Atalaya Mining Copper (LSE:ATYM) — Q3 Results

0:01 Good morning, ladies and gentlemen, and welcome to the ATALAYA Mining PLC Q3 Results Investor Presentation. Throughout this presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time via the Q and A tab situated in the right hand corner of your screen. Simply click q and a, scroll to the bottom, type your question, and press send. Company may not be in a position to answer every question received during the meeting itself. However, we'll review all questions submitted today and publish responses where it's appropriate to do so. These will be available via your investment company dashboard, and you'll be notified once they're ready for your review. I'd also like

0:32 to remind you this presentation is being recorded. Before we begin, I'd like to submit the following poll. I'd now like to hand you over to Cesar Sanchez, CFO, and Alberto Lavendera, CEO of ATALAYA MINING COPY. Good morning. Hi. Good morning. Thank you very much. Ladies and gentlemen, thank you for being here and taking your time. We'll be running through the results that we had in the third quarter, which have been very good. I have with me the CFO, of the company, and we will be following the presentation that we found in our, in our web page. Going directly into into the subject of of the meeting, in general, I would be kind of running through the presentation and through the past results, but at the same time, to give a a little bit of background where it's needed because, we we assume that there may be some, investors that are right now potential investors that right now are not shareholders.

1:38 So please, those of you that know the company very well and have followed us for for for a long time, excuse me, if we kind of repeat some of the things that are obvious. If if I started with with page five of our presentation where we reviewed it, what was the q '3 look. In two words, and everybody can read it, but it went very well. The mill continued to to the mill expansion continued to work as a as full capacity, more on the the nameplate. We are going to be in the range of the 54, 56,000 tons of copper in the year, which is higher than the guidance and very likely in the high end. Due to the good productivity, the our all in costs are going to be low. And, of course, due to the good copper prices and and good operational performance, not only we are doing well, but we were going to be doing well, we believe. Enough and, of course, the balance sheet is improving significantly.

2:40 You will see that right now, at the end of the quarter, we had €90,000,000. We are now in mid November. You can imagine that the situation has continued to improve. So at the end, this delivery, we said in the last presentation that there was no intention to sit in the cash, and we have delivered again and again. We have, approved the company has approved a 30 to 50% free cash flow starting, in 2022, but, actually, we had already a good year. And we started with with our first maiden dividend of almost 30¢ per pound share, which is, I think, is a fantastic yield of over 7% and, and still the cash flow building up. In addition to that, we said, look. This is not a dividend company. This is a growth company, and we are starting to to announce results of the the the drilling at Massa Val Verde. It's a satellite deposit around '25 kilometer from Rio Tinto and at Majadales, which is one of our discoveries.

3:47 We'll continue to do that. Well, as a result of all this, good news, people are starting to know us. Liquidity has been improving quite a lot. So I think we have been trading average of half a million shares in the last few months, which is a excellent outcome if you remember when we only had less than 20% float. We have lots of institutions in our shareholder as shareholders now. All this is important, but for us, and safety of our employees and NESG initiatives are essential like it should be. We continue to work well with the COVID situation. In Spain, as you know, things are well in our company, has not really affected us. And we continue to we work in a in a mind that's sitting besides populated areas. So for us, dust control water is essential.

4:41 No absolutely zero discharge to the environment in water, trying to to reduce the historic footprint, and historic, problems here. And now, finally, starting to build a solar plant at Rio Tinto, to utilize our land and the fantastic sunshine that we we enjoy here. What's the future? The future is we continue to prepare the forty three one zero one reports in in our satellite deposits of Cerro Corral, San Antonio, also as our satellites I mentioned before. And those are complex copper and zinc. And one of the ways we believe we can get a better outcome of those deposits is to to produce metal direct. This is our ELEX system.

5:32 For those of you that don't know it, it's something totally new in the world, which will produce, metal directly. But most important, it gets a very high recovery of of these complex ores. We do have another project in in Galicia. It's called Toro. We continue with the permitting process. We are very careful. We are doing things the right way with a lots of communication and stating the facts. We know that the people I don't think they're against us. I think people are are not well informed, but we simply deliver. Deliver show what we are doing right and what we can do. And we will talk a little bit, about that also. If I go if I may go to to page six and going directly to the results, I mean, strong copper production. You will see in the in the in the graph how copper production has been going up steadily in the last years.

6:26 Recovery recover, picking up from the small downs that we had when we connected the two expansions. For those of you that do not know the company, this this project has been built in a very short period of time with, half of the CapEx that was expected, and, has been delivering since 2015 after being over almost seventeen years stopped. It has been built in three phases. And right now, we have already been operating during the last 0.75 with expanded well over the nameplate capacity. And, of course, these results in a steady copper production, in the range of 50 to 55,000 tons on a normalized basis in a moment where the copper prices, we are enjoying very good copper prices.

7:16 As a result of all that, you will see in slide seven that, of course, our revenues have gone up to basically almost €100,000,000 per per quarter. So we are talking about analyzed 400,000,000, euros per per quarter, which is a good sales. Importantly, is the EBITDA. Now you can see our efforts of building this expansion that are becoming evident, and we have generated significant EBITDA in this last three three three quarters, which basically take us to to analyze a number of around 200,000,000, EBITDA, which is is a fantastic result. But the most important thing and most spectacular is the is the cash flow generation. I mean, I know people were it's a question in the question in the past about if this company was going to generate cash. Well, it's becoming evident than since in the lower part of that graph. If you see what was our negative working capital position when we basically build the plant, build installations with using our own working capital and minimal dilution from the shareholders.

