Good afternoon and good morning, ladies and gentlemen. Thank you for joining us at very short notice to discuss the transaction that was announced this morning. With us today, we have Chris Griffith, Gold Fields CEO, and Peter Marrone, Executive Chairman for Yamana Gold. I will hand over to Chris now, and then we'll have an opportunity for questions after the presentation is done. Thank you. Chris.
Thanks for that introduction, Avishkar. Hi, Peter, and to all of you, ladies and gents, that are on the call, good day to you all. As always, we draw your attention in this case to the most significant disclaimer pages that you've ever seen. There's three pages of disclaimers. Please note those, given the context of this presentation today, a very important disclaimer. I guess the question is, why this deal? We are extremely excited to be announcing today the acquisition of Yamana Gold, and we think this is truly a transaction that delivers on our strategic important and strategic initiatives, for the future of this company. But it also delivers significant long-term value creation for shareholders. In line with the strategy of Gold Fields, we have done extensive work, building on our previous strategy.
The team in Gold Fields has done a lot of work with the support of the board, engaged in an extensive review since the end of last year, and looked at a range of opportunities that deliver the strategic imperatives that we were looking for this company, which is to grow one of the strategy legs to grow the value and quality of our portfolio. We have followed a strict evaluation criteria and a rigorous process to come up with the opportunities that we wanna pursue and thereby have identified Yamana as what we think is a unique opportunity for Gold Fields. In Yamana, Gold Fields will acquire a high-quality portfolio of assets that will continue to deliver and grow the business and the capital returns from the company.
We get a world-class asset portfolio, including Canadian Malartic and Jacobina. We'll have an increased diversity of exposure across premier gold regions, including an enhanced access into North America, with Canadian Malartic in Canada on competitive economics. We get as part of the portfolio of assets a deep project pipeline, providing excellent opportunities, and optionality for the future. One of the great things about the combination of these companies is we think that there is a cultural alignment seldom seen between the combination of two companies, including shared focus on delivery, a track record of delivery on production, growth, and ESG priorities.
We think that there's significant value potential within the combined business that we've identified through detailed due diligence all the way from the initial engagements, management presentations, the data room, but also including detailed site visits and complementary site visits between the management teams of both companies. This transaction certainly positions Gold Fields at the forefront of the gold sector and will result in a unique investment opportunity for our stakeholders. What I'm gonna be doing over the next number of slides is expanding a little bit on this introduction. This slide, those of you who follow Gold Fields, will have seen this slide before. This is the summary of the purpose, our vision, our values, and our strategy that we announced to the market at the end of last year.
This was building on the previous strategy that the company had, in our view, successfully delivered. I'm gonna point you to, in that circle in the middle, the bottom, green component where you see strategy pillar three, because this presentation addresses that element of the strategy, which talks to growing the value and the quality of our portfolio of assets. You can see from what comes is that this is entirely focused on the strategy and the delivering the next potential phase of the company strategy. I mentioned that we have followed a very diligent process to look at the opportunities. First of all, taking into account what the market regularly gives us feedback for and what drives value.
On the two on the right-hand side, you can see that the market regularly gives us feedback to say that unless you have the right quality of assets, life of mine and all-in sustaining cost and a number of other metrics, but also geographic or jurisdictional quality. Unless you have quality assets, it doesn't really matter what comes after that is you're never gonna get premium value. Of course, for management, making sure that we deliver on what we say we're gonna deliver and delivering on our strategy so that people believe if they put money behind us, that they'll get the returns that we promise.
Making sure we've got the right balance sheet, that we don't put the company at risk. That we have the right discipline in our financial allocation of capital and that we generate shareholder returns. The market's telling us this. What the market's also saying is size and scale is of itself not a premium driver. Certainly that's not been the focus, although the outcome which we'll speak about later, is that this is a greater scale company. It certainly wasn't the driving force of this deal. I think the next slide on the left-hand side shows the criteria that we have used to evaluate the external opportunity set.
We look at the opportunities, we look at these 6 points on the left-hand side and say whatever we do and whatever we're looking at must improve the business on these metrics. We're saying that if these things that we're looking at do not bring improved asset quality in terms of life of mine and sustaining costs or that we're not growing cash flows or if we're bringing assets to the table that don't improve our jurisdictional quality. Having spent all this time over the last 10 years, having a portfolio of assets in what we believe is very good jurisdictions, we don't wanna go and mess that up.
Whatever we do, we said in the strategy, given the Gold Fields portfolio, we grow production to 2024, but thereafter, as we get to 2.8 million ounces, our production profile starts dropping off as some of our mines come to the end of their life. It was this particular thing as we think for the future of the company, as we're thinking about the strategy of the company, making sure that whatever we do is enhancing the pipeline of this company. Then having a look at what we're good at. I mean, we're good, we believe, at running underground operations. We can run open pit operations. We have fixed up operations before, like the Australian assets, and we can build new mines.
What we're saying is whatever we do and whatever we buy must make sure that it can talk to our competitive advantage. Lastly, given all the work that Gold Fields has done over a number of years, what we don't wanna do is put together a portfolio that takes us backwards in our ESG commitments. What you see on the right-hand side is you see that Yamana pretty much ticks all of those boxes and ticks those boxes very comprehensively. As the work that Brett and his team and our and our executive team, as we've evaluated opportunities and we see what are the companies or what are the single asset opportunities that help tick all those boxes, we keep coming back to say that Yamana Gold is the best opportunity that we could see.
A bit later when I talk to you about the value that we can see in this company, we believe is substantially higher than the value that we are paying for these assets. This is what you're gonna see. When we put these two companies together, this is just a summary of some of the metrics that you can see, when we initially put these two together. As we go through the presentation, you'll see that some of the that these metrics will continue to improve. On the left-hand side at the top, you see we put the two companies together. We'll have a pro forma production for 2021 of 3.4 million ounces. That grows over the next number of years to 3.8 million ounces.
At the bottom left-hand side, you can see what the growth rate over the next three years is. The Gold Fields, the two companies put together, there's a growth rate over the next number of years of 7.4%, a reserve life with over 3.8 million ounces of 25 years. All-in sustaining costs by putting together the Yamana assets with the Gold Fields assets actually our all-in sustaining cost reduces. Of course, as we put the two combined portfolios together, there remains opportunities to be able to continue improving that all-in sustaining cost. Absolutely you can see from this particular graph that it meets one of the strategic criteria of saying that if we put things together, we must be reducing our cost.
These two companies will produce a free cash flow yield of 5.2%. At the bottom box, on the right-hand side, you can see these two companies will have a market cap when we put them together of $16 billion. Because of the metrics that you're seeing on the left-hand side with a huge potential to re-rate, if you compare how we fare versus the other, major gold companies, and when you look at the market cap, we believe that there's huge potential for a re-rate of the share. Importantly, though, this deal has not been done on the premise that there will be a re-rate of the shares.
What you can see from this slide is the inevitable conclusion that we think there that that is an outcome of putting these two companies together. This is another way of looking at that message. If you look at a number of metrics, P/NAV, EV/EBITDA, and price to cash flow, you can see and compare based on the metrics I showed you what the potential is for significant value creation in this company. The transaction structure, how we put this deal together. This is an all-share acquisition of Yamana by Gold Fields. Yamana shareholders will receive 0.6x a Gold Fields ordinary share or an ADS for every Yamana share held.
It offers on the 10-day VWAP a 33.8% premium versus the prices that you see on this slide. This will be executed via a plan of arrangement in Canada or a category one transaction for Gold Fields in South Africa. Gold Fields will continue to be a Gold Fields Limited and headquartered in South Africa, trading on the JSE with its primary listing and ADSs traded on the secondary listing in the New York Stock Exchange. Gold Fields will own 61% and Yamana shareholders 39% of the combined company. One of the things that I'll show you on the next slide is another way, although that was not how the deal was done, and which was done from the bottom up on a value basis.
I will show you on a number of metrics that sort of show that ratio feels right. We require shareholder approvals, as the size of this deal would indicate. Gold Fields requires 75% and Yamana Gold shareholders 66% approval. We expect to do this and have this complete in Q3 with the closing of the deal early in Q4 of this year. As you would expect, there are mutual deal protections with break fees of about 4.5% of the market caps of both companies, with the break fee for Yamana Gold $300 million, and Gold Fields $450 million, in addition to all the other protections that you would normally expect of a deal of this nature.
