Daniel Major

Daniel Major asked about the strategic rationale behind a partial IPO of Barrick's North American gold assets (NGM and PV) versus a full separation, the intended use of IPO proceeds, discussions with Newmont regarding JV agreement clauses on ownership changes, and the latest status of Reko Diq financing.

Answer

Graham Shuttleworth, Senior EVP and CFO, explained that the board believes a partial IPO will unlock value by highlighting the undervalued North American assets, leading to a re-rate for all Barrick shareholders. He noted that the use of proceeds is still being determined as the process is ongoing, targeting Q4 completion. Shuttleworth confirmed Barrick is comfortable with its progress and honors all legal contracts regarding the Newmont JV. Regarding Reko Diq, he stated that the board is concerned about the security situation in Balochistan and has requested a review, which has paused the financing closure.

Daniel Major inquired about Barrick's strategic rationale for a partial IPO of North American assets (NGM and PV) versus a full separation, the intended use of IPO proceeds, discussions with Newmont regarding JV agreement clauses on ownership changes, and the latest update on Reko Diq financing.

Answer

Graham Shuttleworth, Senior EVP and CFO, explained that the board believes a partial IPO will unlock shareholder value by highlighting the undervalued North American assets. He noted that the use of proceeds is still being determined as part of the IPO preparation, targeting Q4 completion. Shuttleworth confirmed Barrick's awareness and respect for all legal contracts, including the Newmont JV agreement, and expressed comfort with the ongoing progress. Regarding Reko Diq, he cited security concerns in Balochistan as the reason for a review, which is delaying the financing closure.

Questioned the cash consumption in Mali and potential care and maintenance costs, the status of Zaldivar in the portfolio rationalization, and whether the company would consider separating assets based on jurisdictional risk to unlock value.

Answer

The current run rate in Mali is about $15M/month, which could be halved under full care and maintenance, though this is not the current plan. The focus for Zaldivar is renewing its mining license. The company will not separate assets by jurisdiction, arguing that a global portfolio provides strength and that long-term value creation is superior to the short-term harvesting seen in so-called 'low-risk' jurisdictions.

Inquired about the expected run rate for the share buyback program, requested a breakdown of the 2025 project CapEx for Lumwana and Reko Diq, and asked if the Mali situation could impact funding for major growth projects.

Answer

The share buyback will continue as long as the share price is low, balanced against the needs of the large capital program. For 2025, project CapEx is guided at ~$0.6B for Lumwana and ~$1B (100% basis) for Reko Diq. The company is comfortable it can manage its growth project funding even without cash flow from Mali.

Asked about Nevada cost drivers, the cash impact of a tax settlement in Chile, the go-forward approach to share buybacks, and the outlook for G&A and exploration spending versus guidance.

Answer

Improving performance at Turquoise Ridge (along with Carlin and PV) is key to meeting cost guidance. The Chile tax charge will become a cash payment in Q3. Share buybacks will continue on a measured basis, supported by a strong balance sheet. The lower G&A and exploration spend is intentional and reflects efficiency and a disciplined focus on priorities.

Daniel Major asked about the accounting for CO2 compensation, specifically if it's a recurring Q4 item and its quantum, and if the Q4 recognition was an incremental positive versus the Q3 outlook. He also asked for a sense of the expected proceeds from the legacy site divestment.

Answer

Molly Beerman, EVP and CFO, explained that the Q4 CO2 compensation recognition was due to receiving feedback on qualifying projects and R&D spend, and it won't recur at the same level as a 'call-out item' but will be more regular in 2026. She noted that about half was embedded in the Q3 outlook, but more qualifying expenditures were found. She declined to quantify the legacy site divestment proceeds until closing, citing complex installment-based arrangements.

Daniel Major asked about the recurring nature and quantum of the CO2 compensation accrual in Q4, whether it was an incremental positive relative to the Q3 outlook, and for an update on the expected proceeds from the legacy site negotiation.

