call

Speaker #2: Mute .

Speaker #3: Unmute . Good day . Yea . Thanks for standing by . Welcome to the Lundin Mining CORP . Third quarter 2020 Financial Results conference call .

Speaker #3: At this time , all participants are in a listen only mode . After the speaker's presentation , there will be a question and answer session .

Speaker #3: To ask a question during the session , you will need to press star one one on your telephone . You will then hear an automated message advising your hand is raised .

Speaker #3: To withdraw your question , please press star one one again . Please be advised that today's conference is being recorded . I would now like to turn the conference over to Jack Lundin president and CEO of Lundin Mining CORP .

Speaker #3: Please go ahead .

Speaker #4: Welcome to our third quarter 2025 conference call . The financial results , press release and presentation are on our website , where you can also find a replay of this call .

Speaker #4: All figures today are in US dollars unless stated otherwise . After the presentation , we'll open the floor to questions . Today's webinar will include forward looking statements that involve risks and uncertainties .

Speaker #4: Please review the cautionary notes on slide two and the disclaimer in our DNA . With me today is our chief Operating Officer , Juan Andres Morrell , and our Chief Financial Officer , Teitur Poulsen , to discuss our Q3 operating and financial results .

Speaker #4: Touching on the highlights from the quarter , consistent operational performance continues to drive solid financial results , which I'll briefly summarize on the next slide .

Speaker #4: And Juan , Andrés and Tyler will provide additional detail shortly . We've tightened our production guidance ranges , increased copper guidance , and reduced cost guidance , reflecting the strength and stability of our operations .

Speaker #4: We continue to advance the vicuna opportunity during the quarter , given the positive momentum and many working fronts that are progressing well against the baseline plan .

Speaker #4: We felt it was the right moment to further strengthen the management team . Effective tomorrow . Ron Hochstein will be leaving London Gold to join Dave Daycare in the rest of the Vicuna Core team , where he will support as chief executive officer of the joint venture .

Speaker #4: Ron joins a group of familiar former colleagues , many of whom were involved on the successful project phase of the Del Norte gold mine in southern Ecuador .

Speaker #4: Currently owned and operated by Lundin Gold . Together , the team will look to build on a successful track record by bringing the Vicuna project towards a sanctioned decision and ultimately development and operations .

Speaker #4: Our operational success goes hand in hand with our safety performance . In the first nine months of the year . We're pleased to report no major injuries across any of our operations and a total recordable , injury frequency rate of 0.29 , the lowest in the company's last ten years .

Speaker #4: This achievement underscores our commitment to risk management and the effectiveness of our proactive improvements to critical controls . Lastly , as we outlined at our Capital Markets Day in June , we're advancing several near and mid-term growth opportunities across each of our three Latin American operations .

Speaker #4: One key initiative relates to the cathode growth opportunity , and I'll provide an update on that towards the end of today's presentation . On the next slide , we're pleased to announce that the third quarter was the best quarter year to date by most metrics .

Speaker #4: We're seeing the benefits of a simplified portfolio , full potential initiatives , and disciplined planning . And the execution of our plans are paying off now .

Speaker #4: Copper production for the quarter totaled 87,400 tons , primarily driven by a strong performance at Kasarani from higher copper grades and elevated cathode production .

Speaker #4: As a result , we have increased annual copper guidance by approximately 11,500 tonnes in the midpoint . The new guidance range is 319,000 to 337,000 tonnes of copper , improving by about 3.5% .

Speaker #4: When you compare the midpoint , gold production was in line with the last quarter at 38,000oz , and year to date we are tracking to achieve our full year guidance .

Speaker #4: During the quarter , we produced copper at a consolidated cash cost of $1.61 per pound , benefiting from stronger gold prices and cost reduction efforts .

Speaker #4: At our assets through our full potential programs . We have since lowered cost guidance to $1.85 to $2 a pound and tightened our production ranges on several of our assets as we enter the final quarter of the year .

