Capstone Copper Corp.

Good afternoon and welcome to the Capstone Copper Q4 2025 Results Conference Call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call, you require immediate assistance, please press star zero for the operator. This call is being recorded on Monday, March 2, 2026. I would now like to turn the conference over to Daniel Sampieri. Please go ahead.

Thank you, Operator, and thank you, everyone, for joining us today to discuss our fourth quarter results. Please note that the news release and regulatory filings are available on our website and on CDER+. If you are logged into the webcast, we will advance the slides of today's presentation, which are also available in the Investors section of our website. I am joined today by our President and CEO, Cashel Marr, our SVP and Chief Operating Officer, Jim Whitaker, our SVP and Chief Financial Officer, Raman Randhawa, and our SVP, RISC, ESG, and General Counsel, Wendy King. During the Q&A session at the end of the call, we will also be joined by our Head of Technical Services, Peter Abelungsen, who is available for questions. Please note that comments made on the call today will contain forward-looking information within the meaning of applicable securities laws. This information, by its nature, is subject to risks and uncertainties, and actual results may differ materially from the views expressed today. For further information, please see Capstone's most recent filings, which are available on our website at www.capstonecoffer.com. And finally, I'll just note that all amounts we will discuss today are in U.S. dollars unless otherwise specified. It is now my pleasure to turn the call over to our President and CEO, Cashel Maher.

Thanks, Daniel. And hello to all of you dialing in from the Americas, Europe, Australia, around the globe. Today we are pleased to present our fourth quarter 2025 results and achievements. 2025 represented an inflection point for Capstone, with record copper production and EBITDA generation, driven by execution of growth and a commitment to operational excellence. 2025 was also marked by the delivery of several key catalysts as we continue to grow. including sanctioning of our high-return Monteverde optimized project and unlocking the value of our Santa Domingo project through a partnership agreement. This year, we are focused on disciplined execution and reliable results from our portfolio of assets. This will ensure we are well-positioned to advance our next phase of value-free growth. Starting on slide five, In Q4, our operations delivered record consolidated copper production of 58.3,000 tonnies at a record low consolidated C1 cash cost of $2.31 per pound. For full year 2025, we achieved our production and cost guidance, producing a record 225,000 tonnies of copper at a consolidated C1 cash cost of $2.44 per pound. This represents a 22% increase in output compared to 2024. During 2025, Mental Bird 8 increased its copper production by 65%. We achieved above design capacity at various points in 2025, culminating with our best month of the year at close to 37,000 tennies per day in December. In 2026, we look to build on our success as we execute on Mantoverde Optimize to deliver meaningful incremental production at a low capital intensity. Mantos Blancos had a very strong year, achieving a 25% increase in output over 2024 and exceeding the top end of its production guidance. Our team is hard at work preparing the Mantos Blancos Phase 2 study. which contemplates a low capital intensity brownfields expansion to increase throughput using existing sulfide mill capacity. Arizona was impacted by severe drought conditions during 2025, which resulted in constrained throughput at our Pinto Valley mine. For the next couple of years, we have a solution in place to mitigate the risk of impacted production from droughts. Meanwhile, we will continue to progress the implementation of our asset management framework to improve the reliability of the operations, including a longer-term strategy around water. District growth optionality continues to evolve, and we remain committed to unlocking the significant value of Pinto Valley, an asset strategically positioned in the United States with over a billion tons of resources. Cozumel delivered another year of strong performance in 2025. The site achieved towards the high end of its production guidance range, marking the third year in a row increased copper production at Cozumel. 2025 was a remarkable year for Capstone, with record results across the businesses highlighted on slide 6. our diversified portfolio of operations delivered within guidance as we ramped up projects at Manto Verde and Mentos Blancos, providing a strong foundation of growth. We advanced our peer-leading growth pipeline on a number of fronts, including de-risking and unlocking the value of Santa Domingo through a joint venture partnership. Meanwhile, on the corporate side, we enhanced our financial position through our balance sheet refinancing strategy, and achieved a significant reduction in debt leverage. We will continue to build on this success in 2026 as we focus on delivering dependable operational outcomes. We will also advance our pipeline of executable organic growth opportunities, including delivering Mental Verde Optimize and advancing Santo Domingo towards a sanctioning decision. as well as progressing studies and exploration programs. Meanwhile, we will continue to capitalize on strong commodity prices by deleveraging through internally generated cash flows, ensuring we are well positioned to advance our growth strategy. Our recently announced guidance, as outlined on slide 7, forecasts total consolidated copper production of 200,000 to 230,000 tonnies at C1 cash costs between $2.45 and $2.75 per payable pound of copper. This represents largely stable production compared to 2025. While cash costs are expected to increase, driven by the impact of lower grade zones in the mine sequence at Mantos Blancos and Pinto Valley, combined with modest inflations. Our portfolio of pure play copper assets provides upside to strong copper prices, with the potential for continued cash flow generation to deleverage and reinvest in our pipeline of high-quality growth projects. For 2026, sustaining capital is forecasted to be approximately $270 million. As we continue to focus on optimization and improvements through our asset management framework, as well as ESG and tailings initiatives. Expansionary capital guidance of $225 million is primarily comprised of $150 million to execute Mento Verde Optimized, as well as $15 million at Mentos Blancos and $60 million at Santa Domingo to advance future growth at those assets. Capital stripping and exploration are guided at $225 million and $70 million, respectively. Moving to slide eight. The year of stability in 2026 will set us up for a strong 2027 and beyond as we work towards delivering the next major change in production with Santa Domingo. Taking a look at the bigger picture, the chart on this slide illustrates what sets Capstone apart from our peers, and that's our sector-leading permitted and executable growth. Over the past two years, we have increased copper production by 37% and decreased unit costs by 16%. That is a significant accomplishment in our industry and a testament to the executable nature of our growth opportunities and our best-in-class mine build and operating teams. Looking towards the future, our permitted growth pipeline alone has the potential to increase production by a further 70% and decrease unit costs by 30%. Beyond our permitted growth stands a robust pipeline of low-risk, high-return projects in top-tier jurisdictions. This includes a brownfield expansion at Mentos Blancos to drive incremental copper production, optionality to unlock synergies in the MVSD district, and the potential doubling of the capacity at our flagship Manto Verde operation. Our growth strategy is well supported by a strong copper price environment and growing consensus of increasing future demand reinforcing the importance of retaining optionality within a portfolio to drive returns. With that, I'll pass over to Raman for our financial results.