8:23 Remember that back in 2019, we only raised less than half of the shares that we needed. We since then, we have been delivering. We constructed the installation. And since then, even with lower copper prices, nice excess cash flows. As we sit right now, we sit in a fantastic cash position, which can be seen in the next slide eight. So right now, our our cash in this at the end of this quarter was almost €145,000,000. Since we have some debt of 52, which was used to pay the historic liability of Astor, which we also got got rid of, we are sitting almost €90,000,000.

9:08 We were sitting in €90,000,000 in the last quarter, one month one month and a half ago. But as you can see, the working capital surplus, that was 17, last year, and now 126 is means that we have improved the work balance sheet in the last, last nine months by €100,000,000, which is a very significant outcome. And that's including, the fact that we use a contractor. So we the contractor has always be a higher cost of capital due to them replacing the equipment, but also the fact that we continue doing some investments in, in tailings thickening, as you can see in the lower part of the the picture, in some optimizations of the plant that has given us, better recoveries in expanded tailings, facility for the future, and so on. So even so, we have been able to generate this, this excess cash.

10:08 Well and this has resulted in the in, announcing the dividend, in the October 27. Most of you that our shareholders will have seen, the results. And and it's a first, dividend, so it has has some hiccups and some issues of of the distribution list and so on, but, we are overcoming all that. The time of payment is arriving, and is is and his team is doing a fantastic job to get all this thing done. And, hopefully, in in in less than fifteen days, you you will be receiving those of you who are shareholders the the money in the bank. Somebody asked me, will this will this be the last one? Well, we don't know. We have said that we will issue between 3050% of the free cash flow generated to to our shareholders, leaving some room for for expansion, for future, for growth.

11:09 Well, things are going well. We if the prices of copper continue to be good, maybe the board could can decide to top up a little bit. But as I say, we always deliver in our in our promises. So, certainly, we are not going to we have been very disciplined with the CapEx in the past with the cash. This thing is not going to change. So the cash is not going to be sitting on our balance sheet forever. So, yes, we are a dividend player now, for a surprise of many, but this is not about dividends. This is about growth. We have a vision. The first, get into production, expand, what's beyond that? Well, we have a very good land position, which is shown in in colors, in the in the screen.

12:06 It's a quite significant land package where we have a centralized, mill, and we are doing some exploration in the East. It's shown in green and in orange. And Southwest, we have another area called, Valverde, 29 kilometers joined by a public road where we are doing significant exploration. In blue, you will see the the landholdings of Matsa recently acquired by Sunfire. And I may compare with what are their sources based on public information of what they have and what we have So we can start people can start seeing that, actually, with the there are copper resources that we have in at at Federal Colorado, our current mine, the one that's producing cash flow, are only the tip of the iceberg, and we are going to be growing.

12:57 So if I may expand a little bit, what do we have for those of you of you that do not know the company? It's a it's a it's an open pit, shown in red, between around 2.4 kilometers long. And east and west, which is right and left in the picture, we have two deposits which are historic, are well known. One is then is called San Antonio as underground. Good grades, good combined grades with lots of lead sink also. And at the left side, Dionysio, which where we have ambition several scenarios of open pit underground, it's a combination. There is already an open pit. We are thinking of expanding that and mine the remnant underground. It will all depends on the economics. Also contains copper. Copper and zinc. So those will be treated in the same plant that we have. Here's a picture where you can see the location of our installations in our plant, which is a 15,000,000 tons per year nameplate.

13:53 But the reality, it's it's 16,000,016 tons. At the left lower part is the Cortatalla Pit, which the we will plan to expand. And in the right bottom right is our existing pit, which we where we have a a mine life of of of of over ten years. But this is a very prolific belt. The the in in slide 14, you will see our our mineral rights with existing mines. You will see that there are several existing mines already. Las Cruces of First Quantum, the three mines of Maza, Sunfire now, and further to the west, we'll have, two older mines, Almina and and Neves Corvo in Portugal. It's a very prolific belt. Because it's a very prolific belt, the first thing we did is is we got two years ago in Massa Valverde, And where where where it was drilled, we had an option where typically of us, we just work, and we didn't announce anything until we got it. But we did discover deposits called Mahadales, which is shown in the in the right side of the picture. There, we have put a few holes, and the last one we have announced has significant copper, values with zinc and lead and silver.

15:07 About one and a half kilometers to to the west is the main MASA Valverde deposit where we have two rigs right now because the distance of those hole between those holes is very wide. So it's it's quite open, and it it's a significant deposit. We are preparing the 43 101, but at the same time, we're starting to release the fantastic outcomes of this deposit. It contains some sink areas, but it also contains some copper only areas. The copper only areas could be sent by road, directly through a ramp to our installations at Rio Tinto. So we wouldn't need a specific any, specific plant there. And that's exactly what Matza does, trucking ore from the Sotil Mine, which is just five kilometers north of this one, trucks it to the to the to the mine north at Aguas Teridas at Matza.