Speaker #4: We will provide details on guidance improvements later in this presentation and on the operational financial performance. We delivered over $1 billion in revenue in Q3, making it one of the strongest quarters in the company's 30-year history.

Speaker #4: And we generated approximately 490 million in adjusted EBITDA and 383 million in adjusted operating cash flow . We also declared our 38th regular quarterly dividend , highlighting our commitment to financial discipline and shareholder returns .

Speaker #4: There were no share buybacks in the quarter . Year to date , we've purchased or repurchased 12.6 million shares for approximately 104 million USD at an average price of Canadian 11 $0.70 per share , with about 45 million remaining under our 150 million buyback program , subject to market conditions , we intend to complete the buybacks before the end of this year .

Speaker #4: However , any shares that are not purchased will be turned into a special dividend , ensuring we deliver on our 220 million total annual return target .

Speaker #4: I would now like to invite Juan Andres , our chief operating officer , to discuss our production results for the quarter .

Speaker #5: Thank you , Jack , and good morning , everyone . Our assets continue to perform well and the focus in increasing our operational discipline is correlating to strong safety and production results .

Speaker #5: As mentioned earlier , we increased copper guidance , and I will discuss that later on . Copper production for the company was 87,400 tons for the quarter , at 244,200 tons year to date , which puts us in a comfortable position to meet our increased guidance range for the year of 319,000 to 337,000 tons of copper , gold production for the quarter totaled 37,800oz and 107,700oz year to date , the company's position well , going into the end of the year and tracking to production guidance on consolidated basis for copper , gold and nickel for 2025 at Candelaria , copper production for the quarter totaled 37,000 tons , along with 19,900oz of gold .

Speaker #5: Candelaria continues to be extremely consistent . This year . Softer ore from phase 11 led to higher throughputs in the mill , which processed 8.1 million tonnes of ore during the period .

Speaker #5: This is the highest throughput in a quarter in the last five years , and the second highest quarter for throughput . Since we have owned the asset .

Speaker #5: Year to date , Candelaria has produced 111,000 tons of copper and 61,500oz of gold , which puts Candelaria well on track to meet guidance for the year .

Speaker #5: We anticipate production levels in the fourth quarter at Candelaria to be in line with Q3 at copper production reached 35,300 tons in Q3 , one of the strongest , strongest quarters since we have owned the asset year to date , it has produced 93,300 tons .

Speaker #5: As mentioned last quarter , the asset is second half weighted . Head grades have improved in the second half of the year and should continue through Q4 , putting us on track to meet guidance .

Speaker #5: Cathode production continued to outperform expectations , but in line with what we announced in June during our capital Markets Day , a total of 6300 tons of copper cathodes was produced in the quarter , driven by increased material placed on the leach pads and improved irrigation practices .

Speaker #5: We have updated the Hydrometallurgical model for the dam leach and anticipate cathode production for the full year to be approximately 24,000 tons , which is higher than what we have planned at the beginning of the year .

Speaker #5: The strong cathode production has led us to increase overall guidance for cascarones and tighten the range . The new copper guidance is forecast to be 127,000 to 133,000 tons for the full year at cascarones in the quarter , Chapada produced 12,600 tons of copper and 17,900oz of gold production at Chapada continues to be weighted toward the second half of the year and fourth quarter production should be in line with Q3 at Eagle Mine , nickel production was 2700 tons and copper production was 2400 tons .

Speaker #5: For the quarter . Mill throughput was strong at 183,000 tons , which was the highest quarterly throughput in the last two years . Eagle is tracking to guidance and is expected to be within 9011 thousand tons of nickel , and within 9010 thousand tons of copper for the year .

Speaker #5: Year to date , operations have been performing well . Strong cathode production and throughput at Casa has led to a guidance increase for approximately 10,000 tons .

Speaker #5: As mentioned , the new guidance range for Calzedonia is now 127,000 to 133,000 tons , with increased confidence going into the end of the year , we have tightened the guidance ranges for Candelaria and Eagle .