Answer

Molly Beerman, Executive Vice President and Chief Financial Officer, explained that while CO2 compensation was previously accrued, the conditional portion required project application. Feedback allowed a credit against R&D in Q4, which will be more regular going forward but not recur as a 'call-out item' at the same level, depending on qualifying spend. She confirmed it was an incremental positive in Q4 due to more qualifying expenditures than expected. She stated Alcoa would hold off on disclosing proceeds from the legacy site negotiation until the deal closes, given its complexity and installment-based payments.

Daniel Major asked if the cost-plus-margin pricing applies to all gallium volumes, inquired about the JV's ownership structure and Alcoa's equity participation, confirmed the mid-2026 target for San Ciprian smelter's steady state, and sought drivers for the recent uptick in Midwest and European aluminum premiums.

Answer

William Oplinger, CEO, confirmed that all gallium volume would be cost-plus, with Alcoa's offtake being very small (around 5 tons of 100-ton capacity). He stated the JV ownership is 50% Japanese and 50% U.S./Australia/Alcoa, with Alcoa's specific share of the latter 50% not yet public. Molly Beerman, CFO, affirmed the target for San Ciprian smelter to reach full run rate by mid-2026 and profitability in the second half of 2026. William Oplinger attributed Midwest premium increases to covering full tariff costs, and European premiums to uncertainty around potential Mozal and recent Century smelter shutdowns, noting both markets remain in deficit with tight supply.

Daniel Major sought clarification on whether the gallium project's cost-plus-margin pricing applies to all volumes and details on the JV's ownership structure and Alcoa's equity participation. He also asked for confirmation on the mid-2026 target for San Ciprian smelter's steady state and the drivers behind recent upticks in Midwest and European premiums.

Answer

William Oplinger, CEO, confirmed the cost-plus-margin applies to all gallium volumes, with Alcoa taking a very small offtake (around 5 tons of 100-ton capacity). He stated the JV ownership is 50% Japanese and 50% U.S./Australia/Alcoa. Molly Beerman, CFO, confirmed the mid-2026 target for San Ciprian's full run rate and profitability in late 2026. Oplinger attributed premium increases to the Midwest covering tariff costs and European uncertainty from Mozal/Century shutdowns, with Molly Beerman adding that both markets remain in deficit with tight supply.

Daniel Major asked for clarification on the Q3 tariff cost run-rate and inquired about the financial expectations for the San Ciprian complex in 2026, particularly regarding cash burn for the smelter and refinery.

Answer

EVP & CFO Molly Beerman confirmed the Q3 tariff cost outlook and stated that for 2026, the San Ciprian smelter is expected to be profitable once fully ramped by mid-year, but the refinery will likely remain in a loss position at current alumina price levels.

Daniel Major sought to clarify tariff sensitivities, asking if a specific rise in the Midwest premium would neutralize the tariff's impact. He also requested an update on the release of restricted cash at San Ciprián and its intended use.

Answer

President and CEO William Oplinger reiterated that the Midwest premium has not reacted as expected due to market uncertainty and inventory levels. EVP and CFO Molly Beerman reported that $12 million of restricted cash has been released, but the remaining ~$75 million is subject to ongoing discussions, with $50 million being contentious as it's tied to a deferred capital project.

Daniel Major of UBS questioned the current cash balance at the San Ciprián facility, the certainty of a deal following the recent MOU, and the potential for Alcoa to monetize excess energy capacity for data centers.

Answer

EVP and CFO Molly Beerman confirmed that San Ciprián's cash is still depleting, creating urgency. President and CEO William Oplinger described the MOU as a positive step but not a guarantee for a restart, as agreements with unions and energy suppliers are still needed. Regarding energy monetization, Oplinger identified the primary opportunities as being in Brazil and at the Warrick, Indiana facility.

Daniel Major questioned at what stage the two specific AEX permits for Great Bear, which are taking longer than anticipated, would start to impact the overall project timeline.