16:06 If you look in in a flat view, this is a kind of imagine this is a kind of long deposit of a one kilometer long, very thick, about 200 meters. It can be seen that it was it sits between 400 meters to 600 meters to 700 meters of depth. It's opening all those directions that are shown in arrows. It's a significant size deposit, and, and it shows that the area has a lot of potential. In pink, or kind of purple, the the the sink areas, in copper, the the copper areas. You can see that there are some copper only areas that are not polymetallic. We are very excited about that. And what's what can be the effect of of this?

16:52 Well, we somebody asked us what what would the effect be if you could bring a little bit of of of this copper into the your installation? Can you produce more from Rio Tinto? Well, yes, we can. Of course, depends on what you bring in. You can bring some areas from, let's say, point 7% San Dionisio, which if you only added, let's say, 1,000,000 tons, you would add 3,000 tons more of copper to our current production. If you added 4,000,000 tons, you would you would add 11,000 tons of copper. Of course, you can also bring some underground, like, at a 2%, from MASA. And if you added, let's say, 1,000,000 tons, which which is a very small amount, that will bring 14,000 tons of copper additional. So we do have a a good potential of growth just in our satellites without making any significant, amount of of, expansions at our site.

17:47 That with total, on a 100% basis will get us basically close to 100,000 tons of copper produced, in a stable country like like, like Spain. So that's more or less our growth. And and people ask us, I mean, oh, we didn't know there was copper in Spain. Well, there is lots of copper in Spain. It used to be story. That's where Rio Tinto mining started. And Maza, the the deal of Matsa that has been bought by Sunfire for 1,900,000,000, I think has helped, to put the real the the the pirate belt in context in in in the map. Matsa has you will see that table in slide 18, a plant of 4,700,000 tons per year, fantastic plant, and we have a 15,000,000 tons, basically 16,000,000.

18:36 They have an enterprise value of 1,800,000 based on on the purchase price, and we have a 650,000,000. But when you start looking at production and figures and copper reserves and resources and all this is based on the public disclosure of the transaction by Sunfire, you realize that, actually, we have probably higher resource life. We have a higher reserves, and we have higher copper equivalent resources. So it doesn't mean they are wrong. What it means is probably we are wrong, which is probably low. In addition to that, of course, we're trading at less than three times enterprise value EBITDA versus a transaction of for almost five times.

19:24 And and also the the the the much lower enterprise value per per ton of reserves and resources. That means, basically, how do you value your company compared to the to the metal that you have in your inventory? So we are probably trading between 160 to 250% less than what they had. Of course, the Matza deal is a fantastic deal. Good good grades, but also shows you that the potential of growth of our company is totally not known in the market and is not well understood. So I want to emphasize that that, basically, we are a growth company, not only a dividend. Let me talk a little bit about ESG. I mean, for us, this is essential. It's all about people. We have a fantastic team that has been able to do all this, in this last few years.

20:18 For us, governance is important. We have a board that is independent. Even we only have two share two persons representing the shareholders, but we have independent, board members, charters, and so on. We are a company that's is not shown there, but cert certified ISO 9,000 in quality, 14,000 in safety sorry, in environmental 18,000 in environmental safety. We have also signed the the protocol of the United Nations. We're the one of the few companies of the of the mining world that has signed up. And that means, at year end, and really, being consistent and transparent with all our

21:04 our initiatives. All these initiatives are going to be, are going to be, recorded in a on a ESG report that's been prepared, and it will be published soon, certainly before the end of the year, before the end of the year. The and, of course, since then, we are going to continue every year. For us, the pillars are environmental and climate change. Try to reduce our carbon footprint.

21:38 Essential on that is the LX system. Essential on on that is the the recycling of water, tailings thickening, zero discharge, and so on. Keeping society, keeping we we have to be good neighbor. The place where we operate in is Rio Tinto. We are surrounded by seven communities. Some of them villages only sitting few 100 meters from the pit. And, although we are probably not very well known in the total project, by by some, let's say, communities, the reality is that we are very welcome and good neighbors at, at at Rio Tinto.

22:26 We have most of the suppliers are local. All of our employees are local with good jobs long term with training of local people, the local workforce. We are a company that's 100% Spanish, operators and employees. A few few from outside of which are historic and Spanish residents for some time, but something that we believe that we have to be good neighbors for the long term. In addition to that, we believe in the the research and development. We believe in the future, and that's why we have been working with this ELEX system, which impo sponsoring some some people, some person that has discovered something that would something that can change the world, to produce directly metal.

23:15 And we have been working with this already for five years, and we believe this is going to be something announced very soon. Besides that, the the it's incredible the amount of technology you one one mine has. If you're not familiar with mines, it's it's not really it's not really a quarry by itself. It's just an excavation. It's it's controlling where each truck goes, where each machine goes. There's over 800 motors working at any time with 1,500 control points and and around 20,000 sign signals at every given moment, all controlled from control rooms, almost and more actually that you would find in a in a in a in a passenger plane.

24:04 That's the type of complexity. That's where sometimes we feel a little bit a little bit how can I say that we are not transmitting death because when people doubt that we are going to be doing things right in, for example, in a total project, not being able to control tailings or control,

24:25 control our discharge, the river? Well, if we are doing it right now, if we are using satellite controls to control any movement, including day and night, I mean, being in the in the first class, why wouldn't we do it in these new projects? So, eventually, it's a it's a problem of of transmission. It's a problem of education. We will we will get there.

