Pt Vale Indonesa Unsp/Adr

Thank you for those who join Northline and Northline as well. Welcome to Pediatrics in Asia 2025. I'm Sandro Adi and I will be the moderator of today's call. So with me now, we have, I think most of the C-level from your company, while some of them also join online. Q&A session. So during the session, we will share some key highlights about our company from 2025 and then also providing some 2016 outlook. And that includes any operational milestones, financials and updates on our growth projects. Next one. Okay, so today's agenda will be divided into five agendas. So number one, part one is 2021 challenges, and our part forward will be presented by Pantor Orsio, and then followed by a presentation from Pak Budi Awansya, so a bit on the sustainability. And then part two and three, the operational and growth project updates will be presented by Pak Sil, And then part four will be presented by our CFO, Prisky, and so results. And then part five will be presented again by our CEO, Pantori. Next one, so just a reminder that this presentation and discussion comprise assumptions. Again, just for a reminder, I encourage all of you to, should you have any questions, just put it on the Q&A window, and then we can address those questions after the presentation. So, without further ado, I will now hand the session to Baron Cermanto to begin today's presentation.

Yeah, so thank you, Andrew. Hi, everyone. Morning. So, let me begin with a quick recap of 2025, a year where Invalid demonstrated resilience, discipline and also strategy execution despite the dynamic market environment. First of all, I think we successfully strengthened our operational foundation, delivering stable nickel mass production. So we actually exceeded the target of nickel mass production last year, while maintaining one of the lowest unit cash costs in the past four years. If you remember, we started 2025 quite slowly. We had a gap in our production that we catch up in the remaining months in 2025. So this reflects not only operational excellence, but also our ability to manage costs and condition. At the same time, we diversified our revenue stream by introducing separate lines of sales, such as Baudopi. This is an important milestone that enhances margin flexibility and wages reliance on single product line. So on top of Scirocco now, we have Baudopi and Poma as well. So, from the growth perspective, we made significant progress on our strategy progress, particularly in formal line BADOP, while also securing LGAD approval, ensuring continuity of mining operation. And importantly, we navigated operational challenges, including infrastructure disruption, as you know. So last year, we experienced major challenges from oil pipeline leakage. So we ever navigate through the challenges without compromising safety or business continuity. So this highlights the strength of our system and leadership on the ground. So beyond financial and operational performance, we continue to advance ROEIG leadership as well, receiving multiple international and national recognition, and also progressing through to get my certification. So reinforcing our commitment to responsible mining. So in short, 2025 was not just about performance. I think it was about building a stronger and more diversified and also future-ready platform for growth. So I'll hand over to the Network Center. Thank you.

Yeah.

Thank you, Pa Anto, to start.

the description for today's meeting so please allow me to continue everyone so if we see from the sustainability aspect that ppvi still solid performance that from the system analytics achievement that put us as one of the lowest risk in in our business right so 23.7 this is the lowest numbers that we achieve And then also that if you see the key parameters, the key objective for the sustainability, right, for example, for the green GHG intensity, as well as the SO2, which is key premium below the target. However, that if we see that SO2 sulfuric dioxide, that if we see now the the dynamic of the superdick asset situation due to the crisis in the middle is this is our opportunities also that within this year that we keep remaining to put more operation in our efficient mode so um pdvi has recognized also uh through several awards especially through the subroto award which is this is overall including good mining practices in mining mineral resources, activity as well as for the social and then for the others like for the other work related to the sustainability that put PT-VIA in the strong position on this. In the next, as you see that IRMA-PT is one of our journey as well that demonstrate the company's long-term commitment for the sustainability how to be the right nickel producers. So, 2036, we continuing to follow up what become the recommendations from the editors of the IRMA, even though that we still coordinating with them to get the complete report assessment from last year. If you see the milestone there, why IRMA is very important. This is one of the window for us how to strengthening our positions in this industry. That's I think that highlight from my side and then I hand it over to the next presentation.

Thank you, Pak Budi. Good morning.