Answer

Will Dunford, VP and General Director of CMGC, clarified that AEX focuses on early drilling for the underground, while the main project's first production is driven by mill construction and open pit ore, thus AEX permits are not critical path. Geoff Gold, President, added there's no direct link between AEX and main project permits, and no similar delay is expected for the main project.

Daniel Major inquired about Kinross Gold's future capital return commitments given its strong free cash flow, the expected working capital reversal for tax payments in Q1 next year, and the potential impact of Great Bear's AEX permitting delays on the overall project timeline.

Answer

Paul Rollinson (CEO, Kinross Gold) stated that while they are in the budget cycle, the company aims to continue healthy capital returns, primarily through buybacks, and will provide an update in the new year. Andrea Freeborough (EVP and CFO, Kinross Gold) specified that tax payments for Q1 next year are expected to be close to $400 million, with over $300 million related to Brazil. Will Dunford (VP and General Director of CMGC, Kinross Gold) clarified that AEX is for early drilling and not on the critical path for the main project's first production, with Geoff Gold (President, Kinross Gold) adding there's no direct link or expected similar delay for the main project.

Daniel Major inquired about the Cobre Panama restart, asking which catalysts (environmental audit, fiscal terms, workforce remobilization) are most likely to be bottlenecks and if the year-end timeline is realistic. He also asked about the initial scope and timeline for the Arthur Gold Project.

Answer

Paul Brink, President and CEO, Franco-Nevada Corporation, stated that President Mulino's year-end timeline for Cobre Panama is ambitious but potentially achievable, noting positive shifts in sentiment and ongoing on-ground activities. He highlighted constructive comments from the President and acknowledged the value of the mine to the economy. Eaun Gray, Chief Investment Officer, Franco-Nevada Corporation, expressed enthusiasm for the Arthur Gold Project with AngloGold, citing phenomenal geological upside. He mentioned AngloGold's initial focus on a Merlin-focused plan and expressed hope for permitting progress, projecting a mine start in the early 2030s.

Daniel Major asked about the potential bottlenecks for the Cobre Panamá restart, including the environmental audit and fiscal terms renegotiation, and whether a year-end resolution is realistic. He also inquired about the initial scope and timeline expectations for the Arthur Gold Project.

Answer

Paul Brink, President and CEO, stated that President Mulino's year-end objective for Cobre Panamá resolution is still possible, noting positive shifts in sentiment, ongoing audit, and rehiring efforts. Eaun Gray, Chief Investment Officer, expressed enthusiasm for the Arthur Gold Project with AngloGold, anticipating a Merlin-focused start, continued exploration, and a hopeful mine start in the early 2030s, benefiting from a positive U.S. permitting environment.

Daniel Major sought clarification on the remaining gold inventory, questioned why guidance was not raised despite new contributions from Cote and Cobre Panama, and asked about the potential scale of the New Prosperity stream.

Answer

CFO Sandip Rana confirmed 2,469 gold ounces remain in inventory and explained that guidance was maintained because the company was already on track to meet its range, with the new assets providing incremental upside. President & CEO Paul Brink estimated the New Prosperity stream could contribute 40,000-50,000 gold ounces annually if developed.

Daniel Major sought clarification on the remaining gold inventory, asked for the offset in guidance which remained unchanged despite new contributions, and inquired about the potential scale of the New Prosperity stream.

Answer

CFO Sandip Rana confirmed 2,469 gold ounces remain in inventory and explained that guidance was maintained because the company was already on track within the range, making the new contributions from Cote and Cobre Panama incremental upside. President and CEO Paul Brink estimated the New Prosperity stream could contribute 40,000-50,000 gold ounces annually if the project proceeds.

Daniel Major questioned if the Panamanian government has requested Franco-Nevada to drop its arbitration claim regarding Cobre Panama, sought guidance on the expected performance of the diversified/energy portfolio for the remainder of the year, and inquired about the M&A pipeline's focus, particularly on base metals and Argentina.