24:49 So those are the, the pillars that we have in ESG. So, in conclusion, I used to say that we don't want to give surprises. I mean, if I'm very proud of the team that they they they tell us the wrong things soon so we can correct them. We have always been guiding what we are going to be doing. First, a few years ago was to reduce the capital costs, increase the production, expand, and always always we have been delivering against the odds of lots of people. And and so the targets that we had in '21, like reducing increasing the production, in in in safety, growth options, some sustainability disclosures on. Both have everything has been done or is in track.

25:45 So the last one was was giving back dividends.

25:51 Near term, we will continue with growth projects, basically, concentrating in our land, but we we don't care to look at, the future in other places. We continue to to work with the increased liquidity of the shares, and I think that's improving a lot. And you have probably seen that six, institutions, six brokers are now covering our company.

26:15 That's a signal of the interest of this company, all of them with very good, nice targets. And I think people are starting to realize that we are a serious company. One of the things we are doing, we said, is how can we dom redomicile the our parent company to The UK? And there is there are a few questions that I will we will answer about this. We are working on that. Long term, what are we going to be doing? Well, have a little bit not have all the eggs in the same basket, become a multi asset producer. Obviously, total is a is a is is our first goal. But if that one gets delayed, well, we will continue, insist, and be patient. But we have other growth options in in in the South Part of Spain. And even we are going to be looking at other parts of Spain and and the rest of the world.

27:09 We probably will be exposing ourselves to to other commodities if if if it's an opportunity. And one important thing strategic is to move to the main market. I mean, I know, we we inherited the situation with AIM. Okay? We have gone made a lot of changes, but the end game would be to move the main market, which provides more liquidity, more visibility, and we are we are working on that. I we say at the right time, but you all know that when we say at the right time, it's it's not going to be it's not going take long. So, look, in the presentation, besides besides what I've just mentioned, you will see the register summary of the registers, the recommendations of of shareholders, how are we compare with peers, I mean, compared in with in production, ratios, and so on. How how are we in costs, in all in sustaining costs? You would see that in page

28:10 29. And, will you all you'll also see a summary of the reserves, and you will also see a little bit of of of total and analytics. But, that's for any of you that want more details. In any case, I think the best thing is to to to get into the answering the question that have been submitted. We have had lots of questions, and they have been kindly summarized into groups back so that we try not to to leave any question unanswered. So with that, I will open it back to the to the moderator. Fantastic. That's wonderful, Alberto. Thank you so much. Thank you, Cesar, as well for the presentation.

28:57 Ladies and gentlemen, as Alberto said, we have had a number of questions, so please do continue to submit them just by clicking on the q and a tab, situated in the top right hand corner of the screen. Just while the team take a few moments to review those investor questions submitted already, I'd like to remind you the recording of the presentation along with a copy of the slides and the published q and a can be accessed via your investor dashboard on the Investor Meet company platform. I'd also like to remind you that your feedback is important to the company. And immediately after the presentation has ended, you'll be redirected for the opportunity to provide your feedback in order that the company can better understand your views and expectations. So, Alberto, as you as you did state, we've had a number of questions both presubmitted during today's live event. And perhaps if I could start the q and a session off with the first question, which relates to ELIX, and it comes in four parts, which I'll read out all four. And if you want me to repeat them as you go, do

29:46 let me know. It reads as follows. How much will it will it cost to build a full scale plant? How long do you expect it would take to build the full scale plant? And have you applied for any EU environmental initiative grants to support the cost of building the plant? If so, could that reduce the cost? How much could that reduce the cost by? And when we'll hear if that application is successful? And the final part, does ATLAS technology help to increase ATLAS reserve and resources? If so, can you quantify that for us? I appreciate four parts to that. And if you want me to repeat any, just please say No. I have them printed. Thank you very much. It's a complex question, and some of the the numbers are difficult to respond. But in general, yes. Look. The cost of building depends a lot on what is the final end product. Do you want cathodes of copper that LME, or do you want cathodes of copper that are not LME, but you will get paid 100%, but not with a premium?

30:42 Do you want pure cathodes of zinc, or do you want the zinc 99.9%?

30:49 The difference between the in the CapEx of one or the other is does it contain or not the SX section, the solar destruction section. The LX system is an electro mechanic electrochemical system where it dissolves, the sulfides in such a way that reduces the dissolution of some things that are not needed, like iron, for example. And once you have that dissolved, you have several ways. We have used to have a saying expression in Spain that problem problem dissolved, problem solved, which means that, basically, once you put the sulfides into into solution, you can recover the metals that are there. You can recover the metals into waste, by precipitation or by or and that can be followed by electrolytical, metal disposal or directly with electrolytical.

31:38 Depends on that, we will have the the cost of CapEx will be higher. The CapEx has been

31:45 calculated around between 5,000 and $6,000 per ton of copper produced, in general. I mean, depends on the the well, it could go up to 7,000, depends on the place. That's if it's built here in in Rio Tinto where we have a big infrastructure. If it was in some other place, it will be higher or lower, depends of of electrical the electrical situation, the land, and so on. How long does it take? Well, it would take, the first plant, we are probably going to be going through one line. It will take us around one year, not much more. The main question here are the electrolytic part, which have some delivery times. The rest is the tanks and so on. Tanks, pipes, and civil are are not that complex. Of course, there's lots of pipes and controls. So, basically, in one year from now before the end of the next year, we will be having something very likely in operation that will show us how it works.