good morning everyone uh let me speak first from the safety uh performance uh nothing is more important in life that's the main value of all our activities that we do in project and also in operations the company continues to place occupational safety and health is top priority Throughout 2025, the company management along with contractors and partners actively conduct field visits through the leadership in the field we call, as well as the critical control verifications. More than 200 critical risks daily that we visited and also having control over that. This effort strengthening operational disciplines, increase accountabilities and emphasize safety as a top priority of the companies, include operational as well as in the projects activities. This discipline enabled the company to close 2025 without single fatalities. These achievements reflecting the collective commitment of all company activities throughout safety management system. Next slide to the productions. Okay, Petri Valley delivers solid operational performance in 2025 with full year nickel MAP production rising to 72.027. Metric tones, this mark encouraging increase from 71.3 in 2024. In quarterly basis that you can see also the production was only 17,000. Metric tone about 12% below key for 2025. This mainly due to plans of the food industry rebuild that began in November, 2025, and target to be completed by May, 2026, which is a month ahead. Compared with quarter four, 2024, when the progression was 18.5 metric ton, output of the Q4, 2025 is moderately lower, but yet in overall year, full-year productions remain higher year-on-year that we can see in the results on the charts. So, in addition to our core nickel productions, as mentioned by Pa'ante earlier, Vale continued to make steady progress in broadening the portfolio this year, which is through the sale of nickel saprolyte from both Bahutopi and Pomala bloc. Saprolyte all sales reaching 2.3, million ton, which is about 60% actually above of the dual budget. That is mostly coming from the Bahadur B block and part of it is about 300,000 tons coming from Omala block. Next slide. We're moving to the growth project. Okay, 2035 also marks an important milestone of Petit Valley entering the new phase of business diversification through the sale of separate sales and also limited sales that are going to be starting soon. So looking ahead, the company is sharpening the strategy focus through the development of mining project, and downstreaming processing facilities collaboration with our GV partners in three areas. Just to go back in our growth project, there are three areas, which is in Moroali, which is in Bahutopi block, Pomala and Sarawakola Imonite, while Tanah Malia still in development phases, that you can see in the pictures. We have started phase one Pomala, mining operations is July 2027, which is about three months ahead of the plan, resulting higher ore sales in year 2025 that mentioned earlier. We now move into the phase two of mining development in Bahudopi block, which is preparing of the limonite ore sales supplied to Ijpal plant in Sambalagi. The Ijpal plant in Sambalagi also made a significant progress with a plan to have the first mechanical completions by Q4 2026. This space week in Pomawa, our mining project has started now in mining operation, in development of the infrastructure reaching 60%. But again, starting last year, October, we are starting mining through our partners. And today that we are starting also selling our limonite to our APP for each power plant. supply, which is we are planning to have first mechanical completion by Q3 2026. Sulaco limonite also having significant progresses in mining. Now we are actually building our stockpile. We are stockpiling about 3 million ton limonite being secured in stockpile while GV side, the partners now is starting to construct FTP and slurry pipeline. while they are actually securing a land acquisition in the area down in Malidi. So in addition to the discipline of the execution, we also ensuring projects are executed efficiently. For mining projects, the cost forecast approximately about 30% lower than the approved budget. Again, all of the strategic initiatives continue to be executed with prudent financial disciplines, strong governance, and unwavering commitment to long-term sustainability. The next slide is just showing some pictures. If you go to the next slide, which is three areas, as I mentioned earlier, there are about 10,000 workforce now working in the ground. As of today, we are about reaching 40 million main hours, work hours without significant injury, which is, again, reflecting our discipline and execution and also our commitment to manage the project and operations safely. Thank you. Back to Pak Kiki to deliver the finance thing. Thank you.

Okay.

Thank you, Pastor. So I think I'll try to be brief since I think most of you already seen the financial result. Yeah, I think as Panto mentioned in the earlier section that you know, 2025 was not an easy year as well. You know, many challenges coming from, you know, not only operational, I think, in the beginning of the year, but also from a construction point of view. B40 being one of the aspects that was implemented last year. I think in terms of pricing, you can see here that, you know, from an element standpoint, from a nickel pricing standpoint, It was even further challenging when compared to 2024. And the numbers that we presented here, so you see that despite those challenges, right, it is actually showing a stable improvement when we compare to 2024. And this is actually showing the resilience that was mentioned earlier. Production, we can see that from a year-on-year basis, and especially when it comes to production, let us not forget that 2025, there was a period of two to three months of friendliness rebuilt. We thankfully and safely managed to achieve an improvement, whether it is compared to 2024. And also, it resulted in a higher revenue because of the higher production and shipment. But also, aside from that, payability plays a factor, which I think most of you already noticed that starting in July of 2025, we started with a new payability of 83%. And with a good cost discipline, we managed to book a UCC of sales of 9,339. which is a modest improvement when we compare to 2024. But seeing from the perspective of, you know, this improvement is actually on top of the additional constructions such as B40, such as the inclusion royalty. And of course, I think in terms of how we mitigate our safety and also operation in terms of oily compensation, oily incident, we still manage to improve the cost base of the operating company. With that, we end up with a good EBITDA figure of 228 million, which is a 1% improvement against the previous year, which then trickled out with a net profit of the level of 76 million for 2025. It reflects as well that, you know, from a cost avoidance point of view, it bears fruit that, you know, net profit can be higher as well, right? And from a cash and cash equivalent, we managed to keep a good amount of cash to start the year of 2026. Next slide. So, yeah, I think this is showing that we are ready for growth, right? So we ended the year with still a good amount of cash. But I think one important point is that, you know, progress on the ground is looking good, which comes with a significant amount of KPEX and commitment going forward. So this is a bit of a guidance of how much KPEX that the company will be committing for the next three years. And I think we were happy to announce that actually as of today, we already have a standby facility to support this commitment going forward, which is sustainable with 500 million USD facility with a green shoe option of 250 million. I think you can see that from previous communication up until today, we've been executing the commitment and Even previously when we compared to the, you know, prior decisions, it had been actually quite faster than, you know, like for instance, the Badobee mine actually entered into commercial operation quickly compared to the previous investment decision. And then I think Mala also starting this year, we already showed, you know, the operation is actually on track. So hopefully this commitment, going forward will also show a good timeline when it comes to execution. I think that is all from my end. I will give it back to Paha Aguttho for 2026.