Speaker #5: The new copper guidance range for Candelaria is 143,000 to 149,000 tons , and for Eagle is 9000 to 10,000 tons of copper . Consolidated copper production guidance range is now 319,000 to 337,000 tons of copper , an improvement of approximately 11,500 tons to the midpoint of the guidance .

Speaker #5: Consolidated gold production guidance is now 100 , 135,000 to 146,000 , representing a tightening of the range for improved confidence at Candelaria and Chapada .

Speaker #5: Overall , we're in a good position entering the fourth quarter with improved guidance and consistency from our operations . We are tracking to reach the midpoint for our guidance for all metals .

Speaker #5: I will now turn the call over to Tyler to provide a summary of our financial results. Thank you for your attention.

Speaker #5: Thank you and good morning , everybody . I'm very pleased to be able to present a strong financial quarter for the company . The company's financial performance was supported by strong operational results as has just now presented , coupled with favorable copper and gold prices .

Speaker #5: These factors enabled the company to achieve another quarter of strong financial performance. The revenue for the quarter came in at $1 billion, with our revenue remaining heavily weighted towards copper, which accounted for 79% of the revenue mix.

Speaker #5: Gold and nickel contributed 13 and 3% , respectively , with the price of gold hitting all time highs . We have seen our gold revenue contribution climb by about 2 to 3 percentage points during the quarter .

Speaker #5: Our Chilean mines Candelaria and Casabona generated 74% of the company's revenue in combination with Chapada in Brazil , operations in South America represented 95% of total revenue .

Speaker #5: Looking at volumes sold , inventory levels of concentrate and realized pricing during the period we sold approximately 79,000 tons of copper at a realized price of $4.61 per pound , which is slightly better pricing than the average LME spot price for copper during the period .

Speaker #5: As disclosed in our press release in October , we incurred a shipment delay of approximately 20,000 tons of copper concentrate at Kasarani due to weather related impacts at the port of totara Leo .

Speaker #5: This has resulted in company carrying higher than normal inventory levels at the end of Q3 . This elevated level of inventory is expected to unwind during Q4 and thus having the revenue and cost of goods sold associated with this inventory to be recorded in the fourth quarter 2025 .

Speaker #5: Provisional pricing impact . In the third quarter was positive by $11 million , primarily driven by gold ounces that settled in the quarter .

Speaker #5: The realized gold price during the quarter was just below $3,900 per ounce. At the end of the quarter, 78,000 tonnes of copper were provisionally priced at $4.65 per pound, and 34,000 oz of gold were provisionally priced at $3,800 per ounce and remain open for final pricing adjustments.

Speaker #5: In Q4 . Turning to slide 14 . Production costs totaled $490 million for the quarter , consistent with the past few quarters at Candelaria , total costs were higher compared to previous quarters due to higher mining costs and higher ore milled during the period , and due to reclassifying certain stripping costs from sustaining CapEx to production costs .

Speaker #5: Cash costs have continued to benefit from strong gold prices and remain in the $1.90 range for the full year . We reiterate the cash cost guidance of $1.80 to $2 per pound for Candelaria Corona .

Speaker #5: Costs for the third quarter are lower than normal due to inventory build relating to the deferred shipment of concentrate into the fourth quarter , representing approximately $20 million in costs associated with this delay .

Speaker #5: Costs in the third quarter also benefited from certain one off credit notes from certain suppliers , and due to a new and more cost effective equipment maintenance contract .

Speaker #5: Total costs were in line with expectations of $158 million for the quarter . When adjusted for the above mentioned items . Cash costs were $1.86 per pound and benefited from better TCR terms , stronger cathode production , and byproduct credits , as well as lower contract costs .

Speaker #5: As mentioned earlier , we expect cash costs in the fourth quarter to continue to benefit from strong cattle production and by product pricing , and have lowered our guidance range for Casarano to between $1.15 to $2 $0.15 to $2.25 per pound .

Speaker #5: Representing an approximate $0.30 per pound decrease . Total costs for the third quarter amounted to $96 million , reflecting higher mill throughput during the quarter and volumes sold .