I mentioned to you that although the deal, and I'm gonna talk about the value that we can see and what we can see in addition to that. If you try to get a sense of what does this look like and feel like, and does a 61/39 split feel right? If you look at a number of metrics that you see on the left-hand side, whether it's reserves, resources, production in the next number of years, consensus NAV, or all-in sustaining cost. If you have a look at that, and you look at that red line that is the 61/39 split, you can see roughly that is where these various metrics between the two companies' contributions land.
I think what this does, this is another way of saying that this deal feels right at that split for the various two companies in the combined company. This is an important slide because it indicatively gives you a sense of the value that we can see. If we start on the left-hand side, you can see that Gold Fields market cap of $10.9 billion, the current Yamana market cap of just around $5 billion. You can see with the dotted box just below, just above that in blue, shows that the year's high has been as high as $6.2 billion. If you look at that in the market, the deal that we're doing today is equivalent to $6.7 billion.
What we're showing is we can see that value. That little box on the top side, we can see $6.7 billion for what we are paying. We think this is a very good deal for Yamana shareholders. For Gold shareholders as well, you can see on the boxes on the right-hand side, that we haven't had to push the boat out and put absolutely everything into the future. Some of the upside is what we're paying and some of the benefit, the future benefit, both in pipeline, in future project expansions we pay for. Some of that upside and a majority of that upside or significant upside above that, comes from value that we haven't used in our valuation. Another way to think about that is the 12-month target price for Yamana is $7 billion.
The market is seeing $7 billion. $6.7 billion is not out of line with what the market is seeing. The market's saying it will take some time to get there. For the Yamana shareholders, our view is that's an acceleration of value. Some of that value will be unlocked because of the combination of the two companies. In a much bigger company, you see the text under those gold boxes. Some of that, like Mara and the execution of that, which will happen in a much more likely to happen in a larger company, is where additional value will come from.
This is not to say to the Gold Fields, this is to say to the Gold Fields shareholders, both because of the delivery of Wasamac, Mara, future value coming from just unlocking, the ongoing unlocking of value from existing assets. On the very right-hand side, you see that we've got synergies that are not included in that value. This deal is not based on synergies. Yes, there is some synergy, and we haven't tried to push the boat out, and I'm gonna share with you how some of the synergies work. Actually, we see much more upside in synergy on upside production or upside efficiency by working together. There's near-term potential at some of these, at almost all of these mines that has not been included in the value of this company.
There's development projects like larger development projects that are longer term, say, for example, the second shaft at Canadian Malartic or phase IV at Jacobina, that forms part of that bucket of absolute value we can see but that has not been included in the valuation. Then a very significant exploration portfolio that comes with this deal. Yes, of course, we're paying for that. This is like an investment in a mine. You invest some money to expect greater returns later. Because today we've had a lot of questions about, is there short-term dilution?
Yeah, there is some short-term dilution as you pay a premium for investing in a much more significant value that comes with this combination of assets. And then the strap line at the bottom says, "Don't forget that if you, if we were not to do this deal, as we need to supplement our portfolio of assets in our pipeline, as we need to do that, of course, that we are going to invest and we're gonna have to put money into those assets." We had a discussion on one of the calls today where someone was saying to us, "Well, look, the value of our company per reserve ounce for Gold Fields is currently about $220 an ounce." The value of what we are buying at $6.7 billion for Yamana per reserve ounce is $208 an ounce.
If we have to go for that bottom strap line, the pipeline that we need to go invest in, if you're investing in single assets, good quality assets, that's gonna come at $350-$400 an ounce. It's just another way of helping us see that the value that we are paying for this asset, in our view, we are paying for some of the value that we see, and there's still potential upside with the combination of these. Well, there's definitely significant value upside still to come from this company. What does that look like? What does the new company look like? Now I'll speed up a bit, as we go through the presentation.
This truly looks like if you think about two puzzle pieces sitting alongside each other as opposed to two puzzle pieces sitting on top of each other. Yes, there's things that Gold Fields bring in the short term, and there's things that Yamana suite of assets bring in the longer term. In the overlap is both companies are very disciplined cash-generating assets. It's not like one only brings long-term benefit, one only brings short-term. These are well-established companies generating growth, generating cash returns, and returning cash to shareholders, but we add complementary portfolios to each other. I'm not gonna run through those, but for those who know Gold Fields will know that this is what we're bringing.
We're bringing very substantial growth in the short term and very substantial cash generation ability, very strong focus on ESG and a disciplined approach to growth, capital returns, shareholder returns. On the right-hand side, you can see what Yamana bring. A set of projects, near-term and medium-term pipeline, established operations. Three of those five assets we'd wanna go and buy tomorrow. So in their individual rights, these are great assets that we are putting in our portfolio. The geographic position of these companies is complementary to ours. A deep pipeline. I've got a slide in a couple of slides' time that'll give you a sense of how extensive that exploration portfolio is. But also a strong track record of cost-effective mining and on mining on assets that are actually quite complementary to Gold Fields.
Very importantly, right at the end, very similar approaches to ESG. This is what it looks like when you put these two companies together. Starting from the right-hand side, you can see Australia. That's our existing Australian footprint of about a million ounces. Working our way to the left, you can see Africa with 1.1 million ounces, and about 24% of the future NAV of this company. Having a look at the left-hand side, looking at North America. We have long wanted to get into Canada, and it's always been too expensive, and we found difficult to, on a standalone basis, to get into Canada so that it adds value to the company. Now we have one of the best mines in Canada.
We're in the 50/50 JV with Agnico, we get into one of the best mines in Canada with a near-term project in Wasamac, and a footprint to allow us to potentially grow in Canada. The most significant put together, which is why I left it for last, is in South America. If you look at, I mean, this will be about 40% of the company's NAV. If you look at Chile down the left-hand side, the El Peñón asset, again, one of the three assets that we would want to go and target, even if it is a standalone asset. El Peñón, very close and with plenty of synergies with Salares.
With our exploration potential and the exploration potential around those assets, definitely in years to come, you're gonna see that that's gonna be a much bigger footprint in that area. With the Minera Florida mine, you can see what the contribution from Chile is. In addition to that, we have one of the really star mines, Jacobina. Again, a mine that we wanna own in its own right with enormous potential. I've already spoken about the Yamana team are busy executing the final stages of stage two. There's a stage three and then a stage four, and with plenty of opportunities along that greenstone belt in Brazil.
Lastly in Mara in Argentina, we have an operating mine, Cerro Moro, a smaller mine, but with only a small footprint of that mine that is yet being explored. The real star of the future portfolio is the Mara project. It is a big project, one of the largest undeveloped copper gold projects around in the world at the moment. Certainly in the combined business, this is likely to be an asset that is likely to be developed in a much bigger company. This could be 400,000-600,000 ounces a year of gold equivalent. I know a lot of folk think about Mara, and that have done work around Mara, think about it as a big greenfields mine.
Well, it's not a greenfields mine, and it was an existing mine when it was Alumbrera. It's got a plant, it's got a tailings dam, it's got licenses, it's got its pipeline to the coast, it's got the logistics in place to get the rail line down to the port. All we've got to do is go and build a new mine. Of course, it's not nearly as simple as that, but it's not a greenfields mine. In a bigger mine like ours, this is highly likely that an operation like this at the right time can and will be developed. If you look at that together, this is what the combined company will look like. You can see all of this in very, very attractive gold mining jurisdictions.
These are the assets, the flagship assets in Gold Fields. They're not all of our assets, but certainly the assets that move the dial. Tarkwa, St Ives in Australia, South Deep in South Africa, that's now becoming and as it's growing and has growth for the next number of years. Granny Smith in Australia and the Salares Norte mine, one of the best gold assets being developed in the world at this point in time, will develop on average 450,000 ounces of gold at just over $500 an ounce all-in cost. That's the portfolio. Those of you who know Gold Fields will know these assets. Those who know Yamana will know these assets. For most of the Gold Fields shareholders, these will be new to them.
