Metals Acquisition Limited

Thank you for standing by. This is the conference operator. Welcome to the Max Cooper Limited Q4 2024 conference call and webcast. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star then zero. I would now like to turn the conference over to Mick McMullen, CEO of MacCooper Limited. Please go ahead.

Thank you and thank you everyone for joining. Obviously it's a busy couple of days for quarterlies in Australia. We'll try and get through this fairly quickly for people.

So there's a presentation online there that people can see that's also been lodged on both the exchange platforms and I'll talk to that. Joining me today is Mornay Engelbrecht, our CFO. And so as we go through the presentation, there's the usual disclaimer and forward-looking statements that people can read. In terms of Q4, where did we land? We landed at 11,320 tonnes of copper at a grade of 4.1% milled. So that brings us in just above the midpoint of guidance that we had for last year. And pleasingly, the grade continues to be good as we continue to work on... dilution control. Morne will talk to the financial shortly but you can also see on that slide that we had a C1 for the quarter of $1.66 US a pound and so that's quite a good result. We saw really only about a month of benefit from the lower exchange rate and so that bodes well for 2025 obviously as the Aussie dollar has fallen significantly. Again liquidity, we had about $213 million US of liquidity at the end of the year. which in Aussie dollars is actually a very large amount of cash for us given our operating costs. We continue to run at about a 47% EBITDA margin and we convert about 74% of that to cash for the year. And we're well on our pathway to our greater than 50,000 tonnes of copper production by 2026. As per the quarterly report we announced, we will typically announce our resource and reserve and any changes to guidance in about the third week of February. And that work is well underway and going through the final external checks. So if we look back on 2024, I think we delivered on all of the things we said we would. We operated the mine safely, all permits in place. We increased the reserve life to plus 10 years. So it's about 11 years based on last year's reserve. We had record copper production. We achieved and beat the midpoint of guidance. We delevered and simplified the balance sheet massively. So at the end of the year, we had net gearing of around about 15%. And again, with the cash flows we're generating, we continue to pay down debt and reduce that. We got started on a bunch of growth projects, mainly the Vent project and the Kuta South Upper. We raised a fair bit of equity on the ASX in two raises. And we've built out our management team so that we're set for the future and stability. We have a clear pathway to get to about 50,000 tonnes internally. Whenever we look at stuff, we're always lining up the best options for shareholders in terms of return of capital and certainty. And right now, the best thing we can do, apart from delivering the balance sheet and reducing our interest burden, which is well in hand, I might add, but is to actually grow organically. We have a lot of opportunities. If we take the midpoint of guidance for next year, it's at about 50,000 tonnes. The midpoint of guidance for this year is about 45,500 tonnes. And for those of you that are quick on the calculator, you'll see that we basically ended Q4 last year at the midpoint of guidance for this year. We continue to optimise the mine. Then obviously we've got the growth projects like the ventilation project, which really does unlock the bottom of the mine. and allows us to try and fill that mill up. We know the mill will run at 80,000 tonnes of copper anguillage. We have run it at that when we had the ore. And in Cutia South Upper, we are well and truly into the development of that now. There's been a big focus on that in the last couple of months of last quarter. And I'm pleased to say that that thing's moving ahead. So we're feeling very confident about this, about actually potentially getting a little bit more than that 50,000 tonnes. because there's a few things like Cutia South Upper, which last year were not in reserve. We've now drilled it out and it will be in reserve, which then allows us to start including it into our production plan. Again, highlights for the quarter. So record production under the MAC ownership, record low C1, total cash cost of about $2.31 a pound. We average just over 12 pounds copper. So again, in anyone's language,

That's a pretty solid margin for us.