Speaker #5: C1 costs continued to decrease compared to prior periods and came in at $0.50 per pound for the quarter , primarily due to higher byproduct credits from gold prices .

Speaker #5: We are reducing the full year cost guidance range again to $0.90 to $1 per pound from the previous guidance range of 110 to 130 per pound on a consolidated basis , our C1 costs for the quarter was $1.61 per pound , well below our full year guidance range of 1.95 to $2.15 per pound , based on the adjustments mentioned above , we are .

Speaker #5: As previously mentioned , reducing our consolidated cash cost guidance range to $1.85 to $2 per pound for the full year . Total capital expenditure , including both sustaining and expansionary investment , was 160 million for the quarter and 485 million for the nine months of the year .

Speaker #5: Full year guidance for the total capital expenditure has been revised down by 45 million to 750 million due to a deferral of projects at Candelaria and Casa , as well as reclassifying some of the capitalized stripping costs accounting area to production costs for sustaining capital , we expect spending to increase going into the fourth quarter to reflect the roughly 170 million that remains to meet guidance for the full year , as we , Cunha capital expenditure during the quarter was 51 million and year to date , 126 million and is tracking to guidance of 250 million for the full year .

Speaker #5: Q3 expenditure was primarily focused on field activities for water program drilling , trade off studies , engineering , cost estimation and permitting in preparation for the Integrated technical study .

Speaker #5: In the first quarter of 2026, our key financial metrics for the third quarter are presented on slide 16. Adjusted EBITDA for the quarter was $490 million, with a 49% margin.

Speaker #5: Adjusted operating cash flow for the quarter totaled 383 million , and for the first nine months , totaled just below 1 billion , including cash tax payments of close to $300 million .

Speaker #5: The company achieved solid free cash flow from operations of 169 million . Despite the impact of 113 million working capital build during the quarter , adjusted earnings amounted to 155 million for the quarter , which translates to an adjusted EPs of $0.18 .

Speaker #5: An improvement of 64% from last quarter . Turning to cash generation during the third quarter , we entered the quarter with around 279 million in cash and a net debt position of 135 million .

Speaker #5: We generated adjusted operating cash flow of 383 million after cash tax payments of 86 million , and incurred our working capital build of 113 million .

Speaker #5: The sustaining Capital investment amounted to 109 million , which resulted in free cash flow from operations for the quarter of 169 million . We had total shareholder distributions of 43 million during the quarter , of which 17 million related to the payment of regular dividends after debt leasing and interest payments , as well as the deferred payment of 10 million relating to hour acquisition .

Speaker #5: We ended the quarter with with cash of around 219 million and a net debt position of 108 million , excluding lease liabilities , by the end of the year , we expect to be essentially net debt free .

Speaker #5: We continue to advance the process to increase our revolving credit facility as part of our strategy to fund future growth plans , we have a number of interested banks , both existing lenders and potential new lenders , and have been progressing term sheets and expect the process to conclude towards year end or in the early part of next year .

Speaker #5: So overall , a very good quarter that aligns with the financial outlook that we provided at our June Capital Markets Day . So I will now turn the call back to Jack for some final remarks .

Speaker #4: Thank you . Tyler , I'll take a few moments to discuss one of our near-term growth initiatives , which we outlined at our Capital Markets Day back in June .

Speaker #4: Cathode production at Casa continues to improve . We delivered another strong quarter and are on track to produce approximately 24,000 tons of cathodes .

Speaker #4: This year , compared to an original plan of approximately 16,000 tons total cathode plant capacity is roughly 35,000 tons . As we discussed in June , our goal is to capture an additional 7 to 10,000 tons of cathode production from a baseline of 15,000 tons , which was the average annual production over the two years prior to us acquiring Casa .

Speaker #4: Over the past 8 to 12 months , we've implemented several key operational improvements . Firstly , we enhanced leaching practices , including better dump leach coverage and higher irrigation rates .