I won't go through all of the detail, but I will pick out one or two highlights. If you look at Canadian Malartic, this is a joint venture run by or managed by Agnico, but producing over 700,000 ounces a year, of which our share is 360,000 ounces. A very material mine at all-in sustaining cost of $900 an ounce with underground potential. Half of the potential of that underground we have not included in our valuation. The second big one, the whole new lode of deposit that is available with the potential next shaft. All of that has not been included in the valuation that we see for the company. That will be developed in time.
I mean, this is one of the star mines across gold mines across the world. Next is El Peñon in Chile, very close to our Salares Norte mine. Great synergies between these. A proper mine in its own right. Low cost, $930 an ounce, with future potential. It has been as high as 300,000 ounces and has the potential to go back there. If you look at Jacobina in Brazil, it looks currently at 186,000 ounces growing all the time as we speak. This will be low CapEx growth that comes with the various next phases. Jacobina growing in this phase, I think, Peter, to 220,000-230,000 ounces.
It's got another phase after that, could grow to 350,000 ounces. Beyond that, we have untapped potential beyond 400,ooo ounces. This mine in disciplined capital investment, as it has been doing over the last number of years, has got tremendous potential. You can see this, what the all-in sustaining cost of this mine at under $750 an ounce. You see what that combination is why we're seeing the reduction. The contribution helps to reduce the all-in cost of Gold Fields. Then I've already spoken a little bit about Mara, and in the appendix to this presentation is a little bit more detail about Mara, and something that still is very exciting for us in the future.
Again, you know, if you choose not to invest in this project in time, there's still significant value that could be created if you were to monetize this asset. The point I'm making is we don't have to see for now the development of Mara to be able to justify the price that we are paying for these assets. On this slide, just shows you what the growth looks like over the next couple of years. We grow from 3.3 GEO combination to 3.8 million ounces. You can see beyond that, say over the next 10 years, if you wanna put a timeline to that.
I know the Yamana team are probably saying, "Well, no, it'll get there a lot quicker than that." You can put a realistic timeline over that and say that you could very easily, if you looked at the hatched bars, you could add a million ounces over that period. Yes, some of that will replace some declining production from Gold Fields, but the majority of that will be production growth. Again, you know, I think sometimes this alarms people because they think, "Oh my goodness, we're going to now just be using all the capital in growth." The great thing about this is there is potential for good disciplined growth. In the subsequent slides, I'll show you our focus. We haven't lost the focus on returning cash to shareholders.
What you have here is opportunities, and in a disciplined way, you can bring these on, and not undermine your ability to return cash and increasing returns to cash to shareholders. I won't go through this, but I think pictorially, you can just see this is the pipeline of early-stage exploration, development projects, near-term potential and execution. If we start at execution, you can see Salares. The blue is Gold Fields. The Salares is the project that we have in execution at the moment, and there are two projects, Jacobina and Odyssey at Canadian Malartic, that are under execution at the moment. Left of that, you see the near-term potential, and this is all low CapEx production expansion at all of those operations. Again, you can see what comes from Gold Fields and what comes from Yamana.
The point that we've been making is Gold Fields doesn't have a pipeline. We will need to invest in that. You can see the number of exploration opportunities. A number of those are advanced exploration opportunities, so they're close to being able to be used in investment decisions. The next two slides, I think, are important from a point of view now of thinking about the way the company will still retain its DNA around capital discipline and shareholder returns. On the left-hand side, you can see the combined company has a net debt to EBITDA of 0.39%. That means actually both companies have a net debt to EBITDA of 0.39% because that's what Gold Fields is now. The point here is that we are not buying into a company that has got substantial debt.
We both companies have got very good balance sheets. Balance sheets are in great shape. Both of the companies are investment-grade rating. If you look at the liquidity, this combined company will have liquidity of $3.8 billion. No need to go back to the market. No need to do anything different, anything strange. We're putting together two companies with balance sheets in great shape. It's also companies that have been thinking about returns to shareholders in similar way. You can see over the last number of years how both Gold Fields and Yamana have increased cash returns to shareholders. You can see our dividend yield at the moment is 2.5%, with potential for that to increase.
If we look on the right-hand side, I think the important message that we wanna leave with is what we are doing is providing optionality, and we are putting the company in a strategically fantastic position to manage for the next 10, 20, 30 years. Our focus will remain. The DNA of this company will not change. It's not changing as a result of executing on our strategy. Our focus remains on financial discipline and shareholder returns. I mentioned up front that what we didn't want to do is put a company together that took us backwards on our ESG journey.
Here you can see just with a very high-level snapshot on the left-hand side, Gold Fields, on the right-hand side, Yamana, with not too dissimilar ratings, although sometimes with different rating agencies, and with similar commitments in the blue bars at the bottom. By putting these assets together, we actually bring some lower costs, some lower emission assets, therefore helping the combined company to have a lower emission footprint going forward, certainly helping the ESG journey. Very similar approaches on the ESG front between our two companies. I mentioned that this deal is not premised on synergies. There are synergies. There will be some synergy around corporate services. You can see this is a portion of the corporate savings, which I think is possible, and I don't think is pushing the boat out.
There will be material, in our view, supply chain savings when we put together the South American assets, and we have a much more leveraged, much more bulky South American business. We do think that then by supply chain and bulk purchasing, we can deliver additional synergies. I think it's on the operational front, on the bottom left-hand side, that I'm the most excited. Here we have, you know, two sets of very strong technical teams that are able to work together. Actually, in an environment where technical expertise is so short, so rare, what you can see is I'm much more excited about the operational improvements and the operational benefits that we can get by working together.
We've spoken about the synergies and the opportunities we can see, but we don't think that those opportunities apply to everyone. We don't think, well, Joe Bloggs can come with his company, do the same deal as we have, and they'll get the same benefits. I'll share with you. I mean, if you just think about the type of assets that we're putting together. If we look at the Jacobina and Tarkwa, if you put those two continents together, you can see that those assets form part of the same type of mining geology. The Jacobina and the Tarkwa mines are very similar.
The expertise that Yamana have for mining underground on those assets, and that we've got for the open pit mines there's plenty of opportunities for both sides of this company to be able to contribute. If we look at the orogenics in Australia and Canada, and Wasamac, we think there's a huge amount of opportunity. Now, these opportunities aren't available to everyone else. The copper gold porphyry synergies, and the way we think about mining those at Cerro Corona, we think will help hugely at delivering of Mara. Likewise, the same type of geology exists for El Peñon and Salares, given that they're in exactly the same region.
Here you can see that our technical teams and technical operational synergies are not available to everyone else, and they certainly are available to improve the revenue line of the synergies here. But there are synergies, but this deal is not premised on delivering synergies. I'm gonna hand over to Peter because he's gonna talk about, well, why should we do a business with Gold Fields? Peter, over to you.
Chris, thanks. Thank you very much. I'm gonna begin with a couple of comments and a question. I founded this company in 2003, and some of the commentary today among our shareholders was, is this bittersweet for you, that you founded this company and now it is effectively being sold to someone else. The second comment is that we present an Americas portfolio that is an excellent fit into a number of different opportunities. That begs the question, why do a deal and why this one? The answer to that question is, this is a unique value proposition. It combines two strong platforms, creating a company that is better than the sum of the parts, and Gold Fields is the best custodian for these assets. Let's talk a little bit about the custodianship, and let's talk a bit about the what gets created.
It creates an immediate scale to become a new major gold company with unparalleled growth and quality. Top-tier assets with leading reserve life index amongst the senior gold producers. That's before we look at resources to further bolster longevity. It will be the third-largest precious metals producer by 2024. It has brownfield growth, as Chris mentioned, not greenfield growth. Where's the risk? The risk is not on the mine, the risk is often on the plant, particularly large plants, big scale plants in more difficult, less labor effective parts of the world. When the plants are built, that becomes substantially easier. It's low cost growth. It will be the fourth-largest company by market capitalization, but this presents that value proposition that I referred to a moment ago. As we meet the multiples of those larger peers. We have a complementary regional approach in the company.
We believe in regional significance, even dominance in the regions in which we operate, and we think we certainly see based on our diligence that Gold Fields seeks a similar approach. Yamana shareholders retain 39% of the combined company, and that's reflective of the inherent fair value. It's consistent with comparative net asset value contributions, and that's why these discussions were constructive. Gold Fields came to the conclusion that we were looking to come to, which is that the market is not reflecting our inherent and fair value, and we can justify an inherent and fair value that is higher, that 39% is reflective of that conclusion. It enables Yamana shareholders to capture more of that inherent value in assets, as you mentioned, Chris, such as Jacobina and Mara, where the geological experience together with size and scale will make a difference to the advancement and development of those projects.
