Good afternoon, ladies and gentlemen. We will proceed into the annual general meeting of Bougainville Copper Limited. I extend a warm welcome to all of you to the 59th annual general meeting of Bougainville Copper Limited. My name is Kearnneth Nanei , and I am the company's chairman. Our meeting today will once again be streamed live, allowing shareholders, proxies, and guests to participate in this year's annual general meeting virtually. All online attendees can view the meeting, and shareholders and proxies have the ability to ask questions and submit votes. You can ask questions at the physical meeting or via live text facility at any time. Please take note that while you can submit questions from now on, I will not address them until the relevant time in the meeting.
Please also note that your questions may be moderated, or if we receive multiple questions on one topic, this will be combined or amalgamated together in answering. Finally, due to the constraints, we may run out of time to answer all your questions. If this is the case, we will answer them after the meeting by emails and by posting responses on the website. In accordance with Section 6, Paragraph 9 [A1] of the BCL constitution, voting today will be conducted by a way of poll on all items of business. In order to provide you with enough time to vote, online registration opened 30 minutes prior to the start of this meeting. If you are eligible to vote at this meeting, you may cast your vote at the appropriate times while the meeting is in progress.
I will give you a warning before I move to the closed voting. I understand that each member has received a notice of the meeting, and I propose to take the notice as read. Shareholders attending the physical meeting have been given a voting card upon registration. Please complete your voting at the time, and then so you return your card at the conclusion of this meeting. Visitors who are not shareholders in the company are welcome to attend the meeting as observers. However, you are not entitled to ask questions or vote. Nevertheless, I hope you find the proceedings interesting. At the meeting today, we have from my right, Executive Director Sir Melchior Togolo, Non-Executive Director James Rutana , Non-Executive Director Maryanne Hasola . I now turn to the chairman's statement.
On behalf of the board and the management of Bougainville Copper Limited, I would like to welcome you all to our 2026 Annual General Meeting. As chairman, this provides me with a great opportunity to update you on the affairs of the company over the last 12 months. Whilst the company has continued to progress its work under its exploration license, it has been a period of significant transition of Bougainville Copper Limited, with the Autonomous Bougainville Government becoming for the first time our major shareholder. Before providing a formal update, I would like to acknowledge the recent challenges faced by the people of Bougainville in the wake of Cyclone Maila last month. As a company, we are proud of the efforts of our local engagement team, which were among early responders to the fatal landslide at Asiko Village in Kongara.
The team provided essential food, first aid, and transport assistance to those who have been affected, as well as ongoing support to other communities in the Panguna area impacted by the inclement weather events. The ABG has consistently made clear the importance of Panguna's redevelopment to Bougainville's economic development. The re-election of President Honorable Ishmael Toroama in September 2025 provided the project with a renewed momentum. In January 2026, the transfer of shares from the Independent State of Papua New Guinea to the Autonomous Bougainville Government was finally completed. As a result, the ABG and the people of Bougainville now own a total of 72.9% of the shares on issue. As the major shareholder in BCL, on the 4th of February, the Bougainville Executive Council approved the engagement of Lloyds Metals and Energy Limited as ABG's preferred partner under a contract mining or services partnership model.
Separately, in November 2025, the ABG signed a non-binding memorandum of understanding with Lloyds Metals to establish a framework of cooperation on major development projects in the Autonomous Region of Bougainville. As a result of the ABG's decision, on the 8th February 2026, BCL entered into a non-binding cooperation agreement with Lloyds Metals to enable it, within an exclusivity period of 90 days, to undertake necessary technical and commercial due diligence relating to Panguna Mine. Given BCL's limited financial and technical resources, notwithstanding the significant intellectual property, intimate project knowledge, and established relations with land owners, a partner is required to support the advancement of the gamut, pre-feasibility and feasibility work necessary for Panguna's redevelopment. The past year has also unfortunately brought a deep sadness for BCL with the sudden passing of our Chief Executive Officer, Mr. Johnny Patterson Auna , last August.
