Good morning, and welcome to MMG's 2021 annual results briefing. Presenting today are MMG Interim CEO, Li Liangang, and CFO Ross Carroll. The slides for today's presentation are being webcast in both English and Chinese. They can also be accessed from the investor and media section of the MMG website. I will shortly hand over to Liangang and Ross to take you through today's presentation, at the end of which we will open the line up for questions. For those wishing to ask questions, please ensure you are accessing this presentation via the teleconference details that were included in the invitation, and not just the webcast. I will now hand over to Liangang.
Yeah, thank you. Good morning, everyone, and welcome to MMG's 2021 annual results briefing. As you know that since early January, I've taken on the role of interim CEO of the company following Geoffrey Gao's resignation to take up a role with our major shareholder, China Minmetals Corporation. I'm more than happy to take this role and lead MMG as the interim CEO, and I'm grateful to have Geoffrey Gao and our former Chairman, Mr. Wenqing Guo, for having handed over a business in very good health with a solid platform for growth. We are very pleased to have Jerry Jiao back in the role of Chairman of MMG, and many of our investors will be very familiar with Jerry and his long-term contribution to the company of MMG. Now I will provide a brief overview of some of the highlights from 2021.
I will shortly hand over to Ross to discuss the financial results in more detail. I'm pleased to report that 2021 was a successful period of time for MMG, both operationally and financially due to the commitment and tireless efforts from all our people. We generated a record net profit after tax to equity holders of $667 million, and perhaps most significantly, a $2 billion reduction in our debt levels. In 2021, MMG's production was around 540,000 tons on a copper equivalent basis. We continues to deliver strong operational performance despite facing considerable challenges, including community disruptions at Las Bambas and also ongoing management of this COVID-19 pandemic.
Regarding our safety and ESG indicators, we reduced our total recordable injury frequency by 21%, but we cannot rest in our pursuit of zero injuries. As a major supplier of metals linked to a low carbon future, we will shortly be launching our climate resilience strategy, which targets a 40% reduction in emission by 2030 and net zero by 2050. Consistent with our commitment to mining for progress, in 2021, we invested $33 million in the economic and social development of our host communities. Looking beyond 2021, we are very pleased today to be able to welcome MMG board approval for the Kinsevere expansion project and the Peruvian government's regulatory approval for the Chalcobamba development at Las Bambas.
These projects will deliver additional copper equivalent production for more than 150,000 tons per annum by 2025 compared. This is around 28% higher than 2021 production levels. Finally, the rapid debt reduction in 2021 has given us the balance sheet needed to fund these development opportunities and also to pursue disciplined growth. Our portfolio of future Cu-focused commodities, including copper, zinc, and cobalt, are at the core of the world's transition to a low carbon economy, and we are very positive on their future. Now moving on to our ESG approach and safety performance in detail. As a member of ICMM and through our commitments to global sustainability-related initiatives, MMG remains committed to delivering sustainable development. Our greatest commitment is to the health and safety of our people.
Our operations recorded a total recordable injury frequency rate of 1.09 for the full year of 2021. While this injury rate ranks below many of our peers, we are consistently pushing to eliminate all injuries from our workplace. We also continue to improve dam safety, where we are working through compliance to the new global tailings standard. Turning to our environmental and social performance. In 2021, we committed ourselves, along with the ICMM membership, to a net zero emissions target by 2050. Consistent with this, we have adopted a comprehensive climate resilience strategy to guide us on the journey with an interim target of a 40% reduction in emissions by 2030. Details will be included in our soon-to-be-published 2021 sustainability report.
To combat the spread of COVID-19, MMG conducted COVID-19 prevention, hygiene, and vaccination programs to protect our employees, their families, and also our host communities. These measures have ensured that we have endured only limited impacts to production due to COVID-19 over the past two years. As you are aware, we continued to face real challenges around inbound and outbound logistics at Las Bambas. Our commitment is to work through these challenges by engagement and dialogue and look to build enduring agreements and deliver long-term development. We are not alone facing these challenges in the country of Peru, but our direct exposure to all the communities makes those challenges very difficult for us. Our teams are working hard to evolve our strategies to work closely with communities and local, regional, and national governments in the country of Peru.