Thank you, Tasha. We are now on slide nine. In Q4, strong copper production and commodity prices drove record quarterly revenue of $685 million. Copper sales were around 2,600 times below payable production levels primarily due to timing of sales in Manta Verde, which would have increased EBITDA by approximately $24 million. L&B copper prices averaged $5.03 per pound in the quarter, up 13% compared to $4.44 per pound in Q3. We realized a higher copper price of $5.36 per pound. L&B copper prices are even stronger today at approximately $6 per pound. B1 cash cost of $2.31 per pound decreased by $0.11 from last quarter, marking the fourth quarter in a row our team has delivered lower cash costs. Solid production and cost control allowed us to realize strong gross margins of $3.05 per pound, or 57% in Q4, which represents an 11% increase over Q3. As commodity prices reached all-time highs to close out 2025, we remained focused on protecting margins through cost control across the business. Record-adjusted EBITDA in Q4 of $308 million increased 79% year-over-year. The sales like as noted previously would have increased EBITDA to approximately $332 million. This is the fifth quarter in a row we generate a record EBITDA as we continue to realize benefits over recently ramped up mines in Chile amidst a strengthening copper price environment. We reported strong operating cash flow of 287 million before working capital changes. Adjusted net income attributable to shareholders more than doubled year over year to 75 million or 10 cents per share in Q4 2025. A record Q4 marks the end of a strong 2025 driven by increased production, lower cash costs, and strong commodity prices. Moving on to slide 10. On the bottom left-hand side, we summarize our available liquidity, which has doubled year over year to greater than $1 billion at year end, including $304 million of cash and $711 million of undergone amounts in our corporate revolving credit facilities. We finished the quarter with consolidated net debt of $780 million, absolute net debt increase in the quarter driven by a negative working capital adjustment of $109 million, tied primarily to timing of accounts receivable collections. We have continued to see our net leverage decline as we deleverage our balance sheet ahead of Sano Domingo, with a net debt to even of 0.8x at the end of 2025 compared to 1.5x at the end of 2024. The chart on the right-hand side of the page illustrates our EBITDA sensitivity at various copper prices based on 2026 expectations, as well as our near-term growth with Mantel Verde optimized at four rates. Increasing grades at Mantel's Blankos next year and the normalization of throughput at Mantel Verde and Pena Valley. The midpoint of our 2026 guidance represents EBITDA in the range of $1.2 to $1.7 billion at copper prices between 550 to 650 per pound. As we look into next year, we, 2027 and beyond, we expect to see a significant increase in EBITDA approaching 1.7 billion to 2.3 billion for close to 40% growth year. And this is also indicative of our free cash flow growth potential as mentioned in 2027 and beyond. This level of EBITDA generation will enable us to continue to generate cash to de-level our balance sheet, further enhancing our financial position as we prepare for the next phase of growth. Moving to slide 11. As we experience a period of robust commodity prices, we are focused on protecting margins to ensure that the benefits of higher prices flow through to the bottom line. Our operating costs for 2026 remain consistent with prior years with an expected 4% increase in absolute dollars reflecting modest inflationary impacts, largely related to labor and sulfuric acid. The increase in our C1 cash cost guidance compared to prior is more reflective of the denominator effect driven by lower copper grades as a result of mine sequence at Mentos Blancos and Pinal Valley. On a consolidated company-wide basis, year-to-date, we have seen much higher byproduct prices compared to our guidance assumptions, which should provide a tailwind for cost in 2026. At current swap prices, our C1 cash cross guidance would be reduced by $0.10 per pound. Now I'll hand it over to Jim for the operations review.