Yeah, so moving into 2026, our strategy is quite clear and focused as well. So one, typically we need to deliver the good agenda. I think as Pasha mentioned earlier, Pumala, Baldupi, Sirocco, Project RL, you know, on track. Schedule as well as the cost and then quality. Second is maintaining discipline. And I think the trick and the most important thing to me is we need to unlock the profitability of the company. So first, we remain committed to financial discipline while we are entering the investment intensive phase. Pakiki has mentioned about that one. So we are carefully balancing growth with resilience. I think... show up as the backbone of the company, you still need to pay attention to it. So probably by approximately, and then Paki has mentioned, right, so the sustainability link on that, which is explained, you know, which strengthen our funding visibility. while aligning as well with the ESG target. It's something that we are quite proud of. I think, you know, like probably, you know, of all the mining projects in Indonesia, I think we are the first time to get this autonomy-building loan, which reflects also the trust from the lenders. Second, we are focused on scaling the production and diversifying revenue. I think with dual operation coming online in Pomala and Bargopi, alongside our core Soraco asset, we are building a multi-sources production base. I think it's going to be very good because we're not, you know, we're no longer depending on one sources. We will have different sources as well. At the same time, our sales will continue to be meaningful contributors. Hopefully, and I, I'm confident that we can get the LKB efficient for POMA and DoPI. So it's going to be, again, I think it's going to be a meaningful contribution for the company in 2026. Third, we are accelerating downstream expansion. As you mentioned about the Pomala, the mechanical completion for Pomala is going to be in quarter three, sometime in August. It's going to be another milestone for the company. And in parallel, we are developing additional processing capabilities over here. I think it's not new. We discussed about this one. We are assessing the possibility of actually capitalizing as well, the order that we have. You heard about OSPF, for example. So if we can actually do the file, which we built, But we need to be mindful of the market situation as well. So finally, and most importantly for investors, for analysts, we are sharpening our focus on profitability. So unlocking the values and profitability of the company is our focus. think through discipline, cost management, you know, and again, sourcing optimization, energy efficiency initiative. We have a crisis now, right? The Middle East crisis actually have an impact on us. And I could confidently that probably among the EDI that we got because we have hydro plan, we are the most ready in anticipating the crisis. And we are targeting a clear improvement in earning, starting from 2022 and forward. So, all of these initiatives are anchored in one objective, to position Midi Valley for sustainable earning growth and long-term value creation. So, we're not just growing, but we are growing strategically and also responsibly. So, that's close my presentation. Thank you.

Thank you, Wanto. Thank you, Yuri, for So year 2025 was solid, not only reflecting our company's resiliency, but also at the same time putting like a good foundation for future growth in the future. So I think next one will have the Q&A session. I will encourage all of you to ask. I'm going to give like the first opportunity for those gentlemen and ladies who are attending offline. This one's in your name and you're in Zoom. Thank you, Panto, and the management team.

I'm Ilham from Manuscriptus. Maybe my first question is on the cash cost. Is there any guidance for this year?

How much do you think the cost will increase from the current situations? And maybe on that cost part,

maybe some kind of negligible power toward your mining contractor.

I think the last time I talked with one of the mining contractor business, they said they're starting to see some kind of price war within the mining contractors because they are trying to secure as much as volume related to the government's plan to cut the production volume for both nickel and gold.

Maybe that's...

So I think in terms of cash costs, so when we compare to last year, probably it's going to be a bit higher because again, I think it's going to be one of the main factors. We expect, hopefully, anytime soon, before May, we can complete that. But meaning that, you know, some portion of the MAP production will be lower compared to last year, which will result in a bit of a higher cash cost. But we see that probably within 10,000, it's still going to be manageable, hopefully. And I think this is also related to... with how we can actually mitigate the situation of the current energy crisis and also coal, which is showing a similar trend at this point in time. But I think one important point that I would like to convey is that We're quite ready. I think Banro mentioned we're not one of the most ready in terms of facing that situation, especially given that the hydro power plant that we have as the mix. But on top of that, I think inventory management is also one of our strengths. For instance, when it comes to sulfur, we have quite a good amount of inventory balance. We have up until I think the end of third quarter or maybe the early of fourth quarter to start the year. I would say that in that sense, security of supply, in that sense as well in terms of inventory pricing, should be reducing the pressure for the company to continuously produce nickel-marble. And on top of that, I think in terms of oil, in terms of coal as well, we also have a good amount of weeks of inventory balance. And also, since last year, we've been increasing the procurement category to actually support the competitiveness of our sources. But for mining contractor, I think LITRA may be faster again for the ad. So I think that is actually quite a good amount of confidence level that, you know, we have a long-term contract with. It's a long-term contract, a big amount of tonnage that would be, you know, operated for the next 10 years. So what we see is that, of course, we have a room for negotiation. What we see also, I think... The coordination has been quite smooth for us with the mining contractors, both in Badupe and Bumala. And I truly agree that one of the most ready to capture volume should be on the contractor side as well. So we will continuously have the discussion. And I think Basril can later on mention that the cadence is also showing a good, you know, discussion with the management of the contractors as well. Maybe Basril, anything to add?