The welcome approval of the Chalcobamba East development is another opportunity to work together with the communities to build shared benefits. This community challenge is clear on this slide eight. It provides some greater context on the Las Bambas logistics chain subject to over 100 days of blockades, again, in 2021. There are a few key points to highlight. The first relates to the map on the right side of the page, which shows the southern road corridor used to transport Las Bambas concentrate. This illustrates a point that we have made before. The Las Bambas road logistics system length is 438 km and passes through over 70 communities, making this a complex situation. Since 2016, transport loss related to Las Bambas operations has reached almost 380 days.
While we have become very capable at minimizing impact on site operations and production volumes, the key impact has been on the restriction on the sale of finished products or finished goods or copper concentrates. From 2021, we are evolving our approach to focus more directly on joint solutions with governments and community business that focus on shared commitments to development. Whether that be transport service and road maintenance contracts or joint infrastructure development, the intent is to further integrate communities into our value chain of the region. We are also looking to structure benefits differently to extend payments over time and incentives, active involvement rather than passive one-off compensation. All of this takes time, and I'm particularly concerned that we continue to conduct these negotiations in peace.
We have seen what happens when conflict escalates, and for some years now we have emphasized dialogue and patience. This has costs, but the only enduring solutions are peaceful ones. As at 22nd March 2022, inventory at the mine site was approximately 70,000 tons of copper and concentrate. We expect this stockpile to be drawn down over the second half of this year. We are working hard to avoid further pronounced disruptions over this period. I will now hand over to Ross to take you through the 2021 financial results in detail. Ross, over to you please.
Thanks, Liangang, and welcome to everyone who's on the line with us today. As Liangang has flagged, 2021 was a strong year financially. I'm very pleased that we are able to report record profitability despite the many challenges we encountered. Moving on to the numbers. Our revenue increased by 40% or $1.2 billion due to higher copper and zinc prices. This, combined with strong cost control, resulted in profit after tax of $921 million, including $667 million attributable to MMG shareholders. The residual profit to minorities reflects the 37.5% of Las Bambas that is owned by our joint venture partners. This slide sets out the EBITDA bridge between 2020 and 2021.
As already mentioned, drivers of the stronger performance are higher prices, operating cost control, and strong production at our Australian mines. To summarize, copper and zinc prices were 40% and 56% higher respectively in 2021, with copper adding $1.2 billion to the revenue uplift and zinc adding around $200 million. Total operating expenses were $162 million higher than 2020. We had higher employee incentive costs of $66 million, mainly driven by employee profit-sharing arrangements in Peru, and higher royalties across the group of $39 million due to the higher commodity prices. Operating costs at Las Bambas were also impacted by increased spending on health, security, and community programs to the amount of $29 million, higher maintenance costs and consumables usage of $35 million. At the Australian operations, costs were increased by the stronger US dollar by $27 million.
These cost increase were offset by lower mining costs at Kinsevere of $43 million, following the suspension of mining activities in the fourth quarter of 2020. Offsetting the increase in operating expenses was a favorable stock movement, mainly at Las Bambas of around $156 million due to a buildup of concentrate at the LB site due to roadblocks at the back end of the year. The other positive contributor to the result was the increase in other income of $123.6 million, due to the gain recognized on the reduction in the Century bank guarantee. Apart from being an add to a profit, this transaction was pleasing because it relieved us of any potential liabilities at the restarted Century Mine. Now to slide 12, which gives an update on our debt profile.
We have consistently reduced our overall debt levels since developing Las Bambas and Dugald River in quick succession. This reduction accelerated by $2 billion in 2021, driven by strong cash flows generated by the group as a result of strong commodity prices and the $300 million equity raise that we conducted in June. The transaction was very well supported by new and existing long-term global investors, and the funds will be used for MMG's next stage of disciplined growth. The right side of the chart sets out our updated term debt repayment profile. What is important to note here is that we have very strong relationships with our funding partners, being our syndicate of Chinese banks, as well as our major shareholder, China Minmetals. These partners remain very supportive and flexible in their approach to funding MMG and helping us to grow.