With a larger company, the value in the assets such as Mara can be unearthed. We also came to the conclusion in our diligence that management competency is required to develop world-class assets. Mara is a world-class asset, and it requires management competency to get to that point. This globally diversified company will have 14 operating mines across four premier rules-based mining jurisdictions. Once again, it was consistent with our philosophy. We wanna be in mining-friendly jurisdictions, and we wanna be in rules-based jurisdictions. No one can argue that's true of where you are in Australia. That is very true of South Africa. It's true of Ghana, where Tarkwa is. You have an asset in Chile, which is where we are and already have a platform.
Rules-based, mining-friendly jurisdictions where there's mining pedigree and where we don't have to worry about where the labor force is coming from because it's already there in the jurisdictions in which we operate. This will have an expanded global footprint in those rules-based jurisdictions to complement our Americas portfolio. We have a shared management belief in building regional dominance anchored by flagship assets. In addition to all of that, it creates an industry-leading management bench strength. I appreciate that there are many who say, "Well, where are the synergies?" Fortunately, we have some synergies here. These deals should not be done based on the synergies. We're in an industry that is suffering in many respects from a shortage of high quality, competent and capable managers. If we can bring two companies together and improve that management bench strength, that's critical to success.
I describe it as more oars in the water and more hands on the oars, and that's critical and important to a combination and the success of that combination. We have a shared common vision and a commitment, as you mentioned, to ESG and the care of the host communities in which we operate. We have a joint track record of successfully delivering on projects with extensive technical capabilities. The combined management provides significant experience in certain geologies, comparable in our company to your company. We can complement the skills of deep underground bulk mining and open pit competencies. South Deep is one of the deepest mines in the world, and we have a mine in Canada that is a deep mine that requires a shaft, maybe a second shaft.
We firmly believe in our management and in our board of directors that this is not a mine that will be producing 500,000-600,000 ounces per year. There's plant capacity of 56,000 tons per day. Why would you ever limit yourself to one shaft at 20,000 tons per day? You would always try to optimize that. With experience in South Africa, we think that can parlay well into looking at how can we fast-track, how can the new company fast-track the development of another shaft and getting more ore to surface to go through that additional capacity. We have a complementary experience in Latin America to deliver value from exploration and through development and operational excellence. You talked a little bit about the shared knowledge. Salar Norte, El Peñón, and Minera Florida.
There's a Chilean platform, and that platform can be used for optimizations, risk mitigation, and value creation. It's always easier when there's a platform rather than just a standalone sole asset in a particular jurisdiction. That platform delivers more than 330,000 ounces per year. It's a robust, strong platform in the country. Odyssey and South Deep has underground bulk mining, as I mentioned. These are two quality assets in quality jurisdictions where the experience in deep underground mining in one will parlay well in the other. You've mentioned Jacobina and Tarkwa and the shared experiences and knowledge that can be translated between the two. While you talked about Mara and Cerro Corona, I think it's also relevant and important to talk about what happens with Mara. Here's an asset that should be developed.
It's an asset that certainly should go through the process of consideration for development. In a company that produces 1 million ounces per year, that's a more difficult decision to make. One that we would likely make, but a more difficult decision than a company that produces up to 4 million ounces per year or more. We believe steadfastly and wholeheartedly that while you're cautiously and conservatively talking about growing this company to 4 million ounces per year, we think that that number is likely higher than that. We have the scale to execute on these organic growth projects, and we can crystallize that inherent value immediately. For those shareholders who choose to remain, and I hope that there are many of those shareholders, there's significant value upside in maintaining a shareholding in this company. Thank you.
Thanks, Peter. I've only got one landing slide, and that is what we think will be the outcome of putting these two companies together. I started the presentation by talking about why we started looking at the assets that we were looking at and what we were trying to achieve and why we landed on Yamana. The outcome is when we do put these two together, while some of those may not have been the driving forces behind the deal, the outcome is what we think a true combination for long-term value. This will be a super impressive company when this deal goes through. We'll be creating a new gold major with a compelling value proposition.
It's a long life, low cost, leading growth mine, and few companies can boast of all three of those components at the same time. We'll have a portfolio diversified across the premier gold regions. Almost all of the big mining, gold mining companies have got some parts or some component of their business that is in less attractive jurisdictions. That won't be the case for Gold Fields. This is complementary, high quality portfolios with strong cash flows and a deep project and exploration pipeline. We have, as Peter mentioned, a robust platform to build off. We're not starting from afresh. We're not putting together a very you know early stage development company. These are two well-established companies that we're putting together. An awesome platform to deliver disciplined organic growth strategy.
We have, as Gold Fields, a project development track record. We can build mines, we can fix mines, and we can run mines. We have a strong balance sheet to be able to execute our projects in a disciplined way without going back to shareholders and without putting the balance sheet under pressure. Our vision that we highlighted up front when we last year were thinking about, well, actually, where could we take Gold Fields to? We were thinking that this is possible. I know most people put out visions like this that are aspirational. When we say that, how do we become the preferred gold mining company? Where actually people go to. Investors go to, governments go to, communities go to, employees go to.
We think that this combination is fast-tracking our company to be able to deliver on being the preferred gold mining company that delivers superior value, but sustainably. We've mentioned that we haven't lost focus on our ESG, and actually, this complementary portfolio actually accelerates some of the delivery that we have on ESG. With both of us committed to zero emissions by 2050, zero fatalities, and increasing gender diversity among the whole range of ESG metrics that we measure, have targets for, and that we update the market on regularly. At the same time, that bottom strap line, I think, says that while we are doing that, we will continue doing that, remaining focused on quality growth. Not growth for the sake of growth and not scale for the sake of scale. Financial discipline and increasing shareholder returns.
Ladies and gents, thanks very much for your time. Thanks very much, Peter, for the two of us together. I think we are now going to go to Q&As. Avi, do you wanna manage that or how are we gonna do that? Is that just gonna come through? Okay. Should we take a seat there and just do it like that? Okay, cool.
If you'd like to ask a question on today's call, please press star one on your telephone keypad. To withdraw your question, please press star two. You will be advised when to ask your question. The first question comes from the line of Anita Soni from CIBC World Markets. Please go ahead.
First question from me is in terms of I noticed in the presentation there wasn't any indications on what the key management roles would be. Is there anyone in the C-suite at Yamana staying on in the new company? It's my first question.
We happen to. Thanks, Anita for the question. We haven't landed on all that. I think post this announcement today, and as we engage with the management teams, we will then have conversations with the management team. I mean, it is a takeover, and it is an acquisition, and Gold Fields' management and the board will run the company. As Peter said, number one, firstly, on the operational front, we absolutely need just lock, stock, and barrel, everyone that's running those assets to run those assets because they're not competing in any role. There can't be two combined management and boards, but there absolutely is space for senior leadership roles. There's absolutely space. There's still plenty of work to be done with the integration.
The answer to your question, Anita, is that we will be engaging with the Yamana management, our management, and we'll be seeing on what basis, on a merits basis, which staff we integrate into the future company. We haven't spent that time yet. We haven't agreed so, and we haven't spoken to any of the senior leadership in Yamana yet.
Okay. Second question, in terms of the project pipeline for Yamana, I mean, Jacobina is not expensive capital, but I'm just sort of thinking about the Canadian Malartic expansion at Odyssey Underground. There's supposed to be a mine tour for that tomorrow. Wasamac. Should we assume that the capital spending programs and the startup timelines are unchanged with this deal? Or should we think that you might reevaluate and consider and talk with your partners on Canadian Malartic, at least?
Well, Anita, certainly in terms of how we compared models and in valuing the company, the conclusion that was reached was that steady as she goes on the project development for the underground of Malartic and also for Wasamac. Chris, perhaps you can comment on this, but my impression, certainly our management's impression as part of the diligence is that we're not changing the timelines on those projects. They're progressing according to the timeline that we'd set for them.