32:40 Have you applied for any EU environmental incentives?

32:43 Well, not specifically ourselves, but we have been put into a within a group of initiative that has been, leadered, by ATALAYA MINING COPPER, which is a smelter owned by Freeport, where they put almost, I would say, almost couple of billion, I think it was, of initiatives that have to be initiatives that are multi regional, multi companies. So we were part of that. They were put in a refinery to recover scrap. We were put in part of the LX, and we were put in other initiatives. So we have put a lump sum there for this, but not formally applied for or nothing. This is basically to make sure that there is some money allocated, when the European Union spreads this. Once this is in operation and we will it's important to say that we are going to be doing something with Alex regardless of helps.

33:34 We have been investing a significant amount of money in the last six years. We have done this with our cash flow without any help at all. And, normally, without the minimum public release within in secret because it is so important. So we will do it regardless the the grants. If the grants are there, fantastic. How much it will reduce the cost? Well, we don't know. If we get the grants, that will be fantastic. Does this technology help to increase the reserves and resources? Well, look. What this technology does is because it's leaching, you don't need to separate the particles in pieces. Imagine a particle that has two millimeters is two millimeters, and is half of it is is a zinc metal. The other half is iron. The other half is copper. Well, you don't need to grind that and separate each of the small particles to be able to float them, which is the conventional route. You can break them in such a way that you can dissolve them. This means that you get better recovery in what you have. I mean, it means that things that were probably before were not economic may become economic.

34:49 So, I think that's the way it will happen. For example, a good example will be the the MASA Valverde, Mahadales deposit, or the San Antonio deposit. All of these have copper lead sink. If we went through the conventional route, which is the one, for example, applied by MATA, you use flotation and you may have a recovery, let's say, of around 75% of of copper, around 75% of of of zinc. If you use the leaching system, what you do is you have a global recovery of 90% to produce a bulk concentrate to a global concentrate, a dirty concentrate. And once you have that, you leach it you leach it, you dissolve it. And, basically, this is able to dissolve 95% of that dissolution. What does it mean that where you get the added value is getting higher recovery of a single ton that contains x metals?

35:44 This is important because, again, what matters is that you have to extract the ton from the from the ground. You have to grind it anyway. You have to extract it anyway. So the more you get makes it more economic, and, of course, it increase the reserves by being able to treat tons that otherwise will be marginal unless the metals were higher. I hope this is understood, but it's a fantastic, opportunity for us, we believe. Fantastic. Thank you, Alberto. The second, question, the theme around here is the solar plant. Couple of questions around it really. How much will it cost you to build? What is the latest approximation when the solar plant will be operational? Are there any grants to support this green initiative, and how does the 30% electricity cost reduction impact overall costs?

36:36 The plant, we are basically almost about to receive the final permit, which in our ground our ground, our land. It will cost between 25 and €28,000,000. That's the the those are the offers that we have right now. We will be building this we're already doing some civil work. It will be as soon as, as soon as we award it, it will be less than one year, normally around ten months, to to connect it. We have not, requested for any grants because the grants are excluded from certain sizes. At least in Spain, you only get grants for, up to x amount of of, kilowatts, and it will we are over that.

37:23 So I I am not aware of any grants where we can apply this, but we will do it regardless because it's it's responsible and because it's a it's also a good thing for us. The cost reduction of 30% comes basically, as a, as a matter of, of reducing the cost during the daytime. In our case right now, for you to make the numbers, obviously, the reduction depends on the price of electricity. The current price of electricity up to December is around 6¢ per per kilowatt hour. But you all know that in Europe and in Spain specifically, the prices of of of power are getting crazy due to the high prices of gas, and and lots of other reasons.

38:12 So we expect next year, the cost will be higher. So the savings will be higher. Right now, our in our cost structure, around 15% of the costs are are are power. So, if we could save a big amount of that, that's the amount that we can reduce it. So, it won't be a huge huge thing. It will not be a deal breaker, but certainly will help, to to mitigate one of our high higher cost initiatives. Fantastic. Thank you, Alberto. Next question we've got around, dividend. Thank you very much for the dividend. Very pleased. This question may have been, asked. But going forward, can we look to simplify dividend payment in consideration of Cypriot tax rules?

38:59 Maybe the person that has suffered this pain with the tax is Cesar. So maybe Cesar, you can take this question. But yes, I hope we can simplify. Yes. Thank you, Alberto. Hello, everyone. So for the inaugural dividend, we requested a tax form to be completed by all shareholders to avoid any withholding on the CPO tax. I mean, unfortunately, that was the instruction that we have been given by the tax office in Sagra. We're still in discussions with the tax office to ensure we don't have to withhold the dividend in the next payment that we're going to be doing on the March 1. So that's the situation now. We're currently having that sort of discussion with the tax office. So for 2022, so for next year, we have looked all the precedents in the country to ensure that we simplify the process as much as we can. And we also provide documentation in advance to tax office to ensure that they understand that we don't have any tax resident in our register and we hopefully can get some exemption. So that's the idea. So we still need to but that is interesting to be agreed and that's something that we're going to be starting working start to work on early next year.