Now to slide 13, which is an update on our capital expenditure outlook. Our 2021 capital expenditure of $570 million was below the revised guidance range of $600 million -$650 million. The lower spend was due to the delay in the approval of the Kinsevere expansion project and regulatory approval delays with Chalcobamba. However, with the approval of the Kinsevere expansion and the Chalcobamba projects, we expect to ramp up our capital expenditure in order to drive further returns to shareholders. Our plan for 2022 CapEx is now $700 million-$800 million, of which approximately $400 million-$500 million is attributable to Las Bambas, including around $70 million at Chalcobamba and a further $180 million-$200 million for the Kinsevere expansion project.
With the ongoing development of these two projects, CapEx is expected to peak in 2023 and 2024 at around $850 million. Despite the uplift in spending, the chart on the right-hand side of this page demonstrates the capital efficiency of both these projects and why we expect they will deliver significant value for our shareholders. What this chart shows is that for all greenfield copper development projects that took place between 2010 and 2020, the average cost per ton of yearly production was around $15,000. More recently, copper assets have been changing hands via M&A transactions at around $18,000 per ton of production. If you look at listed global copper companies, they are currently trading at an average of around $23,000 per ton.
To acquire new copper production, you're probably going to have to pay well in excess of $15,000 per ton. Contrasting that to the cost to deliver incremental production from our Kinsevere and Las Bambas assets, the capital intensity is around $7,000 and $10,000 per ton, respectively. The next slide gives our investors an indication of our pure earnings leverage to changes in copper and zinc prices. In 2021, MMG generated very healthy $1.7 billion of free cash flow. As you can see from the red column, despite the higher CapEx profile and tax payments forecast in 2022, we would still expect to deliver around $1.2 billion of free cash flow again in the current commodity price environment.
I will now quickly run through a few of the key points in relation to the four operating sites. Firstly, the Las Bambas. In 2021, LB's production was impacted by lower average feed grades and community roadblocks. This resulted in a 7% reduction in copper production from 2020. EBITDA was 83% higher due to higher copper prices and increased moly sales volumes. C1 costs were stable at $1.02 per pound. The stable C1 was a function of the deferral of planned project spending, diligent cost management, and higher product credits. This offset the cost pressures we were encountering due to lower grades, higher social costs, and higher consumable prices.
Looking forward, we are very pleased to confirm that the Peruvian Ministry of Energy and Mines has announced a regulatory approval for the development of the Chalcobamba pit and associated infrastructure. We will now continue to take the next steps with the local Huancuire community to advance the development of this deposit. The significant stripping activity planned to take place towards the end of the first half , with first production planned for the third quarter of 2022. Following the approval of Chalcobamba, MMG's full-year guidance for copper production remains at 300,000 tons-320,000 tons for 2022. As previously disclosed to the market in our fourth quarter production report, C1 costs are expected to increase to $1.30-$1.40 a pound due to a number of one-off factors and inflationary cost pressures.
These include increased material movement, longer haul distances, higher consumable usage, increased spend on social and development programs, as well as higher energy prices, contractor rates, and consumable prices increases that have been seen across the industry. We are also forecasting a lower contribution from byproduct credits in 2022, although this will be dependent on market prices for moly, gold, and silver. For the medium term, the Chalcobamba development is expected to underpin a production increase at Las Bambas to around 380,000 tons-400,000 tons of copper and concentrate per annum, with a higher production partially offsetting some of these cost pressures I've just discussed. Moving to Kinsevere, where copper cathode production fell by 33% compared to 2020 due to the suspension of mining and the subsequent processing of lower grade stockpiles and third-party ores during the year.
However, higher copper prices, stable plant performance, and lower operating costs result in EBITDA of $138 million, an increase of 102% compared with 2020. Looking forward, following board approval for the expansion project, mining activity will now resume during the second quarter. The expansion project will extend Kinsevere's life by 13 years and take annual production up to more than 100,000 tons of copper equivalent production. For 2022, MMG's full-year guidance for copper production at Kinsevere is unchanged at 45,000 tons-50,000 tons.