Okay, thank you. Just to add on that, thank you, Kiki, that we have very close collaborations and also coordination among the three contractors meeting us, Petrosi, PAMA, and also IMN. In terms of the contract, that we have a rise and fall mechanisms in the contract says that they're quite fair for both actually PT Valley and also the contractors, you know, toward the cost of mining today. But for sure, despite that we have a rise and fall mechanism, we are actually discussing the impact of what's what's going on today right for both sides to have really close coordinations how to tackle the situations again in terms of how to be more efficient in mining operation for example that probably in some something that we are following up is basically in the mining side mechanisms saying that okay let's do the mining increase the volume but reduce the distance for example and some improvement that we made in mining operation as well as in the in the hauling and also in the planning as well. In terms of the volume, probably just read a bit on that actually because of today that we are having RKB for sure for both Pomala and Bahudopi. We're aiming to submit the revision one. But for sure, increasing volume with the current prices is one of our targets. Again, to be more efficient in mining operations. Today, it's still in the level of the

the the good uh cost comparing with the margin that we are having today in mind but for sure it's really close uh coordination and loss plus control over the the mining cost and operation thank you probably just give you know provide a bit flavor about the situation right that we've been facing about about the cost pressures um you know we don't know how long this is going to be happening So for Fidi Bali, I think the situation, yes, it is a risk, but I think we need to see the risk from the positive angle in the sense that, well, we have to find everything about our operation as well. So just to share some of the discussion and ongoing initiatives that we have. So one is about supply resilience, right? So, okay, the concern is about, okay, you know, like we all talk about, you know, how high the price of oil and sulfur and coal is going to be. But the more fundamental question is, like, are they going to be available? Right? So availability and prices, you know, is real risk, right? So the more we can be less dependent on those commodities, the better for us. So, we have actually started this. I mean, lucky enough that we have started some of the initiative even before this happened. For example, in our Sirocco operation, you know, like we use sulfur as well for the nickel malt production in Sirocco. So, we have done trial to replace sulfur with pyrite. And that trial seems to be working quite well. So that's actually defined by the fit, the supply, the bulk that we need. And then we are now coordinating with our buyer to ensure that the product is actually also acceptable. But if it's actually working well, then it's actually off. Don't worry about sulfur. So we have an alternative solution. And the other point as well, like, okay, we also try to, again, reduce energy consumption, reduce fuel consumption, and you know that we have started the trial of electric truck. The other day, we have set a quite aggressive target. accelerating the adoption of EV as well, the trial is happening, looks good, but it needs more time really to conclude. But I think 30% of the whole EV truck population by 2030, that's going to be our ambitious target, if not more. But basically, it's actually limited as well by the availability of the hydropower. And then, you know, we try to review whether we can actually remove drier, whether we can actually, you know, go directly from the mining to kiln. So, a lot of initiatives that we are doing now, it's not going to be happening this year, but, like, some of the initiatives, like, we are dewatering, we hope that our dewatering you know, how to naturally dry in the ore, you know, from the mining. And if this actually works, and we have done some trials, if it works, it can actually reduce the moisture and reduce the oil consumption. So we want to actually reduce as much as possible to technically, practically possible our dependency into fuel, into coal, into sulfur. And I think it's progressing well, and we made some commitment, and it's going to be our legacy. This board of directors legacy, we can actually transform SOAP operation into less dependent, into those three commodity, and that's actually also increasing our resiliency to geopolitical risk. Okay, thank you, Panto.

It sounds like you're discussing the idea

I have three questions. First of all, is that house ESP for your separate for sales in Bahadobi and Humala? Is it already contracted or not? And also for the unit cash cost in Bahadobi, it's about $18 per 100 ton. Can we use this unit cash cost of sales for Humala also? And the third one is the consumption for Oomala EFL is still about 53% and your target is not in 2023-2026. Is it achievable or not?

Sorry, can you repeat the question?

So, yeah, I think the average selling price, whether it's already contracted or not, that's the first question. First of all, I would like to say it's still a premium market. So it's still a premium market that we're working. And especially when it comes to first quarter and then moving you know, a higher premium environment when compared to last year, right? Unfortunately, I cannot mention specifically the pricing today because, you know, we haven't released the first quarter number, but I can safely say that there's quite a good amount of increase from the previous number that we showed for the average for 2025. So, yes, I think that's in terms of pricing of the oil. And whether it's contracted or not. So, I think... So the total quota that we have as of today outside of Sarawak is around 8.1 million. And we have some portion of maybe around 2 million for limelight. So it's basically talking about the remaining 5 to 6 million, right, of satellite. We can safely say that the majority from that portion have been contracted. What we see is that it's actually a good timing from a risk mitigation point of view. So it's a good timing for us to lock the good pricing environment. I think, you know, there's, of course, there's an opportunity, but there's also a risk that we need to see, right, when it comes to pricing. So a big portion, I would say, out of the supply that we have, have been contracted up until the second half of the year. And for the second question, $18 cash cost, right, including royalties for BADOP, whether we can use that for Pomala or not. Conservatively, yes, you can use that. But, you know, when it comes to Pomala, actually it's a larger scale. So, you know, scale and efficiency, meaning that there is actually an upside, you know, towards the lower scale of business rights. What I'm saying is there is an opportunity for it to become lower than $18 for Pomala. But, yes, I think conservatively you can use that as a base for Pomala. Thank you. Asadul, I think for the third question. Yes, go ahead.