Answer

President and CEO Paul Brink stated that Franco-Nevada is a financier, not at the main negotiating table for Cobre Panama, but is open to suspending (not dropping) its arbitration under the right conditions. CFO Sandip Rana projected a reasonably flat profile for energy assets, contingent on commodity prices, noting potential volume declines if lower prices persist. Eaun Gray, SVP, Business Development, commented that the M&A market remains most active for gold royalties and streams, with fewer opportunities in other metals, and offered no specific comments on Argentina.

Daniel Major inquired about Newmont's capital allocation strategy and balance sheet management, specifically whether the company would accelerate share buybacks or cash returns in 2026 given its near-zero net debt position and sustained high gold prices. He also asked for updates on the project pipeline, including any delays to the Red Chris Block Cave project and progress on other longer-dated projects like Yanacocha and Wafi-Golpu.

Answer

Natascha Viljoen, President and COO of Newmont Corporation, affirmed the company's commitment to its disciplined capital allocation framework, noting that returns to shareholders are reviewed quarterly with the board. She emphasized focusing on operational performance, safety, cost, and productivity. Regarding projects, Ms. Viljoen confirmed Red Chris remains on track for a board proposal by mid-next year, with learnings from a recent incident incorporated into the feasibility study. She added that longer-dated projects must earn their place in the portfolio for capital allocation.

Daniel Major inquired about Newmont's capital allocation strategy and balance sheet management, specifically asking if the company would accelerate share buybacks or cash returns in 2026, given its near-zero net debt position and sustained high gold prices. He also asked for updates on the project pipeline, including any delays to the Red Chris Block Cave project following a recent incident, and the status of other longer-dated projects like Yanacocha and Wafi-Golpu.

Answer

Natascha Viljoen, President and COO, stated that Newmont remains committed to its well-defined capital allocation framework and will continue to review shareholder returns quarterly with the board, emphasizing discipline. Regarding projects, Ms. Viljoen confirmed that Red Chris is on track for a board proposal by mid-next year, with learnings from the incident being incorporated into the feasibility study. She added that longer-dated projects must earn their place in the portfolio for capital allocation.

Daniel Major from UBS Investment Bank asked about management succession following the CFO's departure and inquired about the second-half cash flow outlook, including working capital effects and deferred divestment proceeds.

Answer

President and CEO Tom Palmer affirmed the strength of the finance team under Interim CFO Peter Wexler and described Natasha Viljoen's promotion to President as part of normal leadership development. He noted that second-half free cash flow will be impacted by higher sustaining capital, increased reclamation spend, and taxes, while also detailing the status of remaining deferred proceeds from asset sales.

Daniel Major questioned if the portfolio is now considered optimal post-divestments, specifically asking why relatively higher-cost assets like Merian and Cerro Negro remain in the core portfolio. He also asked if share buybacks could significantly exceed divestment proceeds given the high gold price.

Answer

Executive Tom Palmer stated that the immediate focus is on bedding down the new go-forward portfolio, which the team has only had for a week, and delivering on the potential of all its assets, including the 'emerging Tier 1' assets. CFO Karyn Ovelmen reiterated the capital allocation policy: after funding the business and the fixed dividend, any excess free cash flow generated will be returned to shareholders via share buybacks, implying that strong gold prices would fuel further repurchases.

Daniel Major from UBS noted that the 10-year average production guidance of 6 million ounces seems conservative given the project pipeline and asked if something was missing. He also questioned why G&A costs are guided to be so high in 2025 despite synergies from the Newcrest deal.

Answer

CEO Tom Palmer confirmed production will likely exceed 6 million ounces in the near term but will ebb and flow over the decades-long life of the portfolio, making 6 million ounces a reasonable long-term average. He acknowledged G&A is 'unacceptably high' due to costs associated with integrating systems and managing assets held for divestment, and expects it to decline as divestments are completed.