40:16 Just taking advantage that we're speaking about dividend, I can also see that if we have been we will be paying a dividend for Q4 twenty twenty one, so there is no plan to do it now for now, but obviously it will depend on the cash generation of the company during the last quarter, which is actually quite good. As I have to mention, it's continued building up. But this is also that we also need to look at the cash requirement that we will have for the growth project that we have in the pipeline. So that's the current situation now for the tax and for the dividend in Q4 twenty twenty one. That's wonderful. Thank you, Cesar. The next question we've got here relates to domiciled in Cyprus. What advantage of being are there of being domiciled in Cyprus?

41:03 This is the legacy of our former CEO. I seem to remember it may give us some anti takeover protection, which does have value. Is it an alternative to Cyprus? And would it bring any advantage to change? Yes. Well, certainly something that we inherited. Probably, we would be establishing the company now. We would select another location to be a base or holding company. But and we did have for sure several internal discussion to evaluate if Cypress is the right place. I mean, the the country have offered many advantages to ATALAYA historically, such as the anti takeover protection that that that was mentioned in in the question. However, we have to look at ATALAYA in the current context and how are we currently working and we are currently working to migrate the holding company to The U. K. As we think that, that's the better fit that we have for the current situation for ATALAYA. So we currently have company listed in The UK that needs to be obviously in compliance with the regulation within the financial markets in The UK. We have an operation in Spain, and we have a holding company, which is based in being in fulfillment with the companies had in Cypress. So that requires a bit of complexity when we have AGMs, when we have EGMs, when we have any sort of transaction.

42:21 So this is why we think that moving to The U. K, it will fit better the company as it is now as we don't need the protection that we used to have when we were a smaller company, a junior company. Just an extension of the next question being is really how long is that process expected to take and what are the timescales around it, Cesar? Yeah, well, we have started already the process. That taken a bit of time. So we have analyzed what the steps that we need to take as it's not possible at hydro domiciliation as such. So we actually need to establish a new co in The UK and this new co will need to acquire all the share of the city holding company in Cyprus. So this is something that actually means that we have to delist the company and then start the process to IPO the new UK entity. And that will require some time and will also require the approval of the shareholder.

43:13 I mean, being said that, in terms of timing, we have really worked on the tax and we have completed some of the tax analysis and that's good. We are also looking to all the legal implication of the new coin in The UK. And we are finalizing also the accounting and all the implication of the migration. But in terms of the timing for the process, we are working on it. And I believe I'm confident that we will be completing the process in 2022. But it is a little bit of time to go through everything. Fantastic, Cesar. Thank you so much. Next question reads as follows. What's Satellite, doing to enhance trading liquidity? And I know, Alberto, you did pick up on this as we went through the presentation. But if there's anything further to add, please. Well, I think the the main thing is getting, getting on the road, doing lots of presentations, and introducing as much as possible to as many shareholders as possible because, we believe we are undervalued.

44:14 But there have been shareholders that have come in earlier, and they may want to take some profits out, and they are more conservative or have different views in copper price or different views in the the economy in the world. And that is what creates some happy sellers and has some happy buyers. So right now, that's what we are doing, trying to we have a significant float now. We have, institutions except the two big shareholders that control 44.4% of the company, which I have to say that, at a certain time, they would also be sellers. Who knows? But it's in the hand of institutions that, in the right time, they will be taking their profits or not and, bringing in new shareholders. We're quite happy how things are going, and we see volumes pick up every day and getting, hundreds of thousands of shares every day, which means millions of pounds, which is is good for for everybody.

45:08 Fantastic. Thank you, Alberto. Next question is in, Toro. Have you submitted revised environmental plan as you'd envisaged by the end of q three? If revised plans have been submitted, what was the agenda's initial reaction to the new plans? We we have not submitted an environmental, plan. And, really, what we will be submitting is a is a new project, a new design, which basically is almost finalized, but we want to make sure that everything is absolutely correct. It has not been submitted, and it's, it's almost ready. So there's no reaction of the junta. But what we're doing is making sure that we we we tick all the boxes and absolutely has absolutely no possibility of failure from the technical environmental point of view. The way we're the initiatives that we're taking have already been flagged by us, which is, first of all, is to increase this factor of safety of the tailings. Second is remove the water from the tailings, which means if there's no water, there's no possibility of of of having any catastrophic failure.

46:12 Third is taking, making sure there's no water discharge whatsoever in the in the rivers, in the creeks. Another one we are doing is we will take care of the past liabilities, of of the legacy liabilities, which are not our problem, but we are consistent. We know that we will have to do it and make sure that we do it correctly because this is the way to be have a have a long term long term operation. And besides that, there are other initiatives of, for example, thickening the tailings, recovery of water, not taking any water from from the river, just using the water from the rain, which we believe it's enough. So plastic lined tailings, that was already designed.

46:58 So, basically, increase increase safety, reduce the risk to basically zero, and demonstrate that, and also be transparent with our project and with, all the groups, including the groups that are against it, which may be truly against the project, or maybe sometimes we have to be careful if they are not political using this as a political, flag. But, we don't want to get into politics. We want to do things right because we want to be a long term, long term neighbor that's going to be there for a long time. So it would be stupid to do it wrong and then then have to stop because the rules in Spain, regardless what people may think are very strict, very strict, and we do not want to fail.