C1 cost guidance is temporarily higher than 2021 levels at $250-$280 per pound due to the resumption of mining activity during the year and ahead of the significant benefits will be driven by the higher production and higher cobalt byproduct credits arising from the Kinsevere expansion project. At Dugald River, operational performance continues to be strong with another record year of 180,000 tons of zinc and over 200,000 tons of zinc equivalent. EBITDA of $213 million was 113% higher than 2020. Lower treatment charges as well as higher production volumes also reduced C1 costs to $0.67 per pound.
In 2022, Dugald River is expected to produce between 170,000 tons and 190,000 tons of zinc and zinc concentrate, with C1 costs in the range of $0.70-$0.80 per pound. It's also important to mention that Dugald River has entered into a long-term energy agreement powered by solar with the APA Group. This will help reduce our carbon footprint and provide cost savings from 2023. We'll also continue to study initial renewable energy solutions such as wind turbines, and we'll keep the market updated as we progress these sustainability initiatives. Finally, moving on to Rosebery.
Despite the age and depth of the mine, Rosebery produced over 69,000 tons of zinc during 2021 and 157,000 tons in zinc equivalent terms, which includes lead, copper, gold, and silver byproducts. This was 11% higher than 2020, with byproducts contributing more than 50% of the revenue in the period. This really shows the benefit of the polymetallic nature of the mine. EBITDA of $203 million was a 50% increase, 56% increase on 2020. C1 costs for 2021 benefited from the material contribution from the precious metal byproduct credits coming in it at a negative $0.34 per pound, making Rosebery a highly cash generative operation. We remain fully committed to extending the life of Rosebery further.
Resource extension drilling is yielding encouraging results, and work continues to find additional tailings management solutions. Zinc production for 2022 is expected to be between 55,000 tons and 65,000 tons with a C1 cost of $0-$0.15 per pound. This guidance range reflects longer-term grading declines, lower byproduct credits, and higher costs associated with operating at depth, as well as increasing energy costs. I'll now hand you back to Li Liangang to wrap up the presentation. Thank you.
Yeah, thank you, Ross. Now we move on to MMG's strategy and outlook. I want to quickly touch on the two exciting development products that we have announced today. This week is a very significant milestone, being able to announce a record profit as well as the approvals for Chalcobamba and the Kinsevere expansion project or KEP. These projects follow a difficult two-year period that has been our business impacted by COVID, political instability, regulatory delays, and community disruptions. The Kinsevere expansion plan or KEP and Chalcobamba development will drive nearly 30% production growth over the coming years and very reasonable CapEx. KEP will deliver an additional 750,000 tons of copper and 48,000 tons of cobalt during the current lives of mine out to 2035.
It involves the mining and processing of copper sulfide and cobalt ores at Kinsevere, and will include the installation of floating plant, roaster system, and cobalt processing circuit. The total capital cost of this project is expected to be between $550 million-$600 million. Will be funded via available cash reserves and debt facilities. KEP's first cobalt is expected in 2023, and first copper cathode from sulfide by 2024, and full ramp-up from 2025. Once fully ramped up since 2025, annual copper equivalent production will exceed 100,000 tons per annum, including 80,000 tons of copper and 4,000 tons-6,000 tons of cobalt. This will make the Kinsevere operation one of the largest producers of cobalt in the world.
Regarding Chalcobamba, following the final regulatory approval from the Peruvian Ministry of Energy and Mines, the operation will now be developed by open-pit mining with associated waste dumps to be commissioned progressively over the next five months. Ore will be transported by haul truck for approximately 13 kilometers to the existing crushing and conveying plant located near the Ferrobamba pit. The Chalcobamba development will underpin a copper production increase to around 380,000 tons-400,000 tons per annum for the medium term. Again, making Las Bambas a world top ten producing copper mine. We look forward to working with the nearby community of Huancuire to drive benefits from this important development.