Thanks, Raman.

We are now on slide 13. We will start with our amounts of early operations. For Q4, total production yielded 23,819 tons of copper at a combined C1 cash cost of $2.32 per payable pound. In Q4, plant throughput averaged 23.4 thousand tons per day as the site conducted repairs to address the reliability of the mill motors, which resulted in approximately 16 days of downtime. The repairs to the motors included upgrading components, installing additional protections, enabled the sulfide plant to reach record average throughput of approximately 37,000 tons per day in December. Today, all five motors are on site, which includes four motors in operation and one rebuilt spare, have been upgraded with additional protections installed to prevent the breakdowns we experienced last year from reoccurring. We have also enhanced the electrical delivery system with additional condition monitoring and changing out cables. As an extra layer of contingency, we have also ordered a second spare motor scheduled to arrive later this year. Copper grades of 0.79% in Q4 continue to reconcile well with the mine plan and block model. Q4 recoveries averaged 83.7%. impacted by the downtime in the mill associated with the motor repairs. Copper production and cash costs are forecast to remain stable in 2026, as more consistent throughput from the sulfide mill is offset by periods of impacted production, including a 15-day maintenance period to complete the construction tie-ins for the Monteverde Optimized project. On slide 14, we have provided an update for Monteverde Optimized. Throughout Q1, we will plan to complete the final stage of procurement and comments civil works before executing key construction contracts for the concentrator, desalination plant, and the tailings facility in Q2 once the required equipment and supplies arrive on site. Our expectations for a capital cost of $176 million and timelines for the project remain unchanged. To reiterate, In Q3, we are planning to complete the project tie-ins for MVO before ramping up throughput during Q4, with the goal to exit 2026 at throughput levels of approximately 45,000 tons per day. We are eager to deliver near-term production growth at our flagship asset through MVO, which adds 20,000 tons per annum of copper production at a low capital intensity of around $9,000 per ton. Turning now to slide 15, Manzos Blancos finished strong in Q4 to close out a remarkable year. Total sulfide and cathode production yielded a record 16,861 tons of copper at C1 cash costs at $1.94 per payable pound. Through exceeded design levels in Q4, averaging 21.4 thousand tons per day, The significant reduction of variability in the milling processes in 2025 is a testament to the capabilities for our asset management framework, which we are working on integrating company-wide. For 2026, we have guided to 48 to 56,000 tons of copper production at combined C1 cash costs of $2.85 to $3.15 per payable pound. The expected production decrease compared to 2025 is primarily driven by a one-year period of lower copper grades, which are expecting to approximate 0.7% in 2026 due to mine sequencing, with higher grades of 0.85% expected to return in 2027. The higher C1 cash costs at Montes Blancos in 2026 also reflect the lower amount of capitalized stripping, As we continue to benefit from stabilizing throughputs in the sulfide mill, we are preparing for the next phase of growth at Montes Blancos, as we work towards releasing our phase two study by mid-year. Moving to the United States, we will now discuss Pinto Valley on slide 16. We produced 11,423 tons of copper at C1 cash cost of $3.53 per payable pound during Q4. which marked the strongest quarter of the year for Pinto Valley. Due to prolonged drought in central Arizona, which resulted in water constraints, we operated at two-thirds availability with only four of the six mills online for October before returning to full availability in November and December. Internally, we have dedicated significant time to build the strategy around improving reliability at Pinto Valley. There are two main components to this strategy. Our first priority is water. In the near term, this includes improving onsite water infrastructure, utilizing the pit bottom as additional water storage, and assigning dedicated positions to manage water-related initiatives. While in the longer term, we are evaluating potential agreements with other closed mines in the area. Our second priority is increasing operational capacity through our people strategy and asset management framework. including improving operations and maintenance management, integrated business and asset lifecycle planning, and our procurement processes. As part of this implementation, there is expected to be a 10-day maintenance shutdown, which includes replacement of the primary crusher mainframe. We now expect this shutdown to occur in Q3. The Pinta Valley mine development has already demonstrated a significant improvement, with a 37% increase in material mined year over year in 2025. Over 2026, we are focused on replicating this success across the remainder of the operation. As we focus on improving production and costs at Pinto Valley, in parallel, we remain committed to unlocking significant value through the evaluation of upside opportunities on our land package and within our broader district. Over the course of 2025 and into 2026, we have seen an increased focus from the U.S. administration on growing domestic copper production, which has provided further endorsement for the strategic position of Pinta Valley. Kosmin delivered another quarter of strong results in Q4, as showed on slide 17. The operation produced 6,170 tons of copper at a record low C1 cash cost of 98 cents per payable pound, benefiting from higher solar byproducts, which continue to represent a tailwind for 2026. Through this year, we will continue to conduct exploration to evaluate the potential for mine life extensions or improvement to the production profile. And with that, I'd like to pass it to Wendy for a safety and sustainability review.

