High CapEx for Bagdad Expansion
Q: Is $3.5B CapEx for Bagdad expansion the new normal?
A: Management acknowledges that the $3.5 billion capital expenditure for the Bagdad expansion reflects a new normal for concentrator and mining infrastructure costs due to factors like low ore grades and necessary investments. They emphasize that while the project may seem expensive, benefits like no royalties, lower U.S. tax rates, strong community support, and existing infrastructure make the economics favorable compared to international projects.

Unit Cash Cost Guidance
Q: Why is full-year unit cash cost guidance higher than Q1?
A: The first quarter benefits from delayed gold shipments boosting the gold-to-copper ratio, leading to a lower net unit cash cost of $1.55 per pound. The full-year guidance of $1.60 per pound is higher due to assumed continuation of Indonesian export duties, which may decline as the new smelter ramps up in the second half of the year.

M&A Prospects
Q: Is M&A of producing assets being considered?
A: Management is constantly monitoring the market but hasn't found attractive M&A opportunities. They believe focusing on internal growth projects like the leach initiative and Kucing Liar project offers better value for shareholders, making external acquisitions less compelling.

Indonesian Concentrate Export License
Q: What's the status of the concentrate export extension post-May?
A: The current export license in Indonesia expires in May 2024, and discussions with the government are ongoing. Both parties are aligned due to the government's stake and tax revenues, and management is optimistic about securing an extension to cover the smelter ramp-up period.

Capital Allocation Priorities
Q: How do leach initiative and Bagdad expansion fit in capital plans?
A: The leach initiative is prioritized due to its low capital investment and low incremental operating cost, making it a "no-brainer". The Bagdad expansion is being positioned for future execution but isn't an immediate priority; both projects are seen as complementary in meeting future copper demand.

Leach Initiative Details
Q: What's the timing and CapEx for the leach initiative?
A: Management aims to add 200 million pounds of incremental production over a couple of years through the leach initiative. The project requires minimal capital as existing infrastructure and tank house capacity are utilized, with incremental operating costs around $1 per pound.

Cost Trends at Morenci
Q: Can site production costs at Morenci decrease?
A: Management is focused on reducing costs, acknowledging that low ore grades and inflation have increased expenses. Initiatives include increasing leach production, reducing reliance on expensive contractors, and exploring operational efficiencies to drive costs lower over time.

Dividend Outlook
Q: Is the current dividend level sustainable for 2024?
A: The Board regularly reviews financial policies, and while the financial position is strong with positive 2024 projections, any changes to the dividend will be considered carefully to avoid increasing debt. Management believes the current financial position supports the existing dividend level.

TCRC Contracts
Q: Can lower spot TCRC rates be renegotiated into contracts?
A: Most TCRCs are set in annual fixed contracts, so current lower spot rates don't immediately impact existing agreements. As the new Indonesian smelter comes online, reliance on external smelters decreases, which may reduce exposure to TCRCs over time.