That's now reduced to 21 and 2.15. So it's a significant impact. There's about a 70% reduction in our C1. So, you know, so that really is about a 16 cents a pound reduction, US, in our C1 that comes into effect from the start of January. I touched on the exchange rate earlier. Somewhere in the quarterly, Mornay's got a sensitivity there. But, you know, obviously with the Aussie dollar at 62, 63 cents, we've got quite a tailwind. as about 80% of our costs are actually in Aussie dollars. Morne, I'm going to hand over to you for the next few slides on the financials.

I'm not sure Morne was able to dial. He was. Are you... Mornay, have you been able to dial back in?

Mornay, I think your line is muted on your end.

Okay. Well, I guess I'll do the financial stuff until we can get Mornay to dial back in. We've had some challenges with the lines. So over the course of last year, we saw net gearing move from 41% down to about 15%. Cash and cash equivalents expressed in US dollars has gone from about $32 million to $172 million. And I would point out that in Aussie dollar terms, it's actually grown even more because obviously when we translate our Aussie dollar balance, which is about half our cash back to Aussie, when the Aussie dollar has fallen, we've lost a few million US dollars through the translation. Off the top of my head, I think it was about $277 million Australian dollars at the end of last quarter, which is a large amount of cash to have on the balance sheet. We have agreed, as announced to the market, the early repayment of SPROP. We're just going through the process with our senior lender, Senior Get Right Now, to upsize our revolver and get places looking in terms of the balance sheet.

Sorry, Mick.

I'm back on. I dropped off for whatever reason. Can you hear me?

Yes, we can hear you, Marnie.

All right. Sorry, Anna. I'm not sure what you covered already, Mick, but obviously on that slide, obviously very significantly delivered max balance sheet. We've reduced net gearing by over 60% to company record of net gearing of 15% at 31 December. So comfortably below one times EBITDA. We also have a very healthy 172 million US in cash. That's around 276 million Aussie. at our disposal at 31 December, so that's, again, over 400% better position since the end of 2023, which is further supported by an undrawn revolving facility of 25 million, outstanding QP receipts of 6.5, unsold concentrate of about 5.5, and then we've got that investment in polymetals as well, which is around 6.5 million Aussie at 31 December. So that brings our total available liquidity to around 213 million US or 340 million Aussie dollars at 31 December. The balance sheet was boosted also by the completion of the successful equity raise we did in October. So 150 million Aussie or 133 million US before costs. So we are therefore well equipped to further optimize our balance sheet as we announced in December through the retirement of the existing $145 million mezzanine debt facility. As I said to that end, we announced in December that the original agreement was struck to repay that facility at max discretion, obviously with no additional penalty cost on that. We're also going through a refinancing process to reset our senior debt, which will not only support repayment of the MED facility, but obviously provide a cheaper, longer dated and material reductions on our repayment profile as well. So watch this space. So in summary, Max Energy is in a very strong and commanding position. So, and frankly, the best position we've been in since the inception of the company. So, and that provides us with great flexibility while we drive our organic growth as Nick has outlined. Moving to site nine, um you know we've been squarely focused on as i said the simplification and and delivering of the banner sheet and uh obviously utilizing that great cash flow uh generation from our operations uh to not only grow production material but produce our interest beyond liabilities as well so um if we look at the operational corporate side of the the quarter on quarter movements there's a few things just for highlights so firstly uh again we had a very healthy free cash flow from Operation 30 after sustaining capex of around 30 million US for the quarter. That's sort of in line with Q3. It should be noted that we did have a delayed shipment at the end of December, so we made a part sale of a shipment of concentrate, which was at port before year end. So we aren't, we recognize it as cash, but we aren't able to recognize it as revenue. So we recognize that revenue in January when the ship is loaded. Obviously, if we had to recognise that in December, then our free cash flow from operations would have been around that sort of 37 million US mark. Secondly, we further reduced our senior debt, so we paid another 8 million US back on that facility, so another 5% reduction. So that's now standing at about 158 million US at the end of December. And we also had a performance gearing ratio of 15%, as I said, so that's a 60% decrease from where we were at the end of December last year. The third point I want to make here is that we paid interest of about $8 million, so that's both for the MES and senior facilities, so about $4.5 million of that at the MES facility. With the repayment of that MES facility, we'll save around sort of that $12 million, $13 million million US per annum in interest cost. The other key elements from the cash flow is this same capex of 12 million. So that's largely in line with the previous quarter. So that gives us about 50, just over $50 million sustaining capex of 2024. So overall, very strong and healthy balance sheet position. And, you know, we're looking to further strengthen that position with the repayment of the spot, the facility, and obviously the refinancing process we're going through. You know, the repayment of the spot, as I said, will drive significant cash savings from an interest point of view, which will not only simplify the balance sheet, but also the P&L as well. With that, I'll hand back to Mick.