Thanks, Jim. We are now on slide 18. where we will discuss our safety and sustainability highlights for 2025. In October, we published our 2024 sustainability report titled Concentrating on Performance, which details how we continue to build the capacity of our organization in pursuit of our business and sustainability goals. Key highlights from the report include the launch of an integrated health, safety, and environment management system, which lays the foundation of a cohesive organizational approach. We also began to develop capstone-wide standards for key areas of sustainability, setting minimum performance standards connected to our sustainable development strategy priorities. We continue to make progress on our sustainable development strategy during 2025. including advancing our climate risk assessment by developing a financial model to analyze various scenarios. Additionally, we were proud to receive the Coppermark Award in recognition of responsible mining practices at Pinto Valley during 2025, joining Manto Verde and Manto Blancos, both of which received the award in 2023. As a testament to our commitment to transparency and responsible production, our Cozumel site also began the Coppermark assurance process in 2025, meaning all of our sites are now participants. Last, but certainly not least, 2025 represented the first year of our health, safety, and environment program that we called CU Safe. During year one of this three-year initiative, we completed our first safety leadership module with site management and executed phase one of our mobile HSE database. We are already seeing evidence of its effectiveness. As a result of this program, we've achieved a year-over-year reduction in reportable injuries of approximately 30%.

I will now pass it back to Kashal. Thanks, Wendy.

Turning now to slide 20. Over the past few years, Capstone has navigated through a period of significant change as we built and ramped up mines. Following the execution of several key milestones, our portfolio of assets is now well positioned to support future growth. During 2026, we will remain focused on operational excellence to get the most out of our existing operations, while continuing to advance our pipeline of executable organic growth opportunities. At Santa Domingo, we have several remaining work streams ongoing prior to an FID, expected in the second half of this year. These include securing an optimal financing strategy and progressing detailed engineering to approximately 60%, as well as advancing upside opportunities and potential infrastructure opportunities. In terms of our financial position, we will continue to capitalize on strong commodity prices by deleveraging through internally generated cash flows and reducing our net debt leverage further prior to a sanctioning decision. In addition to advancing Santo Domingo, we've highlighted our other key priorities for execution over 2026 on slide 21. We will upgrade Mento Verde to sustain 45,000 tennies per day funded through internally generated cash flows. We will also look to release the Mentos Blancos Phase 2 study mid-year. Both these projects are great examples of the type of low capital intensity brownfield expansions we like to prioritize, especially beneficial during periods of strong commodity prices. On the exploration front, We will continue to build on our success from 2025 with an expanded exploration budget of 70 million for 2026. One of our main priorities is to progress phase two of the Mento Verde exploration program with a focus on improving grades, adding mineralization and testing high priority targets immediately north of the pit and along the 10 kilometer northern corridor. At Santa Domingo and the nearby Sierra Norte deposit, We will focus our exploration efforts on advancing upside opportunities for incremental copper production in the region, specifically those eligible for contingent consideration under our joint venture agreement. Our team is eager to unlock significant value through exploration in pursuit of our strategy of building a world-class long-life copper district in Chile's Tier 1 Atacama regions. At Capstone, we are proud to have created a peer-leading pipeline supported by an enhanced, diversified foundation of operating assets. As we enter into a new year, our strategy has not changed. We will continue to focus on operational execution, strengthening our balance sheet, and responsibly advancing our projects to ensure we are well positioned to execute our goals. The fourth quarter marked the completion of an inflection year for Capstone. We achieved our guidance and delivered record results across a number of metrics, allowing us to realize the benefit of strong commodity prices. We also took tangible steps on our path toward transformative growth through execution of several key catalysts. We are well positioned to become a leading, long-life, low-cost copper producer, playing an important role in providing the copper the world needs now, and into the future. With that, we are now ready to take questions.

Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by the number one on your touchstone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by the number two. If you're using a speakerphone, please lift the handset before pressing any keys. Their first question comes from the line of Ores Waukadao from Scotiabank. Your line is now open.

Hi, good afternoon. Obviously, this year, based on your guidance, is more of a transition year. When I look at your slide eight, and you've got a target there of approximately 265,000 tons of copper, and you've labeled it near-term growth, is there any reason for us not to think that 2027 could be something in that range? When I look at what's assumed in that 265, just based on the fine print, it feels like all those pieces are in place for 2027. Just wondering if I'm missing something or if that's being too optimistic.

Yeah, thanks for the question, Oris. I would think that is the closest characteristic of what we expect to produce in 2027. As you know, we've sort of been giving one-year guidance year over year. You're absolutely right to identify that all those pieces are in place. Obviously, you know, there's some optimization and execution that's not dependent to deliver on that 265. But the range is sort of where we're sort of thinking about the probability and we're not ready to provide the range yet. We're maturing all our long-term plans now as we speak, such that, you know, we can provide maybe that accuracy, you know, again with guidance next year. But we would be disappointed if we weren't able to achieve that next year. Okay.