47:55 And we'll do whatever is needed, from the technical point of view to make sure this is done in the right way, and this is a model of quality that we can mirror ourselves. I have to say, by the way, that I am from that area. My father, my mother from that area. I I have uncles, and cousins living in in the place where I live. My sister lives there. By no means I'm going to allow any of my team to do things that are not perfect because this is all been beyond, what's an investment. So we are sure we are going to do it right, and we are trying to transmit that to the hometown. Fantastic. Thank you very much indeed. The next question reads, I hear that San Rafael has asked for authorization to build two water treatment plants at a cost of €1,300,000.

48:46 Has this been accepted by the Zunta Galacia as part of the targeted action by ATALAYA and and partners to bring older mining activity into line with current good practices, or is it a separate noncontingent or part of the new EIA? This is a very interesting company which comes obviously for somebody that knows, the place because these names, Pujallas and Portapewa are small creeks that run through the property. And I'm very happy to first explain what it is, to the to the audience, to the general public, and also explain to to the listening, listeners of this, which I'm sure they come, from from local local communities or the or the local authorities or whatever. First of all, there is a small problem. There is a problem, historic problem. A problem that's, is not part of of ATALAYA. ATALAYA is part of San Rafael.

49:38 San Rafael is the new company where we have the local partner, which is the owner of mineral rights. And as We are providing all the costs. We are providing all the technology, and they are kind of passive shareholders. It's not even the responsibility of the old, our old, our the old, people that took that that company and took that land. We are talking about water, rainwater that infiltrates infiltrates through the old tailings and comes out as slightly as acidic, but not in a big amount. We are talking about three liters per second. Okay. This is historic and actually corresponds to the mine operators, which were closed in 1987, but is there.

50:26 So this fact that does not belong to us and does not belong to to even the the existing owners of a property has been used to attack us and to say, well, if this is wrong, look. We we shouldn't allow the new new thing. Why this is not correct? It's not correct because, we're going to be using plastic lining. If if the owners in '87 had to use plastic lining, this would not be happening. This is clean water gets into contact and acidifies. Let's quantify what's going to these rivers, Pochelas, and Porto Pago. It's around three liters per second, which I don't know exactly how much is in in cubic meters per year, but it's not much. It does not contain a special specific metals. It contains iron iron.

51:17 But to put it in context, when we arrived to Rio Tinto, we had one pit that was flooded with 4,000,000 cubic meters of acid water, much worse than this. We have treated 4,000,000 cubic meters of water with its cost and use that water with absolutely zero discharge. We have done it in Rio Tinto. Why wouldn't we do it in this place? So going to the question, San Rafael, which is the local company, has asked for authorization to build water treatment plants. There's a problem there, and we said, you know what? Let's solve the problem regardless of the new project. So this problem, we want to resolve it. We, as a company, as a responsible neighbor, we want to resolve it.

52:06 And if it cost us this million and later we don't get the authorization of the new project, so be it. It will be irresponsible because we have shown that we can do it. We want to show that if things are done right, it can be sorted out. So it will be like somebody picking up garbage that's in the street and throwing it to the garbage can even if they have not thrown the garbage. We are responsible neighbor, and we are going to do it. Has been this accepted by the Shunta? Not yet. And it's a funny situation because those that are opposing the project are also opposing us to fix that.

52:57 And the reason is very simple. They want to use this as a flag because if there's a picture to be shown, there will always be something to show. If it's fixed, it won't be any problem. But we hope we can find a legal solution where, basically, a problem is sorted out, and it can be shown for the future that the same way that cars have changed in twenty five years, the same way that in the past twenty five years ago, all the villages and towns were throwing their sewage into the rivers, and this is not done anymore. I think we should understand that today technology allow us to do things in the right way, not only because we want to do it, which we want, also because there's laws and laws that we are going to fulfill simply because we're responsible, simply because we are in the we are acting in in for our shareholders, and our shareholders are asking us to do things right. Otherwise, they wouldn't invest in this company started by me.

54:06 So I know it's a long response. I hope my message is clear. ATALAYA is a serious company formed by people from the local that want to do things right and want to do things in the long term, and they're not scared of spending money to do things right like it had been done in Rio Tinto. And that's the way things are going to be done in total. I'm glad that this thing, is asked to let it very clear. We want to do things right regardless of the outcome of the EIA. With EIA, for you, it's it's, basically the environment impact assessment that's going to be, again, tested in the new in the new process.

54:55 Thank you very much, Alberto. The next one reads, ESG investing. The trend is to favor those listed companies who are meeting carbon footprint targets. Given you're investing in a solar electricity farm combined with other efficiency measures will probably improve ATALAYA's carbon footprint relative to those other miners and potentially tracked investment. Will you be investigating that, what agencies to work with so you can join and get green credentials and communicate that to the investment community? Yes. We're working on that already, and we have been we're first working with, somebody specialized in the world to provide us with a good ESG, ESG, report, transparent report for our past activities.

55:40 Very much like we have done in the exploration, we are we do much more things that we announce and we because we believe things have been done right, not so much of of saying them, but we do them right. So but, yes, we are working on that, and we will be, foreign part as an example company of those initiatives. The solar plan, we started this already two years ago, and when this ESG theme was not so so so much in fashion. And we do that because we believe it's the right way to do it. But, yes, we are working with that, and we have had lots of people, coming in and asking us about the way we work, because they may be interested in companies that are serious and and do things in the right way.