Johnny was a highly respected executive who brought over 35 years of experience and invaluable knowledge to his role. His sound judgment and strong leadership across government, business, and the community enabled him to make meaningful contribution during his tenure. Johnny is greatly missed by all of us. Following the passing of Mr. Auna, the board appointed Sir Mel Togolo as the acting CEO, a role he continues to hold. In March 2026, Sir Melchior Togolo stepped down as Chairman. I was honored as the new Chairman. In February 2026, we also saw the resignation of long-serving directors, Sir Moi Avei and Mr. Peter Maxwell Graham. Both Sir Moi and Peter made very significant contribution. Their connection to government, deep corporate and technical knowledge provided invaluable during the company's transitional phase. We sincerely thank them for their services.
For the year ended 31st of December 2025, the company recorded a loss of PGK 16 million compared to a loss of PGK 13.4 million the previous year. Expenditure was concentrated on meeting exploration licence number one commitment, including a major community awareness and data collection process to support the completion of landowner identification study. The company also conducted the strategic partnering process, supporting remedial work associated with legacy infrastructure and small-scale mining activities. The company has a total consolidated net asset of PGK 73.9 million compared to PGK 80.4 million the previous year. The Bougainville Copper Foundation is a fully owned subsidiary of BCL, with its balance sheet consolidated with BCL as of 31st December 2025. The company has sufficient funds to cover planned recurrent expenditure in 2006 and remains debt-free. It will not pay a dividend. Bougainville Copper's financial assets are cash and Australian equities.
Interest and dividends from these assets continue to partially fund the government's activities. Income from interest and dividends in 2025 was PGK 3.5 million compared to PGK 3.4 million in the previous year. The fair value of investments increased PGK 9.5 million for 2005 compared to an increase of PGK 2.3 million in the previous year. Realized gains on sales of investments for the year of PGK 8.8 million compared to PGK 6.4 million in 2024 and are recorded in the income statement but are reported by a transfer directly to retaining earnings in the shareholder funds. Equities are only sold when necessary to fund ongoing company operations.
As previously noted, the transfer of 36.4% shareholding from the Independent State of Papua New Guinea is now complete, solidifying ABG's position as controlling majority shareholder with the scope to determine the strategic direction of the company on behalf of the people of Bougainville. The company continues to work collaboratively with the Autonomous Bougainville Government and Rio Tinto in response to the independently conducted Panguna Mine Legacy Impact Assessment. A major milestone was reached in April 2026 with the formal launch of hazardous materials removal at Loloho Port , following the Panguna Mine Legacy Impact Assessment phase I findings. BCL is also managing remedial works at four other priority sites, including the demolition of unstable walls in Panguna Township, which was successfully completed in January 2026, as well as the planned replacement of Momau Bridge .
On the 26th of September 2005, the PNG National Court dismissed entirely the previously reported representative proceedings of class action filed against the company concerning the Panguna Mine. Indemnity costs were awarded in favor of BCL and Rio Tinto as defendants. The lead complaint filed an appeal in the Supreme Court on the 3rd of November 2025, and the company will continue to vigorously defend its position. Effective local engagement underpins the progress of BCL, the progress that BCL has made in advancing the Panguna project over the past decade. During 2025, we oversaw a major community awareness program and completed the required landowner identification study. More recently, the ABG-led integrated community engagement in Panguna to clarify partnering arrangements. The company has also scaled up our Bougainville engagement team to 15 members to support the increasing activities on the ground.
BCL continues to provide modest yet meaningful support for the local initiatives, including school facility upgrade and backing for grassroots sports and cultural events. These efforts, alongside our humanitarian response following Cyclone Maila, assist us in continuing to build trust and goodwill with the local people on Bougainville. The Bougainville Copper Foundation continues to award scholarships to tertiary students from Bougainville. Applications opened in November 2025, resulting in 20 scholarships being awarded for 2026 to undergraduate students at PNG tertiary institutions. While funding constraints limit the number of scholarships available, the foundation has supported more than 1,200 students since 1997. The company remains committed to high standards of governance and has reporting obligation to the Australian Securities Exchange. A statement on compliance with the ASX Corporate Governance Principles and Recommendations is contained in the annual report.