That's great. And just as a follow-up, I'm just curious what you assume as a normalized throughput rate for Pinto Valley is. for the next couple of years?

Yeah, that's a great question. I'll just sort of lead in and preface it by, you know, the process improvement we employed at Mentos Blancos and the asset management framework and the team that facilitated that there with consultants and internal expertise, as well as the management team, is what our deployment is at Pinto Valley. We've now been on that journey sort of for a year at Pinto Valley. Obviously, we had the overprint of the drought last year, which was, you know, unlucky. But we've sort of drought-proofed ourselves going forward for the next two years, and we'll seek sort of long-term solutions thereof that we believe are perfectly executable. But the way I look at it is the instantaneous throughput of Pinto Valley is 62,000 tons a day. And best in class of an asset of that vintage would suggest 90% utilization, accounting for unplanned and planned maintenance periods. So that would mean 56,000 tons a day. So we see ourselves from the beginning of this year, where we sort of have built into what we call our prudent and reliable guidance, from a 50,000 working our way through the year up to sort of 52,000 tons a day, and then next year incrementally taking that up again. As we make these improvements in our maintenance program, switching it from a reactive process to a proactive process, we see ourselves marching in the next couple of years towards 56,000 tons a day on a reliable, prudent, continuous basis.

Appreciate the color. Thank you, Cashel.

Your next question comes from the line of Dalton Barreto from Canaccord Genuity. Your line is now open.

Great. Thanks, Operator. Good afternoon, everyone. Cash, maybe I can start by asking what meant the Manitoburney Mill average in February? You passed the strike. You passed a lot of the stuff last year. Thanks.

Yeah. Yeah. Thanks, Dalton. So, you know, always bringing up a plant from an unplanned interruption. always has its challenges, but the team there has done a terrific job. Um, it's sort of hit nameplate, you know, that 32,000 tons a day and just right around 85% recovery. So, uh, we're really looking forward to getting back to what we achieved in December, which was, you know, through continuous production after, uh, you know, working through some of the items that Jim outlined with respect to the motor, um, you know, where we achieved a 36,400 tons a day in December. And, uh, So we're looking towards getting back to that and building, you know, against that prudent and reliable guidance that we put out that is in and around that 32,000 tons a day. So that's what we achieved.

That's great. Thanks for that, Kashil. And then just maybe building on what Boris was asking around 2027. For 2026, you put out your guidance, you know, your stock is down in the back of that. for your longer term, it's down to 375 versus 400. I'm just wondering if you could sort of contextualize all of that for us a little bit more and maybe, you know, hit on some of the key assumptions for 2026 in terms of what you're assuming for a ramp up at NBDPO, Pinto Valley, that sort of thing. Thank you. Yeah, yeah, great question.

And yeah, and thanks for noting those differences. When we speak about guidance, what is most frustrating is when repeatedly companies don't meet guidance. And so there are ways to build your plans, and they can be – we use – there are terms we use, prudence, stretch, and breakthrough. And when you repeatedly put out stretch and breakthrough, while ambitions and processes are there, You really can only build on what you're capable of doing and what you've done. We believe what we've put out for guidance is a prudent forecast of what we can achieve with a certain amount of bumps in the road. And we have left ourselves for upside. And that upside, as you sort of indicated, is significant. we're not assuming we're instantaneously going to achieve after the August shutdown and tie-in of MBO, which is a 15-day shutdown, the 45,000 ton a day throughput. We believe that's going to take a certain increment to ramp up. Recognizing that that comes near the end of the year and, you know, having been in the mining industry for 30 years, when you have high-grade or ramp-ups at the end of the year and you have a month delay, it can really impact your guidance and thereof. So, we took what we call the conservative approach and didn't book that. We sort of booked a lower ramp-up through that last quarter. It still gives us four months to ramp up essentially what are pumps and pipes to what we're already achieving some days over 45,000 tons a day through our pressure and grinding circuit. So we have high confidence we'll be able to exceed the expectations at Mento Verde and start out 2027 well. at that 45 000 tons a day there and really that production is a major increment to that increase of what orist had previously pointed out the 265 000 tons which is indicative of what we believe our guidance will be in 2027. uh that combined with a little more throughput at pinto valley back through the sequence in higher grades at Mantos Blancos and less down days through the year of 2027 because we won't have the MBO tie-in or some of the major equipment downtime we're having at Pinto Valley. So all those things conspire to sort of that run rate of that 265. And just for the last part of your question, you mentioned sort of discrepancy with respect to the 400,000 tons of copper that at the completion and ramp-up run rate at Santa Domingo when we build upon all our other assets. Part of it is just the maturity of these mine planning processes and that characterization I get of being prudent and reliable. So part of it is the mine planning. But what I would say is we have a number of operational excellence and improvement projects where we believe Over time, we'll be able to build that back over 400,000 tons. By that time, we achieve full production at Santa Domingo, principally for Mentos Blancos. We have two programs there, one that could add 15,000 tons of copper and concentrate with Mentos Blancos to 7,000 tons a day by bringing on two existing mills. And then we have the opportunity of 20,000 to 25,000 tons of cathode at our heat bleach plant, opportunities with respect to the old Ripio Suspentor and some of the coarse fraction of the higher grade residual from the 1980s and 1990s in the order of 140 million tons available to us at 0.3 copper. So those are just two examples, not to mention some of the other byproduct credits we see coming. Later this year, we hope to put out a feasibility study around some of our cobalt production, for example. All those will be contributory that we'll get back over that $400,000. We've sort of characterized that $375,000 as executable, prudent, and permitted. And so we have more growth beyond that by the time we get to Santa Domingo.