These growth projects discussed on the previous slide come at an important time for MMG and are delivering the commodities that are essential to the world's transition to a low carbon economy. We intend to leverage this mega-trend with a portfolio positioned to outperform over the upcoming decade, and we will continue to focus our growth plans on these critical minerals. We believe this is a secular shift in demand for these metals. The period from now to 2050 will be dominated by the shift from non-renewable high carbon energy to renewable low and no emission technologies. As a result, it will be metal intensive. Whether in the shift to electric vehicles, the development of static storage to smooth the peaks and troughs of wind and solar generation or the shift to renewable supply chains for materials, base metals will be in high demand.
The other side of this is how difficult it is to discover and develop new resources. While the circular economy will increase the contribution of recycled metals, significant new supply is required. That supply takes longer to permit and build, is typically low grade and more energy intensive, and faces the ongoing challenges of social, labor, and geotech, geopolitical constraints. That is particularly so for cobalt, which we will add to the portfolio in 2023. Cobalt's unique properties in temperature control in batteries makes it critical for battery development. While new supply is hard to find, I'm very happy we will welcome cobalt to the portfolio of the company. In closing, let me reaffirm that MMG's vision is to build the world's most respected mining company. I am proud of the contribution from our hardworking teams during these challenging times.
On behalf of the MMG management team, I thank our shareholders, host communities, contractors, and all MMG employees for their support. Thank you for your time today. I will now hand over to the moderator who will open the line to questions.
Your first question comes from Jack Shang from Citi. Please go ahead.
Good morning. Thank you, Liangang Li and Gang Dong. Thank you, Ross. Thank you, Brent. This is Jack Shang from Citi. First of all, congrats for the great results last year despite all these difficulties and roadblocks. A great job done last year. Congrats to that. I have a couple follow-ups. Regarding the first one is on Las Bambas. Again, congrats on Chalcobamba approval. I noticed that there is no change in production volume guidance for the year despite this approval. Maybe more details on the, say, construction and the ramp-up forecast for Chalcobamba pit contribution.
What could be the range of production if Chalcobamba really ramps up next year? Shall we put Las Bambas production in 2023 back to 400,000 tons? The first one on Chalcobamba. The second one is on Kinsevere. Kinsevere, we noticed that there's an update on the reserve report, b ut the resource numbers largely stay the same. Can you just give us more information about the process of redefining or just increase the ore reserve and the methodology behind that with the overall resource base with no changes? Do you have further potential upside to further increase the ore reserves going forward on Kinsevere?
The third question is regarding the logistic issues. More in general, not only in Peru, but Peru, of course. More production with the Chalcobamba pit addition to the existing mining capacity means that more trucks on the road. What is the road capacity? Assuming there's no roadblock, what can be expected to be trucked out of Las Bambas each year? Does it require us to further invest on the road capacity or the truck fleet? What are the options since Chalcobamba now has a green light? Do we need to work on, say, potential plans for pipeline construction or even rail?
I think it was discussed, you know, in the past couple of years on the logistics solutions, more permanent logistics solutions in Peru. Also a follow-up on the Congo situation on DRC situation. We noticed that a couple of companies had produced copper but not been able to really bring copper out of the region in Africa. So what is the company seeing on the ground in DRC? What are the key bottlenecks there in terms of logistics issues in Africa? My last question is regarding the C1 cost guidance for Las Bambas and Kinsevere. Are these increases predominantly on diesel?
I mean, the variance, the changes of 2022 versus 2021 were that mostly on diesel and say the fueling input costs? Thanks.
Well, thanks, Jack. It's Ross. Thanks for those questions. First, in regard to Chalcobamba, it was already included in our guidance of 300-320 for the year. We expect to have a sort of a modest input this year because the production will start off slowly using small trucks until we get the mine set up. In 2023 and 2024, we do expect production to return to sort of between 380,000 tons-400,000 tons, and that is largely on the back of the Chalcobamba contribution. Is that sort of reasonably clear?
Yep.
Um.
Thank you.
Yep. Your second question about Kinsevere is the reason why the total resource hasn't moved much at all was we've actually just moved really from resource to reserves. So the overall base is the same. It's just a different classification now that we've got the ability to exploit those resources. So overall, there's no real change. There's nothing new in there. It's just a reclassification from resource to reserves. Yeah. Now on to logistics issues. In Peru, you know, we have produced at 400,000 tons plus in the past. So the inclusion of Chalcobamba, which would, you know, hopefully get us up into that region next year, doesn't mean that there's any additional or any new requirements on the road, b ut, you know, as you've seen, we sort of continue to get blocked.