Speaker #4: Secondly , we have increased oxide material placement on the depth on the dumps supported by improved geological understanding and tighter waste control in the open pit .

Speaker #4: These actions are now translating into higher cathode output as the benefits flow through with leach cycle residence times . As mentioned by Juan Andrés , we also recently completed an update to our hydrogeological leaching model , improving our ability to predict leaching kinetics and incorporate recent operational gains .

Speaker #4: Based on these improvements , we see potential for future annual cathode production to increase further , which we are now analyzing . On the next slide , before reaching the closing remarks , I would like to outline a few upcoming catalysts to look out for .

Speaker #4: We're in the final stages of completing our Rai application and see a potential window to submit before the end of the year . In the first quarter of 2026 , we expect to complete the Integrated Technical Report for the large scale , fully integrated development and operations plan for the Vicuna project .

Speaker #4: This milestone will outline a clear path for Lundin Mining to become a top ten global producer . Once in full scale operation at Vicuna .

Speaker #4: In parallel , and as Tyler mentioned , we're advancing our financing strategy to support these growth plans . We've initiated the process to increase our revolving credit facility and continue to see strong interest from our existing banking partners , as well as future lenders .

Speaker #4: We expect this process to conclude towards the end of this year or early part of next year . As as Tyler mentioned . Atrapada , the Suva project represents a compelling near-mine growth opportunity with the potential to add 15 to 20,000 tonnes of copper and 50 to 60,000oz of gold annually .

Speaker #4: Production increases of approximately 50% and 100% , respectively , for the operation . The study includes expanding , grinding capacity to process higher grade ore from Suva through the Chapada mill , permitting and technical work are underway with the pre-feasibility study targeted for completion by the end of this year .

Speaker #4: We look forward to providing further updates as this exciting project continues to advance . Touching on the conclusions , now , we delivered our best quarter year to date , producing 87,353 tonnes of copper at a C1 cash cost of $1.61 per pound .

Speaker #4: Strong operations and higher gold prices enabled us to raise production guidance and lower consolidated cash costs . The copper guidance midpoint increased by 11,500 tonnes to 319 to 337,000 tonnes of copper , driven by stronger cathode production at Casa and improvements in the leaching circuit at Casa .

Speaker #4: Bonus cash cost guidance at Casa . And dropped , lowering the consolidated midpoint by 12.5 cents to $1.85 to $2 a pound . We generated 383 million in adjusted operating cash flow , strengthening our balance sheet with the company expected to essentially be net debt free by year end .

Speaker #4: We continue to be in strong financial standing as we look to advance our growth initiatives at Lundin Mining . Looking ahead , our priorities remain focused to to continue to deliver on strong safety performance , which directly supports our operational excellence programs advancing near-term growth and preparing Vicuna for potential sanctioning .

Speaker #4: In 2026 , the company enters Q4 well positioned with key catalysts over the next 4 to 6 months , including , as mentioned , a application in the near term and an integrated technical report for Vicuna .

Speaker #4: All in all , a very solid quarter and we we remain poised to deliver a strong overall 2025 . Operator I'd like to now open up the call for questions .

Speaker #4: Thank you .

Speaker #3: Thank you . As a reminder , if you would like to ask a question , please press star One on your telephone . We also ask that you please wait for your name and company to be announced before proceeding with your question .

Speaker #3: One moment while we compile the Q&A roster . The first question will be coming from the line of Orest will Cadao of kosher Bank .

Speaker #3: Your line is open .

Speaker #6: Hi . Good morning and congratulations on the strong quarter . I'm just curious with the integrated technical report for Vicunas district . I guess only a couple of months now from completion .

Speaker #6: Just curious if there's been any thought to any potential scope changes on what phase one or phase two could look like , and whether we should still be anticipating , call it around a 175,000 tonne a day operation for that would reflect Jose under phase one , or at just trying to understand if any of the goalposts have been locked in at this point , or whether the project scope is still under discussion .