Thanks for that, Cash. I'll jump back in here.

Your next question comes from the line of Daniel Morgan from Barry and Joey. Your line is now open.

Hi, Kashil. My question regards Pinto Valley and just drought-proofing initiatives. Can you just expand on the actions taken there? It sounds like there's water retention you're doing at the bottom of the pit. Just wondering, is that going to continue into 2027 at all and have any impact on the early part of 2027? Thank you.

Yeah, thanks, Daniel. Yes, so we call it our northwest wall. We're doing a push back there. The highest grade at Pinto Valley is in the bottom of the pit. So we're in a sequence where we're pushing back the pit. We get the opportunity now to store that water rather than in an old tailings facility where we typically have stored the water. So we'll get an opportunity to drain that tailings facility, take a look at it, understand for future value. And the sequence of the mine is such that we'll be able to use that for fully two drought seasons, the drought season in 2026, the drought season in 2027. And we've already almost stored the total amount required that would have mitigated the drought last year in the bottom of the pit currently. So we're well set up, and then we will address the issues of water management beyond 2027 over these next two years while we utilize that opportunity of the pit to be able to store the necessary water we need.

Thank you. And then can you just remind us again, the Mantos Blancos expansion that you're studying and planning to put out on mid-this year, I'm not looking for numbers, but just can you remind us conceptually about what needs to be done to achieve your goals? Like what can you leverage and what needs to be installed or improved?

Yeah, thanks. So the major bottleneck is actually we will have exhausted our course tailing – sorry, our fines tailings capacity three years from now. And so, as it is currently with the administrative process of receiving permits in Chile, you can work on one site at a time. We have three things we have ambition to permit at Mantos Blancos. One is bringing on two mills that we currently use When we go into a reline on our mill number eight, mill number eight is the new mill that was added in 2021 and 2022. When we go into that reline, we actually do compensate for our production by turning on these other two mills. The only reason we can't use them now really is because of permitting constraints on throughput and some downstream capacity issues that we need to build in. That's what we call Mentos Blancos II, and that would add that additional 15,000 tons of copper per year to concentrate. So that program, you know, would probably – we could probably execute that in less than a year, provided we had the permits. But the permit is for this fines, tailings, impoundment. The current impoundment site is a combination dam and open pit. Our next site is an open pit we're currently mining. An open pit is called Phase 22. That'll be ready a couple of years from now for more tailings. But the way the Chilean administrative process is, is that it takes two years for a full EIA for a tailings dam. Now, we don't know if this is going to be the case, but the CAS administration has indicated they might, in the future, accelerate administrative processes We think this could be a candidate for that because this isn't an impoundment structure. We're filling a hole. But conservatively, we're saying we'll have the permit submitted near the end of this year. It'll take two full years to go through an EIA, and then we'll get the opportunity for this new vines tailing impoundment site, as well as Mantis Blancos II with the two mills. There's that other separate project I was talking about where we can utilize some of the installed capacity in our SXEW plant where we could see upwards of 20,000 to 25,000 tons of cathode being produced by leaching some of the ripios and coarse tailings that have some high residual oxide and secondary sulfide grades. That project we're still working with. Probably the guidance for that project will be more to the end of the year than the middle of the year. But we're still figuring out what we can do if there's a possibility maybe to bring some of that copper forward outside of that permitting constraint. But that'll be for another quarter.

Thank you so much, Kajal.

Your next question comes from the line of Craig Hutchison from PD Cowan. Your line is now open.

Hi, guys. I was wondering if you could just provide some more color on the grade guidance for Mentos Blankos this year. The 0.7%, it's pretty, it's really lower than the tech report. When I look back, I think you're supposed to be a little bit above 0.9% this year. Is that a function of negative grade reconciliation? Are you smoothing out your technical report just any context around that would be helpful. Thanks.