Yeah. Peter, I would agree with that. Look, we don't have a desire to say stop all things and, you know, we want the businesses to continue running. Yes, in a combined business, of course, we will evaluate, you know, project, and, you know, capital allocation. Of course, we'll do that, but that doesn't mean that we want anything to stop. We don't want the existing Gold Fields business to get distracted. They've got to continue delivering and all the things that they know they need to deliver. The same message, and Peter, I'm sure you've been saying that to your team and we'll be saying that to the team, is this is a business that's running and running well. Just, you know, carry on and we will around that, be talking to each other about exactly what that'll look like.
There's no intention to put things on hold and to stop value that's already in the process of being generated. At an appropriate time, of course, we'll have a look at some of these things. In our due diligence, Peter, as you correctly said, is that there was none of these things that had a big red light next to it saying, "Oh my goodness, you know, if we have a look at this, we've got to stop A, B, and C." We didn't have any of that because we, you know, we can see some of that value. We buy into that value, and how we integrate that, it'll be a function of, you know, the future. At this point in time, Peter, absolutely right, is we want the businesses to carry on performing.
Okay. My last question was just with regards to the TSX listing. You mentioned that you would delist that one for Yamana. I'm just curious why, you know, why focus you know just in Johannesburg and not, you know, retain that listing in Canada, given the large ownership base that's here?
Do you want me to respond?
Please.
Look, at the moment, the offer is, Anita, for either Gold Fields shares or for ADSs. That's the offer, that's the construct of the deal, and therefore the shareholders in Yamana will be offered either of those two options. Under those two options, we don't need to retain the listing on the TSX. Anita, the volume, the overwhelming majority of the volume in our stock is on the New York Stock Exchange, and the two are interchangeable, and that's true of the ADRs as well. This was not a sticky point for our board of directors. While you're right that there's a Canadian base equally, the overwhelming majority of volume is in New York, and certainly our board's experience is that investors go to where the volume is. That's why we came to this conclusion.
Okay. Thank you very much for taking my questions.
Thank you.
Thanks, Anita.
The next question comes from the line of Josh Wolfson from RBC Capital Markets. Please go ahead.
Thank you very much. Just a question on the regulatory side. What approvals are required, or is there any complexity associated with the domicile of each respective company?
Do you wanna share that? We're not seeing any regulatory hurdles other than ordinary course, and normally when one has multiple jurisdictions. From the timing point of view, the only issue on timing is the delivery of pro forma financial statements for an information circular. Gold Fields publishes results semi-annually, and we publish results quarterly. We will have a discussion on how we can expedite our financial results for the second quarter and Gold Fields' financial results for the half year, so that we can provide those information circulars into our shareholders' hands sooner rather than later. From a regulatory point of view, to go strictly to your question, we're not seeing anything that is an impediment or hurdle to timing. While we've said in our announcement that we expect to be complete in the fourth quarter, certainly we're aiming for the third quarter, the end of the third quarter.
I've got nothing further to add, Peter, thanks very much. We don't see any regulatory hurdles that are not part of the normal process of doing a deal of this magnitude.
Got it. On the Gold Fields side, you know, I think for Gold Fields shareholders, there certainly looks to be high dilution associated with this transaction for near-term operating metrics. Even when you look at what Gold Fields would've looked like, with Salares Norte coming online, and there being high cash flow there, you know, the deal still looks, you know, quite dilutive. I understand there are some merits here to scale, but there does seem to be a larger sacrifice of what that upside is in diluting that growth. Is there anything, you know, that we're not seeing here in terms of maybe risks on the project or other upside for Yamana within Gold Fields that we should be thinking about?
No, I don't think so. I mean, you know, I think we've spent quite a bit of time on the presentation so, talking about the value that we can see. Sure, Yamana's share price is undervalued. But that value is not only seen by us, it's also seen by the market. So the market is anticipating that in the not too distant future, as delivery of certain things happens, that value will come through. You pay for control, you pay for a takeout, and you pay for some of the upside value, you will pay to the existing owners. But I've made it.
I've hopefully made it clear and I hopefully I've emphasized enough that we still see plenty of upside, and we avoid very material injections of or investments in cash, more likely, of what we still have to do for the future of our company. I think that's not been felt or it's not been valued, and that's not been seen, but that still has to happen in Gold Fields going forward. I like to think of this rather by the Gold Fields investors, like we would invest in a mine, you would invest in some of the value that we can see, and that's, I think, what we are doing. We are investing our shareholders.
We're saying we can see that value and a lot more, and we're asking you to invest and trust management because we can do this, we can see that. What we're asking you to do is invest in this future value and the future of this company at what we think is a very attractive premium to get in there. This premium that we're paying is not wild compared to what the market sees. They're not valuing that now. We will get there. Some of that value unlock will come in our hands, and we don't see any material downside. I mean, there's normal mining things in, you know, we've got in our own assets that, you know, that we've got to manage on a day-to-day basis.
There's none of the, in particular, three big assets that make up 85%-90% of the value of this of Yamana. These are well-run assets. They've got low costs. They're contributing to a reduction in our all-in costs. We're excited to be able to you know to leverage off the synergies between our two companies, and we are not seeing any material downside. Even in the big project Mara, where traditionally, I think most people have said, "Oh, we don't know if this will ever be developed." In our hands in this combined company's hands, because we would have the scale to develop that. Actually, in the risk of where big projects are, they're in the plant, they're in the pipeline, they're in the logistics, and they're in the tailings dams. That's where the risk is.
Yes, there will still be risks, and yeah, we've got to go through it and evaluate, but I don't see insurmountable risks to be able to develop a project like that. Over time, at the right time and at the right pace, we think that we can develop that. We don't see, otherwise, we wouldn't be sitting here today if we believed there was material risk to the delivery of the value that we can see.
Josh, I'm going to supplement that answer a little bit by providing a bit of a challenge. You refer to high dilution, but look, one, when one looks at dilution, we have to look at short-term, long-term, what are the assumptions?
What is the methodology that's being looked at? Is it net asset value, cash flow, free cash flow? In my experience over three and a half decades of transactions is that the best transactions are the ones that don't check every box, but they check some of the boxes for one side and some of the boxes for the other. We have to be very cautious when we talk about high dilution or any dilution, because it is all based on the assumptions and what is it that one is looking at. If we looked at net asset value, for example, this transaction is very close to neutral to net asset value. There will be accretion to one company on short-term cash flow and accretion to the other company on longer term cash flow.
All of that is to be looked at in the context of the assumptions. Does Mara get developed or not developed? If Mara gets developed, then longer term, it would be dilutive to our cash flow. Equally, it would be more of a challenge, as I mentioned, for Yamana to develop Mara than it would be for this combined company.
Great. Thank you very much.
Thanks, Josh.
The next question comes from the line of Adrian Hammond from SBG Securities. Please go ahead.
Yeah. Hi, Chris. Thanks for the presentation presented today. I'd just like to perhaps ask a question on the softer issues around cultural fit between the two companies and whether some thought was taken into account regarding that. You know, draw your attention to deals of the past, such as that between Barrick and Randgold versus Newmont and Goldcorp, where clearly very different companies merged or combined and both had very different outcomes, if you look at the share prices relative performance. Could you give us some color as to what thinking was considered regarding whether this is a risk or not?
Yeah. Thanks. An interesting question, Adrian. I mean, something that because, you know, of course, we have to operate these assets going forward. We have to manage a combined company. I think Gold Fields has got sufficient history to be able to acknowledge that, you know, we all come from different parts of the world, and we all bring some cultural complexity, and we bring some cultural advantage. You know, you just look at Gold Fields as it stands today, is that we have Australians, South Africans, Ghanaians, Peruvians, Chileans, and even, you know, you just look at Peruvians and Chileans and, you know, although they're next-door neighbors, they can be quite different. Number one, from a portfolio of what we're putting together, we're putting more Chileans, some Brazilians.
This is not different from what we're doing today. Yeah, we get additional, we get Canadians. I'm not sure about Canadians. Other than those, you know, it's not something that we manage. That's not different for us to be able to manage different cultural groups of people together. That's not a problem for us. We absolutely excited about bringing different thinking and different people into our business because we just believe that diversity creates strength. In the culture that we've been looking at is to say, is this like, do we think the same way about business? It's not the cultural from different parts of the world.