Speaker #4: Hi , thanks for the question . I would I would say that , you know , broadly speaking , the the the scope for phase one has not changed significantly since we last gave an update on Jose Murillo , which is considered to be phase one for the vicuna project .

Speaker #4: You know , we're we're working through this integrated technical report , which we'll have a lower level of definition as you get into the later phases .

Speaker #4: But I would say our level of confidence , especially for phase one , continues to grow with that . You know , those numbers that you mentioned there .

Speaker #4: So , you know , the oxides we're looking at opportunities continuously looking at , you know , areas where we can improve costs .

Speaker #4: And , you know , and drive value . And I think as this technical report comes together and we put all the phases together and , and look at , you know , various trade offs like that will that will show in Q1 when the report is published .

Speaker #4: But phase one specifically , you know , we continue to refine and de-risk on scope . That was , you know , that we've been speaking about for for the last number of quarters here .

Speaker #4: So we're we're we're on track and no significant changes should be expected from from phase one , particularly .

Speaker #6: Okay . And just as a follow up on the timeline , just given we're already in November , do you have a sense of of when in Q1 we could anticipate that ?

Speaker #4: I can't pinpoint an exact date for you , but I would say in the towards the latter part of Q1 that will be coming out with the results .

Speaker #4: And then there's going to be a period between when we come out with the results and when we actually publish a technical report , but obviously the team is working , very hard on trying to get everything together so that , you know , some , some part in the second half of Q1 will be able to publish the results , followed by the the report coming out within 45 days of when the the results get published .

Speaker #6: Okay . Perfect . Thanks very much .

Speaker #3: Thank you . One moment for the next question . The next question will be coming from the line of Lawson Winder of Bank of America Securities .

Speaker #3: Your line is open .

Speaker #2: Thank you . Operator . And hello , Jack and team . Very nice quarterly results . And thank you for today's update . If I could also ask about the integrated Vicuna plan and just get a sense for , for one aspect that Philo had previously proposed , which was this idea of a precious metals focused initial starter pit .

Speaker #2: I mean , for a smaller company like Philo , it made a lot of sense for larger company like Lundin . Perhaps , you know , it's just not enough capital or cash flow to to really move the needle .

Speaker #2: But I mean , that would be in a much lower gold price that , that , that I would , I would make a comment like that .

Speaker #2: I think in the current gold price . I mean , is there any thoughts potentially doing some sort of precious metals focused starter pit with Philo in conjunction with the phase one at .

Speaker #2: That you just spoke about ?

Speaker #4: Right now , you know , we're we're still kind of going ahead with the the base plan that we've outlined . Phase one being Jose Maria , of course , with commodity prices going higher , we , you know , see if there's opportunities to maximize value based on that , you know , based on market conditions .

Speaker #4: But right . Now , Lawson , I would say phase one still is very much contemplating Jose Maria . And then and then phase two being the oxides of of Philo , which includes base and precious metals .

Speaker #4: So , so , you know , considering summarize , no , we're not we're not considering changing the scope right now .

Speaker #2: Okay , perfect . And then just thinking about some of the opportunities that , that lie ahead , including the success you've had at Casa Cronos .

Speaker #2: You know , this update we're looking for in early 2026 on UVA , the current 2026 CapEx plan that you've laid out , is there a risk that X Vicuna that could change materially from what you currently have in the market ?

Speaker #5: Or so . Good morning . Lawson is tight here , but on CapEx we have not guided any CapEx for the company in 2026 .

Speaker #5: What we did say a couple of day that we had around about 155 million , I believe it was for the silver expansion .

Speaker #5: And that number remains intact .

Speaker #2: And then as we think about Casa , I mean , could you expect something materially or I guess the way to think about it then is could you expect something materially higher from what you guys are on track to spend this year ?

Speaker #5: No , I don't think so . I mean , we will come out with our usual annual guidance in January and all that will be disclosed , but I would not expect any any significant deviations on current trends .

Speaker #5: .