Yeah, it was good observations, Craig. You know, the reconciliation isn't in question, it works, it works well. The tech report sort of evaluated, I would say more of it was well, it was published in 2021. And it was part of the the merger of the two companies. We will be replacing that tech report later this year with a new tech report with more resolution on the mine planning. I would say that one was sort of flatlined, more or less, out in the future years with less detail in the present years. And the present years they were looking at were more the years of 22, 23, and 24. Well, now we're out in 25, 26, and 27. and it doesn't have the resolution required. The sequencing we have, we're just into a low-grade portion. It has no concerns or considerations for any reconciliation. All our reconciliation is working out within normal tolerances. So we will be back into plus 0.85% copper in 27, 28, and 29.

Okay, great. And then maybe just a similar question for the Valley, just for the upper benches. Should we assume grades in 27 are quite similar to 2026?

Yeah, yeah, exactly. Probably in the order of 0.29. We're pushing back that northwest wall, and there is some variability in there. There is some opportunity for dilution, but that will be all to the upside of the guidance we have.

Okay, thanks, guys. Yeah. The next question comes from the line of Lyndon Fagan from JP Morgan. The line is now open. Thanks for that.

And good morning, good afternoon. Look, I was hoping to just continue on the grade theme. Obviously, the guidance was pretty poorly received by the market for 2026. If we look into 2027, You've talked a bit about the Mandaverde grade, but what about the other assets? Are you able to give us a flavor for grades across the portfolio in 27 just to avoid that kind of sticker shock?

Yeah, so I just sort of was talking about, Lyndon, I was talking about Mentos Blancos just to clear the deck here. That was, I think, the grade shock was the decrease to 0.7 from this year at 0.9 or 0.92. And then so the next three years, like I said, what we were anticipating is to be above 0.85 for 26, 27, and 28. So that's Mentos Blancos. Pinto Valley will be at 0.29 for 26 and 27. And then the following year during some time during the year, I can't say exactly just off the top of my head what quarter yet, but we'll be back into the bottom of the pit and the pit, the grade will start trending higher to the 0.32 to 0.33, maybe even 0.34. So that'll be Pinto Valley sort of recovering. And Mente Verde, you know, we're in 0.72 now and we're, And we see ourselves in the next year, in 27, sort of getting upwards of 0.9, 0.73, sorry. So we're going to be pretty level going forward with the 0.7 to 0.73. And Cozumel... There's slight decrease in grades going forward right out to what we have as current end of mine life. You know, last year we produced 25,000 tons of copper and I believe 2031 is sort of scheduled for 18,000 tons of copper and it's kind of more or less a decline from here to there.

Thanks.

Just to clarify, Mandaverde, do you mind just running through the the 27 and 28 outlook. And also, while we're at it, talking a bit about the oxide, it looks like the grades have fallen there. I don't know if it's temporary in 26, but maybe a bit of flavour of what's going on there as well.

Yeah, yeah, yeah. Well, yeah, good identification. Yeah, so we're in a two-year sort of lower cycle on the grades at Manta Verde, and then we'll start coming up again on the oxides, yeah.

And, sorry, the sulfide, what did you say again for 27 and 8?

0.72, 0.73. So the same grade.

Thanks. Okay, great. And then I guess the other part of guidance, which is pretty hard to get a handle on going forward, is capitalized stripping. Are we trending around the 26 number for the next few years or going up or down? It would be good to get some flavor there, please.

Yeah, yeah. And again, you know, as we said, we're endeavoring to update a couple of our technical reports, certainly Mentos Blancos this year, and we hope maybe early next year, Pinto Valley, because those are sort of the consumers of the larger strip and some of the capitalized stripping. We do have some sustainability and ambitions to meet certain standards and guidelines on some of the old infrastructure and tailings, empowerment at both Mentos Blancos and Pinto Valley. So that'll go this year and next year. Then we sort of see ourselves if you take off that – so that run rate of capitalized stripping plus is in and around with sustaining capex $600 million if you take off the expansion capital. So we see that for two years, and then we see ourselves sort of maybe dropping to more like 500, maybe 400 to 500. after the next two years for those four apps.

Thanks, Cashew. Yeah, that's really helpful. Thanks very much. I'll pass it on.

Your next question comes from the line of Marcio Farid from Goldman Sachs. Your line is now open.

Thank you. Hi, everyone. Quick one maybe on Santo Domingo. Obviously, we've reached our financial targets in the new one. We've essentially got the JV pattern already. I think that, you know, there's a couple of things that are missing. Obviously, the project finance facility hasn't been detailed yet. But also, I think there is, you know, if you can provide some update in terms of where we are at in terms of the project finance discussions, but also any update on the, you know, on the development of Center of the Lingus profile would be great as well. Just trying to understand if there's a, you know, 2026 sanction, is it still a viable option? Thank you.