uh if you understand correctly about the formula project for both mining and gv uh even though that the progress of mining is reaching only 60 percent but we have actually two milestones the first milestone destination here is 60 percent overall project the second milestone is about our delivery or operation delivery as i mentioned in the project presentation we started the mining operation in pomala since last year october and today we are starting delivery the ore uh pp uh limonite and also we just starting also last week ago of delivering also the supper lights now we're preparing to deliver supply to the port yeah we are aiming to to starting in april so having said that in mining i can say that we are ready to supply off our ishpal plane in pomala in each side again this is 60 or 60 percent is reflecting the overall progress Just to also to recall back again, our partner starting the construction in Pomala is just effectively last year, February 2025. So we think this year, we think February to February one year is reaching 60% is quite significant progress in quite fast. so when we see things in the ground today we strongly believe that p3 is is really achievable and now today they are starting to testing some of facilities include the ishpal plane apps pipeline already being installed and also lng plane that's already is starting to be commissioning today uh called commissioning so those are physical construction in the ground uh make us believe that uh the the the plan that we are putting there Actually, three months ahead of the plan is achievable.

Okay, thank you. So, I think the remaining work to be done is actually installing the autopilot. And the autoclub actually arrived already on site. So by quarter three, the first autoclub is going to be installed, done. So first mechanical completion is one autoclub. Subsequently, the other autoclub will be installed. So by quarter one... installed already. So the first mechanical completion is one Autoclub and in such a few months, like the other Autoclub is going to be installed. So hopefully for the one, 2027, the whole RF line is going to be in place.

Thank you. Mila, from the floor.

How big is the energy cost to the Autocorps and how long the core I mean, for how long the fuel inventory, or is it like two months?

Yeah, so I think for energy mix, it's still the same, right, with the previous year. And you're referring to the nuclear method? Yeah. Yes. So it's 30% to 40% for energy mix. But again, when we talk about 30% to 40%, there's a portion of hydro to that as well, right? But in terms of inventory, so I think this is one of the good legacy I would say that Mali have been providing us when it comes to BCP. This is continuity, right? So we've been comparing our inventory balance and we have, you know, around two months, which is quite good compared to the average industry. And you can see the software one, software 33 weeks, 35 or 33 weeks of inventory. Up until September. So we can say that up until the end of September or the month of October, we can still, you know, use the inventory that we've been carrying out from last year, right? I think one of it, but I think, yeah, one of the stress points is actually what Bapu mentioned before, to reduce consumption, you know, for the drying elements and the kiln. so that going forward, we can actually reduce the dependency for suppliers.

If, for example, the pirate works well for sulfur, and the sulfur consumption is actually going down, and it's probably safe until the end of the year. So, as you can see, it's the balance.

And even that we established the ad hoc committed who will closely monitor the current situation, right? Even though that we have good inventory, but our team continues to closely monitor the situation, then bring us day-to-day, daily, or weekly visits from the clients. Okay.

um probably before going to i think we need to look at uh the online online questions so we have the first question coming from parlas from mirai so can the can the management give some color regarding their forum for the rupee and formula or for this year considering the you know the rkb quota cut by this year any strategy to yeah i think i think you can just mention right so what has been approved

total is about 8 million, right? And one of the strategies typically is to optimize the 8 million, right? Showing that we actually are able to actually to produce as well approved. I think the problem for last year, I think the government also learned that there are so much being approved that the actual production is not that much. Well, that means that some of the minor didn't produce as what has been approved. So one of the strategies really to show the government that, yeah, we can actually do what we propose. That's right. So we want to optimize that up to June, July. And secondly, remember that, you know, we have commitment to our partners, to our GPs, right, to supply the landowner to do a spot off. So we will and we are now engaging the government, the FDM, basically, to show them that the progress of the project is there. It's almost there. And we all need to be stocked up already, right? So it's not only about, you know, we are actually trying to monetize the ore, but we are actually fulfilling our commitment to our partners. And by the way, the commitment is actually mandated by the government as well, by under IUPK. So we want to continue. And we actually, you know, as we speak now, we're preparing all of the revision already. So we prepare all the data. We actually informally also consult to SDIM whether the data is enough or not. So hoping that by the time the window open, we are ready because all of the data are ready and they already understand the data. So, you know, hopefully that it can be done quickly. So, there are several possibilities, you know, and I think the government, AISDM, is also requiring some regulation related to that, whether it's going to be reviewed quarterly. For example, we heard about that one. If we refer to the regular, you know, like the normal regulation, the window for the RKB revision is going to be in July, right? But that's the normal one. But facing the situation today, uncertainty, I think they are preparing and reviewing the total RKB quota realization quarterly. If, for example, some minor will not produce as much, they will be reallocated to the others. Probably that's the idea. And then also looking at the market dynamics and probably the possibilities to increase the quota and so on and so forth. So we are closely engaging with the government. But at the same time, we are also showing them that we are able to deliver what we propose. We have a commitment to fulfill. And then, you know, we are ready. That's free to ask. So that's more or less, you know, the strategy of the approach.