We talk about, you know, are we gonna find a company that are just a bunch of cowboys and that they hurt people and they don't care about communities and they don't care about the impact that they have on society, and how they're thinking about the future and the contribution they make and the purpose that they have. You know, that's important for us. Is this just a company that only wants to grow and not return cash to shareholders? Because those are things that are quite difficult to change. What you've got to do, if you find that that is insurmountable, then you've got to say, "Well, we've got to do something fundamentally different, or we don't do the business together." Our view is that that's not what we found.
We found very similar cultural approaches to safety, to the environment, to health, to engaging with governments, to engaging with local governments, to engaging with communities, to thinking about the impact and the future and the contribution we wanna make to net zero and that sort of thing. We think, of course, we're gonna have. We'll be different companies and we'll be different. I mean, I guess a smaller company can be more nimble than a bigger company. A bigger company can have other benefits. I think we're gonna put together some pretty interesting positive cultural fits. The contributions that we make because of the places we come from across the world, I think will be positive. All around, I think, Adrian, when we've looked at culture from that point of view, how do we run the business?
We found that actually our businesses are run very, very similarly. We are different sizes, sure. We operate a little bit differently in different parts of the world. Yeah, we'll bring strengths to that discussion from both sides. I don't know if you wanna add anything to that, Peter.
I think that's excellent, Chris.
One of the things, I mean, when Brett and his team were going through this, it is absolutely one of the questions we ask is around the cultural fit. We can't say that for every company that we looked at. We don't think that there are companies. There's some companies where we had a big cross next to some of those things. It's not just because you get a big tick in under any circumstances. We have for a number of companies, we said, "We don't wanna work with these guys."
Perhaps I will add something to this. Do you know it? I'm sorry, Adrian, we've not met, so I will look forward to meeting at some point. There is certainly a willingness today to talk about climate action. The way we view climate action is that effectively it's an extension of if you're protecting the global environment, you're also caring about the local environment. We as a company have been very sensitive to ensuring that we're taking care of health and safety issues, that we are responsive to local environmental issues, that we are responsive to community issues, that we engage effectively with communities. We would not do a deal with a company that did not have that similar level of engagement.
Part of our diligence, and this was something that was critically important to our board of directors, part of our diligence was they wanted to make sure that from a health, safety, environment, and community point of view, there was a similarity, a simpatico, between the two cultures. We certainly came to the conclusion that there is.
Great. Thanks very much. Perhaps if I have a follow-up, Chris, you've now secured the future effectively and haven't abused the balance sheet. Are you willing to enhance dividends for shareholders?
Yeah. I hope I said it at least 10 times today, Adrian, that the discipline on returning to share cash to shareholders and increasing cash to shareholders is as strong as it ever was, and that's not. That's. We're not changing the way we think about that. Thanks. Yeah. No, I mean, that's always been our intention. Adrian, as we deliver Salares, the intention was and the expectation was that we would be able to increase returns to shareholders. I think the one thing that Paul always says is absolutely, as we increase the size of the pie, the slice, even if the percentage slice is the same, the absolute amount, I know you know that well, but we will be returning increased cash to shareholders.
I mean, there's different ways, of course, as you know, for shareholder returns, but that, you know, hopefully, I've stressed at least 10 times today that is not changing. Thanks, Adrian.
Thanks.
The next question comes from the line of John Tumazos from John Tumazos Very Independent Research. Please go ahead.
Thank you very much, and congratulations on this enormous work to get the transaction this far. I have two questions. First, the Agnico Kirkland transaction announced within the last year had a tremendous rationale, but the merged firm has not outperformed Barrick or Newmont. What will be your posture if the market doesn't appreciate this Rembrandt as much as you do? We all thought the Agnico Kirkland deal would trade up. Second question. South Deep is half of the resources in GFI, and it's been a problematic mine for two or three decades. Could you just review the fatality record and the risks of you know, regulators come down on it. Secondly, a sixth of the resources of GFI are undeveloped, and I've been reading about chinchillas and rare species of foxes. Heaven forbid, the mine is half built and not completed like Pascua-Lama. Sorry, but I had those concerns.
No, I think they're fine, John, and hopefully we can address them now. John, you know, what happens if shareholders don't appreciate the, you know, our story? I mean, we've been working on this story collectively between our two companies for, I don't know, like eight months or something. We don't expect the market to have instantaneously the same level of appreciation for this deal as we do. I mean, we have been working deeply on these things, doing, you know, and as Brett and his team are saying, and the same for Gerardo and your team, Peter, is our teams have been working at various layers of increasing depth all the way from initial discussions, desktop reviews.
When we say to the market, we can see A, B, and C, it's not because we woke up one day or we read a report. It's because of detailed work over an extensive period of time that has led us to this position that we believe and we can see and we can justify to our shareholders. Now, for many shareholders, they would have seen this for the first time because, of course, we've been working behind closed doors and to make sure that we want to get to this position and that we can motivate the shareholders. We're not asking shareholders to vote today.
By the time that we do ask shareholders to vote, we plan to engage both. You know, Peter's team has Peter's got as much work to do as I've and my team have got to do, 'cause Peter's got to say to his shareholders, "We think that Gold Fields are the right custodians for these assets, and that you wanna be in bed with them." We've got to go to our shareholders and say, "We think you're paying for the right reasons, and look at this, what we are buying and what we are creating." We expect to be busy for the next couple of months. We expect that we've got work to do, and we don't begrudge that work.
It's our obligation to show our shareholders what we can see, and we'll be doing that. We do that gladly, and we actually are very excited to be able to share this message, and to share this vision, and to share this work that our teams have done. You know, at this point in time, I don't think if there's somebody who doesn't see it yet, that we say that we can't help them see it over time. If you wanna add to that.
John, I would add. Look, it's never clear why one transaction may be in favor and another in disfavor. It's very difficult for us to be able to say, why would the Agnico Kirkland deal, and I don't know if it did or didn't underperform, but why would that deal have underperformed? I think the starting point should always be let's ask the question, why did the two companies do a deal? Is it consistent with their philosophy? Is it consistent with what they have said and whether or not they've said it? What does it create? In this case, we're not trying to create something, as Chris said, that is bigger. Bigger seems to be better today than it has been in the past. Better is always better.
What we're trying to do here is we're trying to say we're creating a company that demonstrably is better across all of the measures. If we're successful at communicating that, then we should be able to capture that value in our shares, in the shares of Gold Fields. I think we'll be successful at being able to do that. The starting point is we ask the question why, and why are we doing it? We're doing it because we're creating a better company. I know you asked questions, and Chris will answer this on Salares Norte and chinchillas and foxes, and I don't know if the plural is fox or foxes, and the South Deep. Our diligence, we visited those sites.
The conclusion that we reached, I can put hand on heart, pound the table, and say that an excellent job is being done at South Deeps to promote what the company has been saying, which is that we can get a better production at better cost. There doesn't appear to be any issue that leads to a delay in the startup of operations at Salares Norte. We can give that endorsement because we've been there and conducted that diligence.
Thanks, Peter. I'll quickly talk about Salares and South Deep. Look, we got asked a few times today, so why now? Potentially this deal when South Deep wasn't yet in the position it is today. Say two years ago, this would have been a difficult deal to sell to shareholders. We were much further away from delivering Salares, and we certainly hadn't yet got South Deep to a position that it was generating sustainable cash flow and had a proper trajectory that people could buy into. Over the last number of years, and I claim no credit for this.
This work has been underway for many years, and certainly Nick has been telling the market that, "Guys, the work that we're doing is going to deliver." Some of the tough work that team took in 2017 and 2018 to restructure the mine, sort out the labor relations, take on the unions. A much more constructive relationship with unions under the leadership of Martin Preece and Benford and his team. We have got at South Deep, in our view now, a mine that is like any other mine now. It's just generating free cash flow. It's got an upward trajectory. It's doing some fantastic work on thinking about the future with their people on safety.
The improvements in safety at that mine over the last number of years have been tremendous. We've got faith in the team, and they've demonstrated that. Over the last number of years, we have seen very substantial increases in cash flow, and our view is that that'll continue. While we had a 21% or 29% increase in production, 2021 over 2020, over the next number of years, we've said that we will continue to deliver growth, and we'll see 20%-30% increase in the growth. Commensurate, we will be able to, or aligned with that, we'll be able to manage inflation, and you'll see a real reduction in unit cost from that operation. That's become like any mine now.