Speaker #4: And that increase in in cathode production that we outlined in the presentation doesn't come at any real , you know , additional capital requirements , which is why it's such a , you know , robust opportunity and really the team has been behind .

Speaker #4: It has been just working on optimizing the leaching circuit . So as tighter said , we wouldn't expect to come out with any materially increased capital numbers for for Casabona specifically .

Speaker #2: Thank you very much .

Speaker #4: Thanks , Lawson .

Speaker #3: Thank you . As a reminder , if you would like to ask a question , please press star one one on your telephone and our next question will be coming from the line of Daniel Major of UBS .

Speaker #3: Your line is open .

Speaker #7: Hi , Jack and team , thanks . Thanks for the question . Congrats on a good quarter . Just first question on the oxide production profile at at Casa is 25 000 ton run rate this year .

Speaker #7: Is that a reasonable assumption to bake into the subsequent couple of years ? And can you remind us what was embedded in the 130 140 guidance ?

Speaker #7: I've got about 15,000 tons previously , so is there upside to that ? 20 ? Six previous guide number ?

Speaker #5: Morning , Daniel . This is Juan Andrés . Thank you for the question . Yes , I think the answer to your question is , is yes .

Speaker #5: Looking forward , we're looking at sustaining that level of production from the cathode plant . So 2420 5000 tons per day , at least for the next , let's say three four years is a good , good assumption .

Speaker #7: Okay . Thanks . And then just a question on follow up on the CapEx . Sorry if I'm getting some of the numbers mixed up here , but is it fair to assume this CapEx for the group excluding any spend at Vicuna , would be a similar kind of run rate ?

Speaker #7: So like for 100 million or so , and then on top of that , you assuming a late FID of vicuna late in the year , probably a similar run rate of spend at at vicuna .

Speaker #7: So we're looking at a similar sort of six 5700 range . Is that reasonable for CapEx for next year , excluding any other FIDs ?

Speaker #5: Yeah , I mean , we as I said , we will come out with further detailed guidance in January . But this year we we guided 530 million in sustaining CapEx for the full year .

Speaker #5: And we've now guided that down to 410 . I think it's important to say that that saving is or that reduction is not really a saving is more a deferral of projects from 2025 into 2026 .

Speaker #5: Also , remember our CapEx guidance is based on cash payments , not incurred . Activity . But I think that run rate of from about the current 2025 run rate we have should be roughly what we expect to see going forward .

Speaker #4: Just to clarify , 530 down to 510 ,

Speaker #5: Sustaining .

Speaker #4: Capital .

Speaker #5: Excluding growth CapEx . Okay .

Speaker #4: Yeah . And and Vicuna like we're going through we're going through the we're going through the , the 2026 budget . Now with the Vicuna team .

Speaker #4: And similarly we would be updating kind of the the guidance range on that . But you know , hopefully we'll be in a position where we can continue to to ramp up with activities prior to a sanctioned decision .

Speaker #4: So it wouldn't be like you could expect that , you know , provided progress continues on the trend that it is that it would be higher than higher next year than it is this year .

Speaker #7: Okay . That's clear . Thanks . And then maybe just a just a final one . This reasonably sizable working capital build in the quarter , 112 million or something , which puts you net up quite a bit in terms of working capital year to date .

Speaker #7: Would you expect that to reverse in the fourth quarter ?

Speaker #5: Yes , I would expect that . It's always hard to predict the exact timing of , you know , year end shipments , etc.

Speaker #5: but if everything goes according to plan , we should see an outline of that in the fourth quarter . Yes .

Speaker #7: Great . Thanks a lot .

Speaker #3: Thank you . One moment for the next question . And our next question is coming from the line of Dalton Barreto of Canaccord .

Speaker #3: Your line is open .

Speaker #8: Thanks . Operator . Good morning . Jack and team . Congrats on a great quarter . And also great choice for pointing Ron as CEO of Vicuna .

Speaker #8: I wanted to ask about some of these cross-border negotiations that are still ongoing . Jack , can you sort of remind us what elements are under discussion ?