The biggest challenge with logistics is not the infrastructure or the capacity, it's the ability to continue using the road on a sort of an uninterrupted basis. Yeah, there's certainly enough capacity there. It's more just the disruption that would potentially cause us issues. With the pipeline, we have started a pre-feasibility study or scoping study on that. The pipeline wouldn't be an immediate solution because it would, you know, once we've done all the engineering approvals, it would probably take us five years to get land access, and then maybe another two or three years to build the pipeline. You're talking, you know, even if everything fell into place tomorrow, it'd be probably the end of the decade before we saw anything coming from that.
The other issue with that is it would then take away a lot of business for people down the haul road. While they probably, the people along the haul road don't appreciate the impact of trucks, in some ways, it brings a lot of business into those towns. It's a bit of a double-edged sword that we're fighting there that, in some ways they don't want the trucks, but in other ways, they want the business. Yeah, the pipeline's sort of a short answer. With the rail, you know, that's been talked about. You know, if anyone's seen the topography up there, it's. You're talking about 15,000 ft.
It'd be like running a new railway line through the Swiss Alps, and that's just not gonna be economic to, you know, put basically 1 million tons of concentrate down a railway line. For that to occur, it would need government involvement. Now as far as Kinsevere and logistics, we don't have any issue there at all. We sell all our product at the mine gate to Trafigura, so it sort of becomes their issue at the mine gate. As far as I'm aware, they haven't had any issues either. Yeah, so really, Kinsevere and the DRC for us is business as usual. Then finally with the C1 cost, there's a heap of factors contributing to the increase in C1.
I mean, with COVID, we've had some additional costs with COVID, but it's also stopped us doing a lot of things both in the community, and this is Las Bambas I'm talking about, in the community and our development program. We are seeing cost increases with diesel, but also all our other consumables. We also, this year, will have our, every sort of three-year, EBA negotiation. When that negotiation is resolved, we have to pay a bonus to the staff. That's sort of a common or is the way things work in Peru. We've got less deferred stripping. We've got longer hauls with Chalcobamba. With Chalcobamba, using smaller trucks to start with, that is more expensive than using the bigger trucks.
There's a wide variety of reasons for the increase in C1 at LB. Now, if we get the production back up to, you know, 400,000 tons or thereabout next year, we would expect that C1 cost to come down, not to $1.02, but, you know, maybe somewhere around $1.15 or $1.20, a nd then at Kinsevere, the reason why the costs are higher there is that we plan on starting mining again, but we're still running at low volumes because not that the plant's running at low volume, but we've been putting low grades through the plant. We've essentially got full operating costs, but still only getting 50,000 tons a year of production.
If you compare that to two or three years ago, we were at 80,000 tons or a bit more. This is a transitional year for Kinsevere. In 2023, we'll see slightly higher copper production, but also cobalt production, which will provide the by-product credits to the Kinsevere C1 cost. Hope that's answered your question.
Thank you, Ross. Yeah. Thanks. That's very clear.
Thank you. Once again, if you'd like to ask a question, please press star one on your telephone and wait for your name to be announced. Your next question comes from Chris Shiu from Balyasny Asset Management . Please go ahead.
Hi. Thank you very much, Mr. Li and Mr. Carroll. I've got three questions. Starting with the first one, congratulations on the results, and especially on the approvals of the two new growth projects. I would like to understand more about your longer-term strategy, because the company has the target of, you know, double and double to reach, you know, 2 million tons of copper equivalents by 2030. These two projects, while they are good, they will not be enough to meet that very ambitious target. My first question is, what is the strategy to drive the production towards that longer-term target? That's the first one. Thank you.