Daniel Major from UBS questioned the credibility of future cost reductions, given that 2024 all-in sustaining costs are higher than February's forecast, and asked if limiting inflation is a more realistic outcome. He also sought clarification on the 2025 gold production guidance after accounting for reductions at Lihir and Brucejack.

Answer

Executive Tom Palmer acknowledged the historical link between gold prices and production costs, noting that prior long-term forecasts excluded escalation. CFO Karyn Ovelmen added that higher 2024 costs, driven by contracted labor, are expected to trend into 2025. Tom Palmer confirmed the core portfolio's 2025 gold production is expected to be around 5.6 million ounces, with costs remaining broadly flat year-over-year.

Daniel Major from UBS sought confirmation on the 2026 tax payment amount, clarification on gold delivery mechanics, details on the deal pipeline's asset mix, and the company's capital allocation strategy regarding dividend growth.

Answer

SVP & CFO Vincent Lau confirmed the tax payment amount is approximately $112M and that Wheaton takes delivery of credits from mining partners, not refineries. President Haytham Hodaly noted the deal pipeline is roughly two-thirds by-product streams. CEO Randy Smallwood explained that dividend growth is balanced against capital deployment; less M&A could mean higher dividend growth.

Daniel Major from UBS asked about the operational impact of recent downtime at the Antamina mine, its production profile leading into 2026-2027, how to model share-based compensation, and the company's capital allocation plans for its significant cash balance.

Answer

VP of Mining Operations, Wes Carson, confirmed the Antamina incident caused a brief 36-hour shutdown with no expected impact on full-year production and noted a significant ramp-up is expected through 2027 as mining moves into higher-grade silver zones. SVP & CFO Vincent Lau provided a go-forward run rate for modeling share-based compensation. SVP of Corporate Development Haytham Hodaly and CEO Randy Smallwood stated that given a robust pipeline of double-digit streaming opportunities, the company intends to deploy its capital on accretive deals rather than consider special distributions.

Daniel Major from UBS inquired about the front-loaded structure of the Montage transaction and whether this represents an evolution in deal strategy. He also asked about the associated risk profile, Wheaton's potential involvement in a First Quantum stream, and the expected timing for the normalization of produced but not delivered (PBND) volumes.

Answer

President and CEO Randy Smallwood described the Montage deal as a unique structure that allowed the project to be funded without traditional debt. SVP, Corporate Development Haytham Hodaly added that it offers a quick payback and strong security. SVP & CFO Gary Brown noted that being the primary creditor can be less risky as it provides more control in a downside scenario. Regarding PBND, Gary Brown expects volumes to normalize to the midpoint of the 2-3 month range in Q1 2025.

Daniel Major from UBS Investment Bank asked if the potential to accelerate CapEx was more applicable to 2026-2027 rather than 2025. He also questioned whether the company sees an opportunity to monetize non-core assets in its investment portfolio and asked about the grade profile outlook for the Fosterville mine.

Answer

EVP & CFO Jamie Porter confirmed that significant incremental spending would likely occur beyond 2025, driven by projects like Hope Bay and optimizations at Odyssey. President and CEO Ammar Al-Joundi acknowledged that while the portfolio is for strategic insight, monetizing assets that don't fit the long-term plan is a reasonable consideration in a high-price environment. EVP & COO Natasha Vaz clarified that Fosterville's strong H1 was due to mine sequencing and a softer H2 is expected.

Daniel Major of UBS asked about the company's capital return strategy, including whether it would build a large net cash position and the preferred mix between dividends and buybacks. He also requested an update on the timeline for studies and a final investment decision (FID) for the Hope Bay project.

Answer

An executive, Mohammed Ali, confirmed the company is comfortable building a net cash position over $1 billion and intends to increase share repurchases. CEO Ammar Al-Joundi stressed capital discipline. Executive Dominique Girard projected a potential greenlight for Hope Bay in early 2026, after detailed engineering is over 50% complete to de-risk the project.