Thank you. All right, hopefully people can hear me. The lines aren't very good today, so... The other thing that, you know, we want to touch on is our safety. So, you know, safety, we've always said on the quarterlies, we think we can do better. Q4, we did do significantly better. Triff has come down from about 14 to just under 11. We do see potential and we think we should be lower than that. So, you know, we'll continue to drive that down. We are our main capital project outside of the Beanton QD South Upper is the Stage 10 lift. We're well advanced on that. Those works will continue all the way through Q3. But once that's done, that gives us tailings capacity up to about 2030. And that's spent and done, right? So we're in good shape. As Morne touched on, we sort of indicated around about 50 million US of capital for the year last year. And we've come in just under that. So no negative surprises there. Again, from a proper production point of view, you can see the trend is up quarter on quarter, again, driven by actually more autumn and better grade in Q4. You can see C1 and total cash costs, you know, again, a great trend over the course of the year as we've managed to strip out costs, improve production, renegotiate contracts. And so, look, a C1 of 166, given the average exchange rate versus where it is now and the fact that we're seeing around about 15, 16 cents saving on our TCRC from January on. We're feeling pretty confident in the directionality of where the C1 is going. And again, I think if we look at this, best production quarter we've had, best C1 and total cash cross we've had, best balance sheet, net gearing, best safety, And so I think as a company we've delivered on what we told people we would do and as we get more and more into what we actually have at the mine, we're finding quite a few growth opportunities that are just organic that we already own for relatively little money actually. Mill grade, again, the last three quarters, let's call it 4% on average. That seems to be about where we are. Again, that's a combination of where we're mining, but also better dilution control. We are, again, directionally, when we did the reserve last year, we added a fair bit of dilution in the reserve number, and we have been mining above that grade. it's likely as we do the reserves this year, we might sort of modify that a little bit to be a bit more reflective of what we're actually mining. Development meters, down on the relative previous quarter, but sort of flat for the year. We've pushed on, the decline's been pushed on a long way. It's now currently 25 meters vertically above the bottom of the 2023 reserve. We're finding more ore tonnes per vertical metre there, so actually that's allowed us to not have to do quite so many metres of development, but ore tonnes at 286,000 tonnes was good. The month of December off the top of my head was 103,000 tonnes for the month, and that's before our ventilation comes in, or to the south upper is online. We're feeling increasingly confident about delivering the operation and we can't do the ventilation fast enough to be able to really unlock that mine. Kos, Mornay, I might hand back over to you and you can talk to the dollars.