The company has also developed and complies with comprehensive set of charter and policies which are available on the website. The company takes the health and safety of its workforce very seriously, and achieving zero harm remains our priority. It is essential that work is only undertaken when deemed safe to do so. We employ a suite of health and safety procedures to address operational risks and remain committed to the ongoing training of our staff and contractors, particularly as activities on the ground increases. The past year has been one of significant transition for the company. We have navigated changes in shareholding and leadership while continuing to meet our exploration licence obligations and other undertakings. Looking ahead. Our future role in the redevelopment of Panguna will continue to be influenced by the decision of the ABG in its capacity as both the mining regulator and the major shareholder.
We remain focused on progressing exploration activities responsibly and in the best interest of our shareholders and the people of Bougainville. I thank the shareholders, my fellow directors, and the staff for their continuing support and perseverance. We now turn to the formal business of this meeting. There are certain legal requirements concerning the conduct of the annual general meetings. One of these is that the only business which can be conducted is business for which notice has been given. Proxies. I will declare at this stage that 299,556,282 proxies are held or 74.7%. As per the notice of meeting, there are four items of ordinary business to be dealt with. Item number one, receive and consider the balance sheet of the company as at 31st December 2024, and a statement of comprehensive income of the company for the year, and the directors' and auditors' report.
The company's annual report, which contains the financial statements and reports for 2025 are on the company website. I hope all members have had an opportunity to consider this. I therefore tabled the balance sheet of the company as at 31st December 2025, and a statement of comprehensive income for the year ended on that date, the director's report and the report of the auditors for the same period. I will now respond to members' questions in regard to the 2025 accounts and other matters referred to in the annual report. As the accounts and reports cover the whole span of the company's activities, any general questions you may have concerning the company's activities should be asked now. We have KPMG, the company's auditors, here at the meeting to assist in answering any questions.
Mr. Chairman, if I have just a question from Roger Blewitt in relation to some of those comments in your Chairman's speech. With the non-binding agreement with Lloyds, are there any key milestones in the 90-day diligence of Panguna Mine? How is BCL engaging with the people of Bougainville and their owners to ensure free and prior informed consent for any future sale or mining restart potentially involving Lloyds Metals? You did cover some of that, but maybe just if you could.
Yes. Thank you. There was a cooperation agreement, a non-binding cooperation agreement that was signed with Lloyds Metals, which looks at Lloyds Metals undertaking due diligence over EL01 Panguna Mine. Currently, that work is continuing, and we are within that 90 days period exclusivity. There is also the question on the environmental—
Sorry. With the continuing role of Rio Tinto, what role will they play in remediating environmental impacts and managing ongoing risks from the legacy operations in Panguna?
The Panguna Mine Legacy Impact Assessment that was conducted by Tetra Tech provides the plans for which the environmental remedial actions should be taken and ABG, BCL, and Rio Tinto, we are part of membership in overseeing the remedial actions of the Legacy Impact Assessment. Yeah, currently there's a program, and Rio Tinto is committed in ensuring that environmental remedial actions are undertaken as per the recommendations in the Panguna Mine Legacy Impact Assessment Report. The next item on the agenda is item number two. Resolution one, the election of directors. Director Maryanne Hasola retires in accordance with the provisions of the constitution of the company and is being eligible, offers herself to re-election. I would now like to move that Maryanne Hasola be elected as a director of the company. I ask that this motion be seconded.
Second.
Thank you. Appointment of auditors. The next item for business is item number three, resolution two, the appointment of auditors and authorizes the directors to fix their fees. KPMG has indicated to the board their intention to resign as BCL directors. Pending formal notification, the directors will commence the process of securing a replacement auditor. Once the company has received formal notice of the resignation and identified a replacement auditor, the company will seek shareholder approval at an extraordinary meeting. I would now like to move that the directors be authorized to appoint an auditor and set their remuneration. I ask that this motion be seconded. Thank you. Other business. The next item on the notice of this meeting is item number four, any other business. No notice of any other business has been received. Ladies and gentlemen, that concludes our discussion on the items of business.
In a couple of minutes, I will close the voting system. Please ensure that you have cast your vote on all resolutions. I will now pause to allow you time to finalize these votes. Voting is now closed. The result of these votes will be released to the stock exchange later today. Thank you.