56:31 Fantastic. Thank you very much. I'm just conscious we are coming up to towards the hour. We have covered off a number of, investors' questions. If I just may ask you both just to click on that q and a tab and just have a final scan through just if there are any other questions you would like to respond to. If you could read them out and give your response to Alex, expect it to be completed. I think we mentioned that we will in one year from when we decide which will be quite soon. Interesting this one. How optimistic are you in copper price? How optimistic are you in copper price and an impact on your business? Well, we are optimistic. We had been optimistic already for years, and the reason is very simple. Building projects, as we have seen in total, I have seen as we have seen in Rio Tinto, is not easy. And it is not easy here. Imagine how easy it is to to build them in places where there's lots of deposits, like in in the Andes, Indonesia, and Africa. So building new copper is not easy. In the other hand, there is demand for the green wave, for demand for the electrification, demand for meeting our carbon targets in the worldwide. So it's not only China. It's the whole world needing these green initiatives, which means new copper. So higher demand, low supply, we believe copper price is going to stay low higher for longer.

57:51 And besides more hiccups, the new norm will be in the 4 and upwards dollars per pound. How do you expect the you you do you expect the limit higher, unit mining cost in q three to proceed in q four and going to 2,002 '22. Unfortunately, yes, diesel prices has an influence, and diesel price is high as you know. Until the diesel goes down, we will see it. The truth is that this is being compensated by by the by the, copper price because, also copper goes up. But, yes, unfortunately, the energy is important worldwide, and we will we'll have to to to bite the bullet, and and this is what it is. We are trying to do as much as we can by reducing the consumptions, but, unfortunately, the world is not in a in a difficult situation. Another interesting one is, how do you see copper demand and supply balance? I spoke a little bit Peruvian and Chile political situation.

58:53 What can you spend terms of production only in cost, m and a size of opportunities, Spain and abroad, terms of stocks change, where do things look. Yeah. I mentioned about Peru and Chile. It's in general situation is very complicated, everywhere. Peru and Chile produce are the first and second producer of the world. Chile alone produces, more than one, fourth of the production of the world, and things are not getting easy. With the copper prices high, also, there will be higher demand from from unions, from people, from taxes. Things are not easy. Peru, we have Castillo there, which has, their own his own view. It will not make it easy also to mess a new company. So this thing is is is is going to to hurt, supply.

59:39 Production in 02/22 and all in sustaining cost, we have flagged already what's going to happen in the last quarter. Well, we believe the 2002 will be similar in production. I think all in sustaining cost will be higher because of the terms of inflation. I mean, diesel will be higher. Price of steel will be higher. Explosive, very likely to be higher. So, yes, it will be higher worldwide, and and whoever says the contrary is probably lying because the reality is that we are seeing inflation all over the world. M and a and opportunities and size, well, we are con very, very focused, very concentrated in Spain and Europe in sizes. We are not going to be behind the big billion that can kill our company. We'll look at things that make sense and that can create value like like we have done in the past.

1:00:27 Metals in general, copper, but we were also happy with base metals, which will be in high supply. The one liquidity has increased. That's another question. That's good. Talking people ask us if the tax is going to be paid without the deduction. In in theory, we should deduct taxes for those that are resident in Cyprus. I think we have been in the five none of them of our shareholders have been in the five as Cypress residents. I think, we are working with the tax authorities of of Cypress to to prove that that really we don't need to do it because they are domiciled in The UK or in Spain or in in Canada or whatever. So that's the way we are working.

1:01:20 We will be the best in class if we do LX and solar. I think I agree 100% with this comment. And when does the market agreement end with Astor? Unfortunately, it still has to go for quite a while. It's capped at I think it's 43,000,000, and we are very close to to that. You will probably see that we are paying less. So he's a happy receiver of of of this money, but it has a an end like everything. We just consumed one hour and three minutes. Thank you very much. You've been you've been fantastic. Alberto, thank you. Cesar, thank you so much for answering every single question we've had come through. I'm sure it's greatly appreciated by the attendees.

1:02:05 And, Albasa, just before we redirect the attendees to give you some feedback, if I could just ask you just perhaps for a few closing comments before we get you Well, yes. Look, I would just like, again, first of all, the existing shareholders to be patient. Those that have been time, with time with us, I mean, we have delivered in our promises. We've worked hard. We have a very good team. Very proud of of being in ATALAYA, and, we thank them a lot for their support. It has been hard times. For those in the future, think of this company. We are a serious company that we always we don't overpromise. We deliver. So think of it. We don't we think we are a good company. That's all. I mean, I've said that before. Those have jumped in the in the train are happy riders, and there's still some time for the train to leave.

1:02:51 And, again, thank you very much. Fantastic. Alberto says, thank you so much for updating investors today. So please ask investors not to close the session as you'll be automatically redirected for the opportunity to provide your feedback in order that the management team can better understand your views and expectations? This will only take a few moments to complete and is greatly valued by the company. On behalf of the management team of ATALAYA MINING PLC, we'd like to thank you for attending today's presentation. That now concludes today's session. Thank you, and good morning. Thank you very much.