Yes, it's had a troublesome history, but over the last three years, you can see there's been a track record of delivery and improving delivery, and that'll continue. Of the Salares Norte, you know, yeah, we've been very clear about what our challenges around chinchilla are. There's like 15 or 20 chinchilla on the project site, but in one specific area, in a rocky outcrop area that we need to start mining in 2025. We don't think that we need to 'cause it's the stripping at Agua Amarga where we only need to. This is the second pit that we need to start stripping much later on. We don't think. I mean, we could move those 15 or 20 chinchilla in one morning.
We just need to take the environmental authorities along with us, and we understand that this is a difficult period, as they're changing the constitution and they're putting in place more environmental rights. I mean, we are working alongside the government. We're working alongside as many experts as we can find. We've got universities, we've got people that are studying and doing PhDs on chinchillas and, you know, we've got the best minds around thinking about how we move these. We're not gung ho about it. We're not mowing down chinchilla habitat or anything like that. We've got enough time to solve this and to move the chinchilla to a different relocation. We are not worried about around chinchilla.
The foxes are something that we know. This is a new thing for us, so we've got to, because they move around, foxes, and we've just gotta make sure we've got protocols on the mine that can manage these foxes, which incidentally hunt these chinchillas. You know, we are not worried about the environmental impacts. They absolutely need to be managed, and that's absolutely something we want to do. We don't want to harm any of the natural fauna and flora, and we'll do whatever's necessary to look after them. We are not worried about it, and it poses, in our view, very, very low risk to our project.
Could you just refresh us how long has it been since there's been a fatality at South Deep? I know there were many, 10, 20, 30 years ago. I've been watching it since Placer bought it in 1998. Maybe it would give us comfort to understand the diminution and improvement in safety.
Yeah. We had one fatality in April of last year. It was quite a strange fatality when we had a very long drill steel that was stuck in an ore pass chute, and it had bent and was under tension. The shaft timberman who was cutting this because he wanted to clear the drill steel out of the chute hadn't realized the tension that was in the drill steel. When we cut the drill steel, it sprung back like a steel and unfortunately struck [Nasimi and he was fatally injured.
This was not, for example, a fall of ground injury, the kind of risk that you would anticipate at a deep seismically active mine. I think the team have done a great job in terms of mine design, in terms of support, being able to look after the safety of people at South Deep. Thanks, John.
Thank you.
The next question comes from the line of Grant Sporre from Bloomberg Intelligence. Please go ahead.
Good afternoon, everyone. Chris, thanks for taking our questions. A lot of the questions have been answered, but I've just got a follow-up one, in terms of the Mara project. Well, from my assessment, it is quite a large part of the value equation for the acquisition. Have you, in your due diligence, sort of discussed plans with the minority partners, Glencore or Newmont, in terms of developing the mine and their thoughts around that?
No. I mean, you can imagine we can't yet go to the other partners to tell them, "Hey, we're sniffing around these things and we're in discussions." No, we'll only be able to have these conversations afterwards. Look, perhaps one other thing, I mean, the thing about South America, I guess it's like other mining jurisdictions. The people sort of move around and, you know, we have got people in our business, probably to Peter Marrone's irritation at some point in the past, but that used to work on some of these projects that work for us now. I mean, we had, we've got, you know, our head of our new Chilean operations used to work at Mara. We've got folk that used to work at Jacobina.
We've got our head of our South American operations, Lucho, who used to run Alumbrera. When we send some of these people back to say, "Well, tell us what it looks like compared to when you were there." Some of this was fairly recently, but Lucho used to work a long time ago at Alumbrera, which is now the Minera plant. Their feedback to us was the plant's in good shape. It needs very little capital. These assets have been looked after well. They're running well. Some of the guys who used to, for example, work at Jacobina say, this is like 100 times better than it was when it was way back when they used to work there.
We've got a number of other than our people, and we took these you know very experienced mining engineers, geologists, exploration geologists formed you know very substantial teams that went to visit these operations. We've got you know thumbs up from people that not only visited those operations, but some of them used to work there, including some people at Mara. Some of our guys are saying, "Yeah, I mean, this is a big project." Yeah, we've got you know any JVs got an additional layer of complexity. None of our guys are saying. I mean, we manage mines and things like that. We manage big projects, we manage mines, we manage regions on a daily basis.
None of our guys are saying, "We can't manage this." One of the things Brett said to Lucho when he had went there, he says, "Hey, you're gonna have to run these things. Can you run them? Do you want to run them?" When you went there, you know, it's different to say, "Oh, no. Well, this looks lovely, then I'll give it to somebody else." Someone says to you, "You're gonna run this thing." then all of a sudden you've got a very different perspective of whether these are good assets to own. Our team have come back and saying, "These are great assets. We should own them." I mean, the team, when they left Jacobina, they texted Brett and say, "We've got to own this mine." You know, so again, you know, of course there's risk in anything.
Our view is that this is about the lowest risk combination that we can see, and the assets are the lowest risk asset combinations that we can see. We've got work. We are not approving the merger today. We will have to work with the team. Neither is Yamana approving the project today. We're not concerned that we won't, in the fullness of time, be able to do justice to some of those assets. Eddie, it looks like we're running out of questions. I think perhaps it's time. Are there more questions coming in somewhere else? There are. Okay.
The next question comes from the line of Rene Hochreiter from Noah. Please go ahead.
Hello, Chris and Peter. Well done on the deal. I think it's gonna be a good one, this one, and getting up the mining production league to third place. Well done. Peter said something about the market not reflecting the inherent value of Yamana. Why do you think that is?
Boy, what a good question, Rene, and I wish I could give you the categorical and unequivocal answer. Sometimes, there could be many reasons, but take an asset like Mara, just as an example. We think Mara should be developed. Clearly, there's still work in front of us. As Chris said, it has to go through completion of feasibility study and going through the permitting process, but it's advancing well. It's a low capital intensity project. All of the engineers in our company, and I would surmise, thank you, Chris, that in Chris's company would say the challenge of an asset like that is a 115,000 ton per day plant. It's not the mine, it's the plant.
If the plant's already built, then a lot of the risk is significantly, if not completely removed, so it should be developed. Having said all of that, Yamana is a substantive company, but we're a substantive company with 1 million ounces of gold production between gold and silver, gold equivalent production, per year. I think if I were an investor, I would have a natural skepticism to say, how much value will I place in it? Because I don't know if a company that size would want to develop an asset even of that quality, but an asset of that size. Part of what we've been dealing with is what are the strategic alternatives that we should consider.
I think you would agree with me, Rene, that markets prefer certainty rather than strategic alternatives without a decision on one or another. What is interesting about this combination is that with a production platform of, call it, roughly 3.5 million ounces per year, it's an entirely different paradigm, should the decision be made to develop it. It seems to me that it will unearth more value in a larger company than it would in a smaller company, even one as substantive as Yamana.
Okay, good. No, that's a good answer. Just following on from Adrian's question, what sort of dividend yield could we expect? I mean, you said you're sitting on about 2.5% at the moment. I've seen Yamana on 3.2%, and so is Agnico Eagle. What sort of a dividend yield? Obviously, it depends on the gold price, but what sort of dividend yield are you looking at to maintain going into the future?
Yeah. Rene, I mean, we've said that that we've got a dividend policy of 25%-35% of normalized earnings. I think for now, until we sort of see how things pan out, we would leave it at that. I think we absolutely would expect to be. We've been paying 30%, as you know, for a number of years now. I think we would have an expectation of moving to the top end of that range as we start delivering Salares. I think that would still be our plan. We would plan as we put the two companies together to retain that. We don't have a plan to all of a sudden chase massive projects.
There may be a period before other fairly material capital allocation kicks in that is, you know, at the top end of that range. I think we've, both myself and Paul and our board, have said, "Look, for now, we think that's an appropriate range. Let's leave it like that and hopefully get to the top end of that range in the next while." Yeah, we'd leave that. Of course, remember the other point I mentioned is, as we create more value, the size of that pie that we take 25%-35% of is much greater. I think we would seek to get the benefit of both of those, Rene.
Yeah.
That's how we would keep our-
Thank you.
That's how we keep our dividend policy for now.