Chris, really the strategy to get to that higher production levels is trying to optimize everything we can out of the existing operations. Basically with Kinsevere, it'll go to 100,000 tons of copper equivalent. Rosebery will stay at similar levels to where it is now. At Dugald River, we've had some pretty good exploration, initial discoveries with zinc and also some copper. At Las Bambas, you know, obviously we'd like to get more than 400,000 tons out of that mine. That'll be a matter of prosecuting the exploration targets in the area. Obviously that'll be dependent on community and land access as well. It's really part of it about optimizing the existing portfolio.
The second part is that we, you know, we'll need to be active in the M&A market. The M&A team's been very busy, and we came close on a couple of things last year. We'll, you know, definitely be approaching the M&A market fairly aggressively, but at the same time, staying disciplined.
Got it. Understood. In terms of the types of metals that you would consider and also regarding the region, I mean, is there any emphasis or any sort of restriction?
No. Well, I think yeah, the strategy. Sorry, I'm cutting in on Liangang here. The strategy is still largely copper and zinc. You know, hopefully cobalt will come with copper and, you know, give valuable by-product credits. We'd also look at nickel for the right opportunity, but finding the right nickel opportunity is very difficult. That's basically the product mix. Then geographically, it's really where we are now. It's Africa, Latin America, and Australia. Australia being such a mature environment, it's hard to grow in. Probably the growth is more likely to come from Africa and in Latin America. You know, previously, we've looked at Chile and Peru, you know, pretty much in isolation.
You know, we may look at spreading our wings a bit further in Latin America as well.
Got it. How about the Izok projects, right? Given that zinc prices have gone up a lot, is there any, you know, breakthrough in terms of the infrastructure there?
No, unfortunately there's not any breakthrough with the infrastructure, Chris. That, you know, I think the local indigenous body was, with Canadian government support, looking at developing the road. If anything, that's had a couple of setbacks. Yeah, at this point, there's nothing really happening there. Obviously for us, we can't afford to spend all that money on the infrastructure that our mine alone doesn't pay for it. Yeah, unfortunately, there's no real update on that.
Got it. The second question is regarding capital management. If we look at our major mining peers in China, for example, Zijin Mining, China Molybdenum, Jiangxi Copper, et cetera, many of them have actually got, you know, dual listing. You know, not just Hong Kong, but also in the Asia market, and that gives them an advantage in terms of the lower funding costs, right? Is there any particular reason why MMG has so far not been pursuing that funding source?
No. I think from our perspective, Chris, we're very comfortable with how we can fund the business and getting low funding costs. That's, yeah, to be honest, that's the least of our worries. You know, our Chinese banking partners and our major shareholders have always been incredibly supportive. The real challenge for us is more so finding the right assets to buy. We've, you know, any sort of new funding we get is always very cost competitive, and it comes with its restrictions. We don't need to sort of add an additional listing to access that funding.
Got it. Last question. On the other hand, how about the future dividend outlook? Because the company has suspended dividends since 2014, right? Given that the company has deleveraged a lot and the free cash flow generation is very strong, you know, what is the timeline for that? Or if you can give us some, you know, preconditions for dividends, right? I mean, you know, what sort of gearing ratio and then, you know, what sort of payouts percentage in terms of free cash flow or maybe earnings. That would be very helpful for us to evaluate. Thank you.
Chris, the debt slide in the pack, which shows that we still have, you know, I think about $600 million of debt repayments this year. The next three years, we've basically got significant payments to the major shareholder and also the Chinese banking syndicate. There's sort of over the next four years still, you know, in excess of $4 billion of debt to be repaid. We have to sort of bear that in mind. We also at the moment, I think most people are aware of this, have some issues with cash being sort of trapped in the Las Bambas JV, and that's sort of as a result of our banking arrangements.
We really need to start being able to get some of that cash out of the Las Bambas JV and then using it to help pay the shareholder debt. We're probably not in a position to give clear guidance just yet, but I think over the next six or 12 months, we'll be able to come out with a clear policy and what we're looking to do with dividends.
Got it. Thank you very much. These are my questions. Thank you.
Thanks.
Thank you. There are no further questions at this time. I'll now hand it back to Mr. Li for closing remarks.
Yeah. Thank you very much again. I think that I would like to take this opportunity to say thank you again to all the investors and all the partners that working with MMG during the past years. We are looking forward to the continuous support in the coming future.