Daniel Major of UBS inquired about the production profile beyond the three-year guidance, specifically asking for an update on the potential for a life-of-mine extension at Meadowbank to bridge any production gap before major projects come online in the early 2030s. He also requested an update on the licensing progress at the San Nicolás project.

Answer

Dominique Girard, SVP, stated that the team is evaluating scenarios to extend Meadowbank's life with underground operations post-2028, potentially producing around 150,000 ounces annually until 2035. Natasha Nella Vaz, SVP, addressed San Nicolás, confirming that the environmental permit applications are progressing with regulators, but the impact of potential constitutional changes on open-pit mining remains uncertain.

Daniel Major of UBS Investment Bank asked if Indonesian smelter volumes are contractually committed, which could limit sales to the U.S., and requested guidance on Q3 working capital.

Answer

President & CEO Kathleen Quirk clarified that while near-term plans are to sell cathode in Asia and domestically in Indonesia, they are not locked into long-term contracts and retain marketing flexibility. Regarding financials, she indicated a working capital use in Q3 that is expected to reverse in Q4, resulting in no material working capital requirement for the full year.

Daniel Major from UBS inquired if Indonesian smelter volumes are contractually committed in a way that would prevent sales to the U.S. and asked for Q3 working capital guidance.

Answer

President & CEO Kathleen Quirk clarified that while near-term plans are to sell cathode in Asia due to logistical advantages, they are not locked into long-term contracts and retain flexibility. Regarding working capital, she indicated a use of cash in Q3 that is expected to reverse in Q4, resulting in no material impact for the full year.

Asked for clarification on the North American cost guidance, specifically the potential impact of tariffs which were excluded, and the proportion of the cost base exposed to energy prices like oil.

Answer

The company is working to mitigate tariff impacts, which could affect about 60% of their U.S. costs (excluding labor/services). They are confident they can manage these potential costs. Regarding energy, they have seen a benefit from lower diesel prices, which helps offset some upward pressure on electricity costs. The guidance was based on the same oil price assumption as the start of the year.

Asked about insurance coverage for the Grasberg smelter fire, the timeline for license extension negotiations with the new Indonesian government, and visibility on the U.S. critical minerals legislation in the Senate.

Answer

The ~$100 million smelter repair cost is covered by insurance. The company is already engaged with the new Indonesian government and hopes to apply for the license extension in 2025. There is no visibility on the timeline for the U.S. Senate's review of the critical minerals bill.

Daniel Major asked about insurance coverage for the Grasberg smelter fire, the timeline for license extension discussions with the new Indonesian government, and visibility on the U.S. Senate's review of the critical minerals bill.

Answer

President and CEO Kathleen Quirk confirmed the estimated $100 million in smelter repair costs are covered by insurance. She stated that discussions with the new Indonesian government are underway, and the company hopes to apply for the license extension in 2025. Regarding the U.S. bill, she noted there is no visibility on the Senate's timing.

Daniel Major asked if the company plans to resume share buybacks in the coming quarters and inquired about Freeport's view on participating in larger-scale M&A as the sector sees more consolidation.

Answer

President and CEO Kathleen Quirk confirmed that under the company's financial framework, excess cash flow is available for share repurchases. Chairman Richard Adkerson added that while the company actively observes the market, large-scale M&A is not fundamental to its strategy, as the primary focus remains on creating value through its extensive organic growth pipeline. He characterized Freeport's M&A stance as being prepared to respond to opportunities rather than pursuing a predetermined strategy.

Daniel Major of UBS asked about assurances regarding capital controls for the MARA project in Argentina, the company's broader acquisition strategy in the aluminum value chain, and the potential for future capital reservations for M&A deals.

Answer

CEO Gary Nagle stated it was too early for specifics on MARA's capital controls but assured they would be "world-class." He also indicated that while the Alunorte deal was a unique opportunity, the company is not aggressively pursuing large M&A in the aluminum space. CFO Steven Kalmin added that reserving capital for M&A would only be considered for very large, multi-billion dollar transactions, unlike the recent Alunorte acquisition.