Yep, no, it's good, Meg. So slide 13, so processing mining costs per mole and mine time there. First, the processing cost per tonne in Q4 was around 26, so slightly down from, you know, by around 2% from the previous quarter, mainly impacted by the increase in both tonnes and high and great material being processed for the quarter, but otherwise pretty stable there. On the mining cost per tonne, you know, the comparison, you look there, there's a very positive trend in terms of the metric continue, you know, in terms of this metric continues, with mining costs reducing by around 21% from Q1. around 12% in the last quarter alone. Obviously, this is mainly driven by that 20% increase in oil mined for the quarter compared to Q3, which is also a 12% increase on the previous three quarters average mined tons. And as Mick said, just over 100,000 tons mined in December alone, so that's driving that cost per ton much lower. So obviously this not only demonstrates what's possible from a mining perspective, but also demonstrate the spreading of a large portion of our fixed costs over increased volumes. So as we previously mentioned on previous calls, our fixed costs is around that sort of 65 to 70% with labour making up about 60% of our mining costs as well. On slide 14, we cover G&A and development cost per metre. Again, pleasingly to see the GNA side of things, you know, mainly impacted by milling tons, which has increased by 9% with the unbind gene costs, GNA costs, you know, gross GNA costs largely in line with the previous quarter. Development costs per meter was largely in line as well with previous quarter, so as well with the overall capital development meters across all capital projects, largely in line with previous quarters as well. Slide 15, moving to tonnes more per employee. So again, very pleasing to see much higher by 10% compared to the previous quarter. As noted, the additional tonnes mined in December quarter, you know, some 9% compared to the previous quarter drove the increase in tonnes more per employee. The employee base relatively stable over the quarters as well. Sustaining capex decreased slightly over the quarter, but as we said, that will sort of end up at the $15 million mark for the year when we report our results. So overall consistency and increased efficiency in operations increased, and increased grade as well, driving our production, free cash flow, and decreasing our unit cost, and that obviously supports a leaner a more simplified balance sheet and obviously as we deliver more capital development for this year as well and can continue to grow the company. Mick, I'll hand back to you for the rest.