Thank you, Panto.

Sorry, I have to move. Sorry for all that. I need to move with the stakeholders there. They came from Sulawesi. Thank you. Thank you.

So next question, we also have, like, coming from Emily Melusia, participant. So the question is related to HVAC utilization rate for this year. So could probably management provide some guidance regarding the HVAC utilization rate?

Probably that's something that... I think Paolo can answer, but specifically, I think I've mentioned, right, so it's going to be, in terms of mechanical completions, it's going to be gradual, from first mechanical completion for one auto club on your quick mechanical condition that I think as per now there's no plan to reduce the okay to reduce the ramping up right so we will still actually you know doing the ramping up as we planned before I think especially for sulfur I think the HVAC what HVAC need for leaching is sulfuric acid it's not sulfur per se right but sulfuric acid can be produced I think finish educated me about the sulfur market. He went to Bali for the conference specifically for sulfur, so finishes you can add, right? So the sulfuric acid can be produced from sulfur, and that's what, you know, a lot of the H4 producers actually doing. They buy sulfur, they burn sulfur, they produce sulfuric acid. But sulfuric acid can be produced from other sources as well. So sulfuric acid is not as bad as sulfur, per se. Because there are many different sources of sulfuric acid. And you know China, right? So when it happened, they have already changed beyond what we possibly think. So they are actually looking for alternative sources. Finishers tell me about, oh, they're actually building now from, Phospho-Egyptian, right? So, it's actually the solid waste from phosphate, right? From the fertilizer production. And they actually produce sulfuric acid from that. So, they're so creative, so innovative in capturing any values from that. But again, I think Vinicius, you can add, but we are not actually revising the ramping up plan. So once actually done, it's installed, then we will ramping up as per plan. But Vinicius, please, you can add.

Yeah, so we say that SOFR now is like a SOFR refineries in the Middle East that was bombed, so the supply was deeply affected. But as Anto said, the Chinese are coming with R&D, because most of the sulfur comes from oil, gas, so they are now bringing optionalities to bring sulfur from other, like Gibson, like Pyrite, and like tailings as well. So we will see the midterm, I would say six months, one year, Chinese bringing, when I say Chinese, our partners bringing options like Pyrite. Pyrite, you know, you can produce sulfur, but Gibson is something new. And in this seminar, I saw their companies already building sulfuric acid production from Gibson. Gibson is commonly find in Indonesia, everywhere, yeah. So, and that's the trend. So, we have sulfate or sulfur in a lot of other elements rather than the oil, and you will see this coming as an option. So, in average, what the Chinese producer are trying to do is to recirculate more, recycle more the to buy less sulfur from Middle East and have less dependency on this market. So, they so far are confident that for our two JVs that we will hump up this year, we still have time to build our, let's say, optionalities to the sulfur from Middle East. Like I said, Pyri, Gibson, Octavius. that we are going to see, which is good. It's like COVID, when COVID come, online meetings suddenly come. So, we will see production of sulfuric acid from other source rather than oil, which was a good push from this war.

Yeah, and you know, I think you told me as well, I think longer term, they might replace sulfuric acid with other acid for the leaching. And so this hydrochloric HCl, that's another option for the leaching, but it's probably more mid-longer term. They need to study that. They have to do some research on that. And HCl is much more easier to produce. compared to sulfuric acid. Hydrochloric acid can be produced from seawater.

The new, let's say, the new generation of H-PAL, let's say two years ahead, we will see is less dependent on the acid from sulfuric and more from other kind of acid, because what you need is to change the pH coming from hydrochloride, which is one option, which is from the sea. So, yeah, good that R&D is moving fast, and we can see that this is putting us some alternatives, not competing with fertilizer, food, which will be really tough if we put this aside. Okay, thank you for the opinion. Basil, you want to add something?

Just read on the HPAL, actually, again, what Panto said. Basically, the plan is to have first American completion by September. So, one by one. So, we have five auto-clubs, September, October, November, December, and January. So, by January, OK, 2027, we are aiming to have full production in HPAL and Pomoda. Thank you.

Okay. Thank you, Pastor. Okay. So, I think next, Cynthia. Okay.