Speaker #8: What the status is and what's going to be assumed in the technical report when it comes out ? Thank you .

Speaker #4: Thanks , Dalton . Yeah . Fully agree . It's great to , you know , officially bring Ron over to to Vicuna starting effectively tomorrow once London gold gets through their quarterly results .

Speaker #4: So the bi there's a binational treaty that exists today between Chile and Argentina I think it was established in 1997 . There is on that treaty a vicuna protocol that exists during this current exploration phase that the project is in .

Speaker #4: So we're able to kind of move from one side of the border to the other . Freely . And at the moment , what we would be looking at doing is specifically when we get to phase four and we're mining from fellow sulfides and getting to full scale , that would require , you know , the binational treaty to to turn into kind of an exploitation arrangement .

Speaker #4: And at that time , we would be contemplating significant pieces of infrastructure like desalinated water line , potentially concentrate slurry line , and really integrating all of the infrastructure together during that , that final phase of the project .

Speaker #4: But initially , what we're looking at doing is building José Maria 100% within Argentina and then trucking the the concentrate out . And so we don't need to have that significant uplift in that treaty .

Speaker #4: But we have time . There is engagement between both the Chilean and Argentinean authorities , you know , to to elevate this national treaty into exploitation phase .

Speaker #4: But that's not required during the initial years of production through Jose Maria .

Speaker #8: Got it . So no concerns around moving the concentrate out through Chile . No concerns around bringing water up or any of that kind of stuff .

Speaker #4: I think it's early days that we're working on that . That plan and that scope , and we have time to ensure that we , you know , we do it the right way .

Speaker #4: So , you know , so far our our baseline schedule is intact . And I think dialogue is , is , is strong .

Speaker #4: And we just need to continue building on that momentum . So so overall I think we're feeling very positive about all phases . And we'll just continue to de-risk as we bring the project forward towards , you know , integrated study and eventual sanction .

Speaker #8: Got it . Thanks , Jack . And then once the study comes out and you've a pin in it , what are sort of the next remaining steps before an FID .

Speaker #4: So I think , you know , having fiscal stability , having the integrated technical report , you know , released and published , having our financing plan so that , you know , Lundin Mining can ensure that we can fund our 50% portion of , of of phase one .

Speaker #4: And then there's , you know , various permits that we're still working through . And government agreements . And the provincial level at San Juan that we would need to receive .

Speaker #4: We're updating our environmental impact assessment as well . So there's a number of kind of items on the checklist that we would be required to fulfill before going to the shareholders .

Speaker #4: Being BHP and Lundin Mining for for a sanction decision . But we're progressing well on , on on all of those fronts .

Speaker #8: So this could be a sort of a back half of next year type thing .

Speaker #4: If we continue to to progress on the plan that we that we currently are on , then , you know , it's not out of the question to to have a sanctioned decision coming at the the back half of next year .

Speaker #4: Of course , a lot of work to be done between now and then . And we're we're working to make sure that we , we get all of our ducks in a row to achieve that .

Speaker #4: So , so that's the hope .

Speaker #8: That's great . And maybe just one last one . This is more of a confirmation thing than anything else . What you were applying for under Righi is all the phases , right ?

Speaker #4: That's a great question . So because we have Jose Maria and Del Sol together now under Vicuna Corp , within the same SPV , you know , the projects are integrated together and they're looked at as one large scale project .

Speaker #4: However , for us it's important to get , you know , fiscal stability and , and approvals and permits for for phase one as we have much more definition around phase one .

Speaker #4: But , you know , the intention would be achieving fiscal stability on the entire Vicuna project , which includes both Jose and Filo and potential future discoveries in the region .

Speaker #4: As we know , it's a very prospective area . And we we definitely feel like we'll be finding more minerals as we continue to , you know , spend more time in the area .

Speaker #8: Great . Thanks , Jack . That's all for me .

Speaker #3: Thank you . And there are no are no more questions in the queue at this time . This does conclude today's conference call .