Thank you. Many of you have seen this slide before. Look, I think hopefully the message has gotten across now that we aren't actually all body limited. There's been a great track record of replacement of R&R. We clearly grew it a large amount last year. we're starting to see a lot of additional potential in and around the current mine. And as I said, we've expanded the main ore body, QTS North, by 20-25% along strike. We have a fair bit of material that hasn't made it into reserve historically, measured and indicated, plus a lot of inferred, a lot of the drilling, if you look through the historical drill releases the last year, Much of that's aimed at upgrading inferred mineralised material to measure indicated for conversion to reserve. And again, really we're just limited by drilling. All the ore bodies are open, not just at depth, but some up and down. And so there's a lot of potential here to continue to mine for a very long period of time. So we don't really see that as a limiting factor anymore. It's actually getting it out of the hole faster is the key. This long section is useful for us to talk about, so currently we mine 75-80% of our ore out of QTS North, a little bit out of QTS Central, and then a couple of other ore bodies not shown there. QTS South Upper, the very top left-hand thing, we're on our way to develop that. Q4, we'll have some production out of that, and that will turn up in reserve now that we've drilled it out. Kittiest South, the sort of one on the extreme left there, you know, that is very high grade. The bottom of that's running about 7% to 8% copper. The very bottom hole, sort of at the bottom, it was 9.5% at about 20-odd percent copper. In the current mine plan, that's still a fair way out. We'd like to mine that a bit quicker, and that's one of the things that if we get a bit more bent in the mine earlier, we can start looking to get out there and drag some of that material forward. In the very top of the mine there's a red bar and a yellow looking thing which is the east and west lenses. We've been doing a fair bit of work in that area up there looking at historical zinc for a start, but also the copper mineralisation. There's significant copper mineralisation up there and the zinc we've talked about historically of the ability to track that to polymetals. There's a fair bit of focus on that right now. We've put a separate team on that to look at developing what we call the upper mine. We think there's, again, when we talk about organic growth opportunities, we see 400 or 500 metres vertical ore body there in separate zinc and separate copper deposits. And that actually has the potential to, for very low capital cost, add a reasonable amount of production. And so that's a high focus for us right now, particularly as we're developing out to QG South Upper. If we can open up a mine in front of the top of the mine that is not connected to the bottom of the mine, not pulling vent from the bottom of the mine and not coming up the shaft, it's all incremental production at a very low capital cost. It's all within 50 to 100 metres of existing development and very shallow. It starts 150 metres below surface. So we're quite excited about this. We're working away. Probably the first thing we'll come out with will be the plan around the zinc Our investment in polymetals has done very well, and we have the right to put another $2.5 million in at $0.35 into polymetals. And, you know, they're working away and sort of, you know, they'll be in production here in the not-too-distant future. And so we're quite keen to push our plans forward to be able to truck some Zincore up there. But actually, we have a pretty substantial copper ore body that looks to be sitting up in that proportion that we can go online as well. So again, when we look at all of the things we can do, obviously paying off the spot debt is a guaranteed return at a sort of 12 and 12 and change interest rate. So that's a no-brainer. But we have some great opportunities here in terms of advancing the business. So that's really our focus right now. Again, QDS South Upper, it's small, it's super high grade. We are mining up towards it now. It was a hive of activity there last week when I went down there. We're pretty excited about this. We have another deposit about 200 meters, 250 past this called Pink Panther. We're actually going to continue to drive out and we'll use those accesses as drill drives because these ore bodies are sub-vertical. Drilling them from surface, you can miss them easily, but drilling them from around is much easier. We're quite excited about this. Q4 is when we expect to see the first production coming out of this thing. The ventilation project, so we get asked about this a lot. Total budget's about 42 million Aussie. We will spend, because I think in the US, we'll spend around about 22 million US, I think, on it this year. Target completion date's Q3 of 26. And so we're well advanced on that. The JT drilling's been done. We're pushing the drives out, interestingly one of the drives i was standing in it last week that face that you can see on that slide there was running about 15 copper um so we're actually pushing out on a stringer uh which will you know provide us a bit of extra incremental and pay for that thing and then and then it'll run out and we'll push out past that but um it does highlight you know we when i went um there with some people and we went to have a look at the ventilation drive and we turned up to a face that's running 15 copper um That's CSA for you. You can get those things all over the place, and it's all about being on your toes, identifying them and mining them and getting them in the mill as quick as you can. So in terms of our plans going forward, so we sort of see plus 50,000 tonnes, starting to become a bit more confident about maybe we can do a bit better than that. We sort of see the target for C1 down around the 150, take Q4, 166. We've told you that we'll get about 15 or 16 cents off for the TCRC improvement this year, so you don't have to be a rocket science to work out that we're feeling quite confident around getting down that level. And net gearing, again, end of the year at 15%. Morne would like 10% to 20%. I'm pretty happy with 0%. But once we've paid out the spot facility and we've got a bit more flexibility, we can start looking at things like shareholder returns, which in the current structure we aren't able to do. So again, as we generate cash, self-funding all of the stuff that we're doing, we see a good pathway for organic growth and we think the balance sheet is in a great shape now. So the business, quite frankly, has never been a better position. I was down the bottom of the mine last week with some investors who've been with us for the journey all along, and I think they were quite surprised at just how much activity we have going on there relative to over the last 18 months. We're starting to get into a good rhythm and cadence now, and so we feel pretty comfortable about the growth profile of the business. So look, that's our strategy. Deliver operationally, execute organic growth. I think quite frankly, right where we are, it's deliver the balance sheet, share all the returns and grow the business, I think is quite frankly where we are. And we're feeling pretty good about the operation. I'm feeling less good about where my share price sits. But look, CSA has been an amazing operation. The team at site have turned it around. We've stabilised the workforce. I think they've delivered really well. We can see the great runway now in terms of what else is to come. And, you know, when your head grades 4% copper, it's a pretty good mine. So with that, I'm going to turn it over for any questions, if anybody's got any, and happy to take as many as you want.

To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two. First question comes from Daniel Morgan with Baron Joey. Please go ahead.

Hi, Mick and Morne. First question, just on achieving your production outcomes you'd like in 2025. What is the key driver versus 2024? Is it more tons mined or grade or both? Thank you.