I just have one follow-up question when we're talking about the revision window for IQB. So I understand that the quarterly review period is probably something that we can expect for like next year or the next two years. But for this year, have you been hearing the window for the revision to be accelerated to maybe like April or June? sometime earlier than June or July. That's my first question. And my second question is, how flexible is your mix of between Saperlite and Lamel for this year out of the 8 million tons that you have gotten the RK before? Say the government suddenly releases like a new HPM or HPM and then they consider like cobalt contents whatsoever. Will you be flexible enough to say, like, move some of your production to limonite since you have interest to stockpile for your HVAL and you have a higher ASP for limonite by then? Or how flexible is it to mix between those two? Thank you.

I think, as I mentioned, there's a possibility for the reaction window to be earlier than June 2. That's what we're discussing, and we try to approach, try to also consult with the government to be able to do that. Because otherwise, everyone's actually submitting their reaction, and I do believe there will be a lot of companies submitting their revision on June 2. It's going to be complicated. is going to be closer to the end of the year. And so that's the issue. And I can see that that possibility is there. But about, okay, what happened? Is there any flexibility? You know, like the mining plan, but basically for the way we define the mining plan is really to supply the as far, right? So that's the main focus. Unfortunately, the SAP Pro Lab is kind of seen or considered as a byproduct of LAMONET. Because again, I think the main purpose is really to supply the LAMONET into each file. And then that's what we are focusing. But again, I think things might change. But it's not as easy as just flip. Okay, let's now increasing this type and reducing this type because it requires a lot of recalculation, a lot of consideration as well. But what we found is you can have that.

Just to add on that, again, the basis of RKB is feasibility studies that we have to submit and approve by MMR as well. So in terms of the flexibility, again, we are actually looking for, again, the demand of our partner for sure, that basically, as I mentioned, that in Pomala is much more advanced compared with Mahodope, for example. So we are actually focusing on developing mining, specifically in limonite, in in today uh but we should not forget also bahadobi because of we have also partnered that again as i said earlier that they plan to to have mechanical completion by k4 2026. so we have to balance on that too and also again because the high price for sure today is in this upper right side so uh again when we mining supply remaining limonite so balancing in operations okay the planning in mining again as i said also that we need to see and control the cost in mining for both and comparing the demand we are actually playing on that uh for sure and at the end of the day is subject to rkb uh the windows as part to say there are some opportunities probably earlier that we are now having some flexibility actually in the planning, but again, considering all of those factors that I mentioned earlier. For example, let's say we are delaying a little bit in Sambalagi, so we are probably shifting a little bit more in subprolite and soft piling more in limonite. So we are playing on that, but again, our reference always be at maximum level in the feasibility studies as a reference of RKB submission. Thank you.

But is it true that I understand your first half will be majority Cyprolight? Of course. But if we are targeting for a mechanical completion of the HVAL by the 34th year this year, is there any comfortable level of inventory you need to have at your HVAL to start running the HVAL? I mean, say you don't have any revision for the second half, you cannot mine limonite for your HVAL. What will happen then?

I still have a problem.

Yeah, I can answer that. Actually, as I said that, when we see, for sure today, when we see the target plan that given to us from our partner, for example, Pomala, the demand for this year is about 8 to 11 million ton of limonite. Okay. So, and therefore that in mining and also in HVAL plan that also we are also building a big, huge, huge soil pile. okay so this is for preparation for us to be more flexible in the in the mining operation also to supply to our partners okay so so let's say that we are fulfilling their commitment to build and the mechanical completion and they have to go that way for sure for sure we have to mind more okay uh as according to the plan in our fs type today in our feasibility status today in pomala uh we are actually 30 percent uh higher higher than the demand of limonite okay so we have flexibility to go on budget or we go beyond again depending on the stockpile estimation okay so on that sense again again we much more flexible today as we speak but again this is subject to fkb okay approval later on okay thank you hopefully this answer your question thank you thank you

Anyone else?

Regarding the tarmac, because you have the option to own 30% in the next part, when will be the tarmac since it will start to operate? Are you waiting for it to be a bit more positive or what is the consideration for the tarmac? And also maybe on the royalty height, we heard that there is another royalty height because of government need some revenue statement.

Yes, okay. So the first question is about when we will start the college. So ideally, you know, again, before entering into the college, there will be a due diligence process, right? And when it comes to the villages, it's not only covering the financial result, which is, as you said, positive numbers, be it a bit of profit, but also it's about specification and also reliability, right? So most definitely would be post the mechanical completion of all the auto class, right? So third quarter, Sometime in August, September, it's probably going to be the first autographs and then gradually, up until the end of the year, we'll complete all of the five, right? So, it will be a 2027 execution. I think it was actually also reflected in the previous CapEx guidance as part of the 2027 equity injection. And I think that hopefully that answers the first question. For the second question on the royalty high, from what we understand, I think there are two significant reviews, at least from the government, that is still ongoing. The first one is the high, the upper end of the award. And the second one is an increase in royalty. Hopefully this is true, but what we understand is that if one of it is actually coming out in the market, then the other one is actually not going to be as an addition. So, what we've been hearing in the debate is actually of which part that is going to be, which initiative or regulation is going to be out to the market. We haven't heard any formal announcement yet, but I think looking at the news, same as you guys, you can see that I think the pricing is currently being more aggressively announced, probably testing the market as well. So, hopefully that is actually going to be the case for the new regulation.