Okay. One last question. Of the 14 mines that you have, how many of them are going to be working at less than $1,000 an ounce AISC?
Certainly the three big. Let's see. I see Brett's counting quickly, helping me count. He's like, "Five, I think." Rene? We'll come back to you if that number is different, but.
Okay. No problem.
I think, yeah. AISC.
Thanks. Thanks very much, Chris. Good.
Okay, cool.
Yes.
Thanks, Rene.
Thanks very much. Good answers. Thank you.
The next question comes from the line of Mike Parkin from National Bank. Please go ahead.
Thanks, guys. Most of my questions have been answered. Just wondering if you're considering, you know, a minimum scale of assets on a go-forward basis on deal conclusion in terms of kind of a threshold between core and non-core, given your scale. One would kinda seem to think that there might be a couple assets that are moving into the non-core bucket. Just any color there would be appreciated. Thanks very much.
Yeah. Mike, thanks for the question. It's something that we absolutely are always focused on. You know, again, I mentioned if three of the assets in Yamana are delivering 85%-90% of the NAV, then that is absolutely a logical question. Likewise, we have got a number of assets. Damang is one of those, for example, that we're thinking about. We are doing study work to see if we are able to do the next value-accretive investment at Damang. There is some questions even in our own portfolio that fit that. We don't have a problem with sort of 14 to 15 asset s, given the regionalized way we run our business. Australia, that's 1 million ounces.
With those four mines, that's very easy for one team to manage. We, you know, we would like to have more than one asset per country because one asset is an inefficient way to leverage sufficient scale. None of what we see worries us that we've got too many assets or too many regions. The good thing about what we're doing is we're not adding significant amounts of regions. We are adding Canada. We wanted to get into Canada. We think that Canada can provide a springboard in time to be a much more substantive region. We're not worried about that, but we absolutely will look at a number of the smaller assets that are generating less cash flow to say, "Are they not better housed in other companies?" Yeah, we'll do that.
I think what we wanna do is upfront not commit to that because, for example, I mentioned earlier in the presentation, we're quite intrigued with Cerro Moro, for example, in Argentina. Yes, there are certain challenges in Argentina you wanna make sure you've covered. But also, you know, we have touched such a small, or Yamana have touched such a small part of the total potential of that asset. You wanna make sure that you don't give away an asset or sell, you know, because it's small now, an asset that could be massively different in the future. You don't wanna give up that optionality. We just wanna make sure that we have crossed and ticked those boxes.
Over time, asset rationalization is absolutely part of the way that we think about that third leg of our strategy around improving the value and the quality of our portfolio of assets. I mean, even the way we think about, if you look at the three mines, those flagship mines, that we spoke about in Yamana, you know, those are $900 and below. If you exit two of the smaller mines that are $1,200-$1,300, all of a sudden you have a massive improvement in the quality of your portfolio. In a bigger portfolio, that becomes much easier to do. Yes, there may be some of those assets that are better held in others' hands, but we don't believe that we're qualified yet to make those calls.
Mike, you are familiar with the history of Jacobina. I know that there are people on this call that are thinking that perhaps none of them will acknowledge. If we go back to 2014, 2015, when it was struggling at 75,000-78,000 ounces per year, there were many who said, "Why don't you sell it because it's not core?" Look at it today. I think that a strategy, Chris, as you mentioned, of take your time and evaluate the geological potential, exploration potential, what can be done to improve the cash flows of an asset is always critical. Imagine if we had sold Jacobina in 2015, thinking it was not core. We would not be doing this deal.
Jacobina has become a world-class asset that in many ways, even with 230,000 ounces of production per year, punches well above its weight class in terms of its cash flows. With an all-in cost of below $750 per ounce, you know, there are mines that are producing 350,000 ounces per year that generate less cash flow. I would encourage Chris and his board and management and everyone who is on this call to say, "Take a very sanguine view and take your time," because one never knows where the future is.
One more. Okay. It seems like we've got one more question on the line.
The last question comes from the line of Leroy Mnguni from HSBC. Please go ahead.
All right, guys. Thanks. Thanks for squeezing me in. I appreciate it. Chris, my questions are related to the reserve life of mine of the Canadian Malartic asset and the El Peñón mine in Chile. It seems like if you're looking at the reserves, they've got pretty short lives. Is there a risk of maybe an exploration or maybe CapEx catch-up that is required there? Related to that, is the risk here not that y ou're going to end up having the same challenge that you have now of needing to convince shareholders of the life potential of these assets like you do in Australia, and that puts a lid on your ability to rerate.
Chris and I were sort of passing the baton on who should start answering the question. El Peñón is, if we go back to its history going back to 1999, it has never had more, in any one year, more than six to eight years of proven and probable reserves. We acquired it in 2007 with 7.5 years of proven and probable reserves, and here we are in 2022, almost 2023, and we still have 7.5 years of proven and probable reserves. We keep finding new ounces, except that it is more cost effective to find those ounces year-over-year rather than spend a fortune. We spend $16 million in exploration.
We could be spending more, but we would be wasting money because as we explore, we make new discoveries, year-over-year improvement in proven and probable reserves, replacement of what is mined, and then we're also into development on those ounces. It's more effective from a cost point of view and from the generation of cash flows. Interestingly, this was entirely coincidental, gentlemen, who are here on the Gold Fields side, but we've made a new discovery at El Peñón. This is literally over the course of the last year. We've called it South Deep. That was entirely coincidental. It's clearly in Spanish, but translated. South Deep appears to be the extension of historical veins that were much richer and wider.
We're not yet at the point of saying that this completely redefines the mine, but we are comfortable in saying that that discovery alone will extend mine life. It's yet another area for exploration year- over- year to extend mine life. We're very reluctant on an asset like El Peñón to ever refer only to reserve life index, because reserve life index completely underestimates the value of that asset. Imagine if in 1999 or 2000 one had said, because the reserve life index then being about 5.5 years, that's how we will value it. Except El Peñón has been one of the more prolific mines, in my view, a top-tier mine in the world.
Leroy, I mean, this is something actually we were puzzling about when we had a look at Canadian Malartic. It's one asset that we couldn't get to physically, but we talked to plenty of people, did lots of work, and even talked to some advisors that had done some work there. I mean, if you look at the resource, though, if you look at 19 million ounces of resource, this is a monster mine. You know, I think this is the point that we have got experience in the Australian orogenics, and we understand how to think about some of these mines. This thing is so massive that you could spend an incredible amount of money trying to convert resource to reserve.
Actually, what we've come to realize, they just think about this differently. Once they have delineated the ore body and have sufficient knowledge and sufficient confidence in the, this is the way I'm led to understand, sufficient confidence in the continuity of that ore body, then they say, "Well, why plug away spending a whole lot of extra capital that you could rather put into developing the mine into converting the resource to reserve?" Once they are clear, they've got a certain amount of reserve, they're very clear about the resource, they say, "Let's rather put that money into developing the mine." If you look at the resource, there is 19 million ounces, and that is not valuing still huge portions of that asset.
This is not an asset that you're gonna be saying after five years' time, "Oops, you know, we've run out of reserve." This is an incredible asset. And if you listen to the management presentations there, you know, they talk and they see this asset developing from 700,000- 1 million ounce mine. Now, we're not valuing this like that. I'm reflecting on what I hear and what I see, but they do think about this in a different way. Like you think about Australian assets, Leroy, you need to think about this. These orogenics are that's their nature, that you don't ever only focus on the reserve.
Chris, I'll supplement that by saying that with the Odyssey project at Malartic, there's more than 15.5 million ounces in resources. That number increased by a full 1.5 million ounces last year alone. This year and next year will be two really important years because these will be the two years. Remember, we're already in development on this ore body, and that shaft to access the ores. This year, we'll be converting a big part of the mineable ounces into proven and probable reserves this year and next year. It will be an explosive increase in proven and probable reserves across the board in Yamana, but certainly in respect of that asset.
Okay.
Yeah. Thank you.
Looks like we've come to the end of our questions. Avi, is that correct? Yeah. Look, I think just from, you know, from our team, thanks very much for everyone on the line. It's been a great pleasure to be able to present to you. Thanks very much for the questions. With that, we'll bring the presentation to a close. Thanks.
Thank you.
Thanks, Peter.
Thank you.