Yeah, I think grade will be hovering around about that four, maybe just under four. So it's more tons is the short answer and more consistency, Dan, in terms of how you get those more tons. So quite frankly, we know this mine can produce a lot more than 45,000 tonnes of copper a year on a week-by-week basis, it's eliminating the weeks when you're producing at half that rate. That's actually, if we talked about consistency before, it's that consistency piece. And that's why I say we've never had more working places open. We've never had more places to go. We've got the haulage system sorted. and the people are all in place. So that's really the key, Dan, it's consistency.

So to that end, I mean, it was pleasing to see the lift in mind or tons in the quarter.

Is that something we should expect, you know, for the March quarter, for example, another, you know, lift or stability or what's... Well, we're not really... We've got to come out with our guidance in about three weeks, but, you know, I think overall for the year... We're not really in the business giving quarterly by quarterly guidance, but overall for the year, we expect to see a bit more tonnes, more tonnes, similar-ish grade, and that's where your production lift comes from. But again, we exited last year in the quarter at midpoint of this year's guidance already, so it's really about doing what we did in Q4.

Thank you. And just on the RIS... Just on the resource reserve update coming in Feb, what is in scope, you know, your various ore bodies, what's in scope to be considered for that and what is too early with regard to the drilling on cut-offs or anything to be considered? Could you maybe talk through the various areas?

Yeah, so Kydia's north, Kydia's central, east, west, Kydia's south, Kydia's south upper will all be in that. And so really the only new one there is Kydia's south upper. But obviously there's been drilling to expand all of them and so both total resource expansion plus conversion to M&I for reserves. We're working towards seeing if we can get a zinc resource out and then the copper resource, like in the upper portion of the mine. The copper in the upper portion of the mine is unlikely to be in there. We have an internal number. But it's probably not quite ready yet. It needs probably a few more test holes into it, just confirmatory holes before we can roll that out. That may be a mid-year update. So, yeah, in an ideal world, we're literally going through the finalisation right now. The external checks, we've sent it out to external checks. So we're in that phase right now. So the board will sign off on that in two or three weeks. Thank you. We would like to get a zinc resource out so at least then we can talk about what that production plan looks like.

Yeah, right. So I note Poly's plans, I think it's mid-year to be back up and running. It would sound like it's still going to be a little bit of time for you to do the work on your end to provide ore into that, you know, zinc ore into that JVU.

Yeah, I think realistically towards the end of the year, you know, sort of Q4 type sort of stuff. Right now, the upper part of the market can't do so far except that run. And then we can come back and do the development for the zinc. The development work for the zinc is actually quite small because it's so close to development. It's just, you know, we've got to focus on doing stuff in the order that it needs to be done. But yeah, it's sort of Q4s.

Okay, thank you for your perspectives, Mick.

The next question comes from Sam Catalano with Wilson's Advisory. Please go ahead.

Yeah, hi. G'day, Mick. I rarely give the congratulatory thing from analysts, but excellent quarter, so well done to everyone. Two questions. Just to probably ask the questions that Dan was asking, perhaps in a slightly different way. So let's assume you get that consistency on grade and output levels through 2025. Then that annualises roughly around that midpoint of your existing guidance. I know that's due an update. But if we think about what might get you to the top end of the current guidance range, what's it likely to be in 2025? Would it be surprise grade bump? Or is it likely that you can see an avenue where the output will materially move up and you can get towards that 48 type figure?

I think the key is actually QT of South Upper, which is not in the current guidance range at all, because it was inferred last year. And so that's about 1500 tonnes of copper a quarter, maybe a little more when we get into the meat of it. So if we can try and drag that forward a little bit, like, so it's not currently in, like, if we look at the midpoint of guidance, there's nothing from QTS South Upper in that. So if you can get a full quarter, then there's 1500 tonne of copper, right? So there's a reason that we put it into everyone's bonus for this year is first ore out of QTS South Upper, the earlier the better. And so I was there last week up on the two level and it is a high of activity. So for us, that's pretty crucial, right? And so, you know, I think Q4 is where we can assume, you know, that we'll get some more out. There's none of it to get to midpoint of guidance right now. That's not in the plan. And so if you think about what's the swing factor to get to the top end, it'd be that. And then the other opportunity we have is that, you know, as we drive out there, there's definitely smaller lenses on the way. If we happen to be lucky and we happen to find something that we could mine, then there's some chance that we could do that as well.