Just a few questions from my end. I think the first one is with regards to the oil leakage. Any kind of numbers that we should be expecting at least for this year, or as everything has been completed by the 4Q25 last year? Second, I think that's with the mining cash costs being $18. Given the recent fuel price hike itself, what kind of reasonable numbers I should be expecting to be going on this? And lastly, I think just a few updates on Tanahumara projects.

Okay. I think later on in the past, we can have the third question for Tanahumara.

okay okay so maybe bathroom uh but the third question first before you take off sorry sorry so sorry just to understand better uh it's about tanamalia project right the progress

Yeah, as I mentioned also that we're still in developing stages in Tanah Malia. Today, our team is working in Devel 2, while we are actually working with external team, with Budi Awansa team for our plan to get into the area to start drilling for Devel 2 as well. Okay. While I think from partner point of view, we are in progressing also to select the partners. Probably later, Chief PT can explain the latest status. But I think we are very close to that partner selections.

So I'll continue with the first question, which is OILIC. Right, so I think if you notice in the financial report, the audited financial report that we disclosed, there was a rehabilitation cost section in that, and it showed quite a good increase from the financial report. That number, that increase is actually not an actual number, but also provisional number, right? So I think what we can safely say is that, first of all, a majority of the portion, be it from a compensation point of view, be it from infrastructure upgrade or enhancement point of view, the costs have been majority deployed in 2025 with some provisional number that have been provisioned in 2025 as well. Of course, there is possibility, you know, some additional number, but it wouldn't be as significant as what was in 2025. And I think on top of that, what we would like to mention is that we have an insurance claim that is ongoing as well. So as of 2025, it was only a minority portion that was actually claimed. So I think that will be actually a counteracting to the cost that have been incurring in 2025 in relation to oil recompensation. For the second question, I think it was which is especially for the mining contractor side. So it's going to be hard, of course, to provide sensitivity and how it will be directly impacted the rise and fall. And there will be a negotiation process to that as well, right? But I think there is a counter effect when it comes to the existing cost base. When we see the $18 that we have today, it's only a small portion that we work with. and then come scale it, because there's a fixed portion over a portion. So there is a room for $18 to actually improve. What I'm trying to emphasize is that probably using a base case of $18 would still be relevant in hoping that we can absorb any possibility of rise and fall in the contractual costs.

Thank you. Thank you, Baraki. I think last question from the online person. It depends, right?

So, of course, when it comes to market change, there is an avenue for that, right? And I think not only on price, but also on volume, right? It's also talking about availability of supplier commodities, right? So, yes, if there is a significant change in market situation, we actually have that avenue. So, but I think the main hope is actually for this not to be too long, right? I think that... It's a reasonable contract that we have with the buyer. So if such a situation actually worsens, then definitely there is an avenue for that. But hopefully anytime soon the situation can be resolved.

Thank you guys. Okay, final round for the offline participants. Maybe I just want to try to understand how the mining practice is on the ground.

You mentioned earlier that today's, especially this year's production target is 8.1 million. Is that possible for you, say, to take more force and put it as kind of like inventory so that by the time you get the approval from the archival revisions on the second half, you can actually accelerate all the process, because considering that it takes the government three months to approve this, this kind of thing.

Good question, but I think Basri is still on.

Sorry, can you repeat the last part of the question?

I just want to try to understand how the mining practice is from ground. Is it possible for you to dig more ores beyond the 8.1 million target during the first half? Yes, actually, thank you so much. Actually, we have our own strategy. the the the the aim for us is to improve to increase our inventory the inventory can be true right the inventory can be above ground or below ground what i'm saying below ground is in in in the mining which is we are actually preparing the stripping most stripping opening area so whenever we ready to get more we get more uh for example then we can go immediately to mine today today in pomala in bahut our our mining fleet is still in the full productions target not in the approved rkb So basically we are ready. We are not necessary to mobilize more equipment leaders. The same saying, they are actually today job is to open more phase ready to go when we get more, what do you call this, get more FKD. And the same time as I said, above ground also preparing huge, Especially in Pomala, huge stockpile available. So we put there actually. Actually today we consider, to be honest, in Sirocco, limonite is basically waste. So we are actually putting into the stockpile and ready to go also when we get more. And the third one, I don't know if this is mentioned earlier, our mining in Pomala and Bahadopi, in our mining plan and life of mine, the grade is about 1.7, 1.8, 0.6. Actually, market today's demand is about 1.5%, for example. So, meaning, we can get more volume, actually, if we're blending in more. So, then we can mine the transition zone between limonite and saprolyte, right? So, we can get more volume, actually, there when we're mining both saprolyte and limonite. So, those are the strategies I said. resources enough to do the work we open more space ready to go again with the aim we pray for together that to get more quota according to the budget that we are gonna submitting uh in the near future okay thank you hopefully this answer a question thank you okay i think that will be our

Thank you very much, everyone, for attending the conference call. Hope to see you in the near future for our first quarter. Thank you very much. Goodbye.