Yeah, just maybe I'll just put in a few words and I'll pass it to Raman for exactly what our options are with respect to financing. But our goal is to be in a position in Q4 for sanctioning. And, you know, obviously there's the macro environment. There are a lot of things external that might affect what that is. But our goal is to take what is in our control and be ready then. And so one is detailed engineering to 60%. Another is to determine what is within the scope of capital financing and what is out. As Many of you know there is a modular nature to some of the off-site infrastructure required for Santo Domingo, like a desalination plant and a port. And there's everything from working with a current owner of a desalination and a port and a commercial arrangement to joint ownership to boot contract of infrastructure of our own assets to capitalizing our own assets. And it seems complicated. It's not that it's complicated, I suppose. It's just what is the best strategic outcome and the best value outcome. So, we're working through those. We sort of set ourselves a goal to resolve that in the second quarter this year, such that we can then determine with that 60% detailed engineering, what a robust capital number is, and what required financing we have. So with that, I'll just pass it over to Ram and to talk about some of the ideas we have with respect to financing. And I'd just add, obviously, you know, we did do the partnership agreement for the 25%.

Thanks, Kasho. Yeah, like Kasho mentioned, we've got the Ryan Partnership, which brings in, obviously, $300 million in de-risk. kind of the financing plan when you look forward um and we're trading off a couple alternatives we got the base case of like traditional project financing which could be done at the asset level that we've kind of kicked off already and that takes time but it'll be in place for q4 timing because you got to start that um but you know the other alternatives we're also assessing in parallel are a potential mix of you know like a high yield and a bank debt piece um that can be put in place as well to fully finance a project. As you know, the bank markets are open from a lending perspective in these robust copper price environments. So I think we're just trading off the cost of capital as a couple of alternatives and the restrictions and whatnot that come with it, assessing that and discussing that with our board.

Thank you. Thank you. Thank you.

Your next question comes from the line of Adam Baker from Macquarie. Your line is now open.

Hi, casual team. Thanks for getting to the question. Just on the cathode production at Monteverde, looking back at the tech report, I think you had it rising to around 39,000 tons in BY26. I know you noted on the call, you know, lower grades driving lower cathode production, but do we have confidence we can get, you know, back up to the 39, 40 kT levels for cathode, noting, you know, the drop in this year's guidance? Thank you.

Yeah, I don't know if I caught the second part of your question, but let me get to the first one first, and you can repeat yourself maybe after. The first part is, if you recall, we're, you know, versus the tech report, we're a little late on MVO versus our ambition, and part of it was 5,000 tons of enhancement due to bioleaching and due to enhancements in our SXEW and leaching processes. So that is one of the boosts we'll see is actually a gain in recovery that will happen in 27 versus 26. So I hope that sort of fills that gap for you. And did you have another part to your question?

Just to see if we could get back to 39 KT of cathode production from Monteverde once MBO is fully ramped up. Is there anything to suggest that you can't get to those levels?

Yeah, and that is one of the key contributors there, combined with some grade lift two years from now. So between the two of them, we'll get back closer to that 40,000 tonnes of copper.

Thank you. And maybe just one for Raman on the taxation expenses, a bit of an uplift in the 4Q. You know, a lot of that's obviously driven from higher profitability with higher copper prices. Can you just remind us of the income tax expense rates moving forward from here?

On the income tax rate, roughly kind of like it depends by jurisdiction. PV is like 21%. Mexico is like 30% you can use. And then, you know, Chile is 30% to 35%. And just, you know, Chile has got that adverse alarm tied to copper prices a bit. That kind of came up. So slightly higher taxes perhaps in Q4 tied to a higher copper price.

Thanks, Justin. Our last question comes from the line of David Radcliffe from Global Mining Research.

Your line is now open.

Hi, good morning, good evening, Cashel and team. So I had a quick question on Pinto Valley slide and the comment there in regards to district consolidation opportunities, because that particular comment has been, I guess, flagged in the DAC for many years, and today we've seen a peer growing their U.S. business through M&A in the States. Maybe if you could comment to the extent you can on the potential for this search, the events in 26, so any color you can provide and maybe what you see as the current roadblocks.

Yeah, we continue to work with our neighbors and specifically with the exploration slash amalgamation idea with BHP and Copper Cities. That has been ongoing, as you've correctly identified, for a couple of years. We are seeing, as you would see with either our peers or other letters of intent out there with BHP, that there is a renewed focus in the American Southwest to help generate more copper production. Obviously, we're well positioned having an operating asset for growth and incremental growth by bringing these things through rather than greenfield builds that are either questionably permitted or not permitted yet. So with respect to Copper Cities, we're evaluating the possible inclusion of other, I would call, satellite opportunities to see if they can enhance the prospects thereof. So all I can say is we really hope to be able to bring more light and more color to our plans later this year and that we're seeing more energy and more focus from our potential partners.

Okay. Brilliant. Thank you.

I'll pause it on.

That's the end of our Q&A session. I will now turn it over to Cashel Barr. Please continue, sir.

Thank you, Operator. We look forward to updating you in April with our Q1 results. Until then, stay safe and feel free to reach out to Daniel, Michael, or Claire if you have any further questions. Thank you for your continued support and have a good day or evening.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.