Got it. And just to clarify what specifically my second question was on QDS South Upper, you've talked about first ore this year. Is that just development ore or are you actually talking about first stoping ore?

The metric we've stuck in everyone's bonus is first doping off.

Thank you. Again, it's narrow, but it's very high grade, and so you don't need a lot of ore tons out of that thing to get 1,000 ton of copper or 2,000 ton of copper. Again, we get asked about this. We've probably been a bit delayed. We went out to contractors to see if we could get a contractor to do it, and they're actually whether it's scale or they're all busy on other stuff, we just couldn't get a contractor to focus on it. So, you know, we probably lost about three months there while we did that. And then we just made the decision, well, we can't wait for other people. So we're doing it ourselves. And now we're executing it, right? And that same crew, you know, what we're trying to do is that same crew we actually want to use. I'll just go back to the slide. if you can see the slide, Judea South Upper is about the same level and about 600 metres away from that Upper West and Upper East ore bodies, the zinc and the copper there. In either world, I have that same crew and fleet, you know, moving between those two areas, right, to maximise my fleet. So that's why we've defined Judea South Upper, we have a plan, we're executing on that plan. Now we're rolling into defining the plan for those other areas and then we'll try and utilise the same fleet, right?

Okay. So if... Sorry, just last little bit. If everyone hits the first doping or in Q4 and gets their bonus and so forth, then potentially in the quarter or two before that, you might get a tiny bit of incremental development of material out of there.

Yeah, we may. And again, as I said, there's various drill hits and sort of small lenses on the way up to it as well. And so if we're lucky, maybe we get a bit out of that as well. You know, as I showed you the photo... on that vent level that we're driving out there, you know, we've hit a face that's running 15% copper, right? Like that's CSA is you can have those small lenses and you've just got to be opportunistic and take them. Right. Thanks, Mick.

The next question comes from Paul Hissey with Morlis, Australia. Please go ahead.

Oh, g'day, guys. Just a couple of quick questions from me. Firstly, sorry if I missed it, just the potential on your balance sheet restructure, not so much the Sprott pay down, but just the remaining, I guess, discussions around alternative facilities. I might have missed it at the very start. Did you have a potential timeline if we could put Mornay's feet to the fire on that one, Nick?

Yeah, with the April. Yep, April. Just on the refinancing, we're going through that process now. Probably take another sort of six to eight weeks to finalise that. Sort of looking to, you know, obviously extend that debt and obviously convert, you know, if we repay the main facility, then, you know, all the remaining debt to sort of that low sevens interest rate. And, you know, looking to sort of have a bigger sort of, volume facility as well. So it gives us a bit more flexibility in terms of managing our balance sheets from that point of view. We don't pay a lot of money for that. So that's sort of the main things we're sort of aiming for, but that's probably sort of six to eight weeks away in terms of getting there. But we actively engage with all the banks and also looking to add a few Australian banks to the facility as well.

Yep, sure. And just with the SPROP facility, we expect to see that closed out or getting the cash out the door prior to the end of this quarter?

Look, again, it's sort of dependent on how we sort of move through that refinancing process, but that's sort of the same sort of time, six to eight weeks to sort of close that out.

Okay. Yep, sure. Okay. And then just one other question about, I guess this is more a bigger picture strategy-wise, but just running the asset in general. So the vent will come online sort of midway towards the second half of next year. This gets you to 1.7 million tonne, obviously, but excludes QTS upper. Just remind me, Mick, what's the throughput of the mill and sort of where do you, if you can get 1.7 from, I guess, from the legacy operation Clearly, QTS upper high-grade material can displace anything that's lower grade, but what's the medium-term philosophy there around overall throughput with your plant capacity?

Sure. It depends what you put into it, but 1.8 to 2 million tonnes a year is about what you could put into at the front end. The back end will do about 80,000 tonnes of copper and we run it at that. When we have the ore hydrate, we run it at that. We're capped at about 1.7 million tonnes per annum on the water. So our own water, 1.45 million tonnes. The deal we did with Polymetals to secure that extra 150 megalitres of water, that gets us to 1.7. And so we sort of think about 1.7-inch, 1.8-inch you know, our target to get there from all sources. And you've got to think it's not necessarily high-grade, low-grade.

You know, a couple of that.

I'm not sure if it's my end or your end, Mick, but yeah, breaking up quite a bit here. Yep, yep. Look, I guess you've confirmed that 1.8 is the magic number for the plant. and it boils down to where you get the material from to fill that 1.8. The line's really bad. I'll check the transcript after the call, Mick, and if I have any other questions on that, I'll just give yourself or Mona a call directly. Yeah, apologies.

Once again, if you have a question, please press star, then 1. The next question comes from Eric Windmill. Please go ahead.

Great. Thanks for taking my question. Congrats, Mick and team. Hopefully you can hear me okay. There's definitely the lines breaking up a bit here. But just a quick question on the reserve and resource update. Perhaps you mentioned it, but how much new drilling do you think is going to go into that? Or where's the cutoff on the drilling for that?

Well, I managed to get it back online. There'd be 30, 35,000 meters of drilling in the new resource update. The data was cut off. I think it was the end of September, October.

Okay. Fantastic. Thank you. And maybe just a question on the tailings. You're doing this stage 10 embankment now. How long is that going to set you up for it and Do you see where the CapEx is around that?

Yeah, so the CapEx on that's about 12 million US on total, like 18 Aussie. It might come out to be a little bit less because obviously the Aussie dollar's dropped. I'm just trying to find the slide. And once that's built at the end of Q3, early Q4 this year, that takes us out to about 2030. So the tail exam's done until 2030. There we go. So we're spending that money now, and then we're set up for the next fall of use.

Fantastic. Thank you. And maybe just one more question on the upper portion there. I know you said that we'll make it in the resource, but I know so many initiatives there in terms of digitizing and, you know, obviously a little more zinc. Anything you're seeing there you want to follow up on and maybe kind of catch your interest here that you might want to look out for?

uh yeah so you know that that work we've we've got all historical drilling in we've had a huge project digitizing all the old level plans and everything and georeferencing them uh you know as i said there's a there's a pretty high grade decent sized zinc uh ore body sitting at the top there but also you know lower grade you know but but still pretty good grade relative to every other copper mine just lower grade for us um sizable copper deposits sitting up there that we believe we can add a reasonable amount of production. It may well give us the pathway, but that work is underway right now. But again, as we look at what does everyone else have that's undeveloped, I think actually we have a better project sitting up there than all the other undeveloped copper assets in Australia.

All right. Fantastic. Thanks for that. Appreciate it. And yeah, congrats again. I'll hop back into the queue. Cheers. Thank you.

This concludes the question and answer session. I would like to turn the conference back over to Mick McMullen for any closing remarks. Please go ahead, Mick.

Okay. Thank you, everyone. I think, you know, we feel very proud, like the team at Sight have done a great job for the quarter and for the year. You know, it's been a very strong result. I think the company has never been in a better position. And, you know, we look forward to continuing to deliver and I guess, you know, We'd like to think that we're as advertised on the tin. We've delivered on what we said we would deliver and then some. And, you know, we're feeling pretty confident about that mine out there now, about our pathway to organic growth. And that's it. Thanks, everyone, for your time.

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