Good morning, everyone, and welcome to this second quarter presentation from Green Minerals. My name is Ståle Monstad, and I'm the CEO of the company, and with me today, I also have Ståle Rodahl, the Executive Chairman. It is truly exciting times for our industries these days, as we are on the verge of a licensing round in Norway, and we in Green Minerals are more than ready to start to take on that work. I will start with the financial highlights. There's nothing really dramatic. It is in line with our guidance. We have a monthly or quarterly burn rate of NOK 2.5 million , and we expect to continue that throughout this year.
When it comes to the highlights of the quarter, Green Minerals was invited, together with a few other companies, to nominate blocks for the upcoming licensing round, and we are extremely pleased to see that all our priority areas are included in the suggestion for announcement. This is currently out for a public hearing. We also see that the Norwegian Offshore Directorate continues to release data from their work, and at the moment, we have received more than $50 million worth of exploration data. And of course, these data are instrumental in our exploration strategy and workflow.
We have also concluded our concept study for the production system together with the partners, and as far as we know, we are the only player with a complete solution for the Norwegian Continental Shelf on seabed minerals. We have expanded our memorandum of understanding in the CCZ on a large nodule license, which holds more than 200 million tons of wet nodules. Subsequently, the final tranche of equity is issued to OSI, Oil States Industries, at NOK 15 per share, and as a result of this, OSI becomes a 4% shareholder in Green Minerals. Our ambition is the same. We want to become a license holder in one of the world's most attractive copper resources, the Norwegian Shelf, with the lowest possible use of capital.
Our plan is to deliver 1.5 million tons of world-class quality copper ore for off-take, and the strategy remains the same. It's a partnership model, and we are going asset-light. The opening, the official opening in the Parliament, was taken in January this year. We have the production concept in place. We have also proven that we can take marine ore and blend it together with terrestrial copper ore in the processing plant, and as I mentioned, we have nominated the area for the licensing round. So we are really en route to deliver on all stated ambitions.
We expect to have a license, the first half of next year, and if all the stars align and we have the right license, we will be in pilot production already late 2028. And this industry provides for an unmatched capital efficiency versus traditional onshore mining. Like I mentioned, we hold now more than $50 million worth of exploration data, and if you contrast that to the current valuation of the company of $10 million, it's only... It's 5 times the market cap for Green Minerals at the moment.
The application process itself is expected to start this fall, in September, October, and we in Green Minerals are well positioned for a license win in early 2025, and we are really eager and ready to execute on awarded acreage. So the nomination process that we went through had a deadline in May, late May, and the area you see on the map here is, it is the entire area that the authorities wanted us to nominate within. The next slide here, you will see that the colored areas within that polygon is where the authorities have suggested to have the first licensing round in Norway. Like I said, all the priority areas from Green Minerals are included within this acreage.
It is a total of 386 complete partial blocks that is suggested for announcement, and the public hearing that takes place at the moment has a deadline in towards the end of September this year. And at the bottom of this slide, we see a timeline, and we know that the hearing is finished on September 26th, and we know there will be a license award in second quarter in 2025, and we assume a timeline like illustrated between those two endpoints. The application start in November, potentially, and an evaluation period in the ministry from February onwards.
The Norwegian Offshore Directorate is, like I said, continuing to release data from their work and also from the academia in Norway. The colored areas on this map to the right there illustrates the new areas where you have received data this quarter. It is mainly bathymetry data in the Greenland Sea, together with navigation data for P-Cable survey. The actual P-Cable data we expect to receive later this year, and also quite a bit of detailed data around the Mohns Treasure at the turning point between Mohns Ridge and Knipovich Ridge. Then a few words about the copper grade in the seafloor massive sulfides in Norway. This slide is really, I'm not going through that in detail. It will be available on the website.
If you want to learn more, you can have a look at it, but within the red square at the bottom, you see that the Norwegian Offshore Directorate estimates an average copper grade of 4% along the flanks of the West Valley, and 1.2% on average in the ridge or actual volcanic ridge deposits. And this is based on all available data from the Norwegian EEZ, and is calculated by several stochastic methods, including the ranged approach, which is considered best practice for the land-based mining inventory. And the difference between the actual deposits and the flank deposits is illustrated on the next slide. You see the dark blue color is actually the deepest part of the ridge, and that is the actual portion of the ridge.
Along the flank, there is uplifted ridge shoulders, that is uplifted due to the faulting. In addition, the Norwegian spreading ridge is an ultra-slow spreading ridge, which also has quite an important impact on the, for instance, the copper concentration. So along the flank, there is numerous opportunities, and also done on, on the, on the bottom right corner, you see a slide there or a insert illustrating the different copper grades for SMSs from an ultra-slow spreading ridge in the Atlantic.
You see the shaded area at the top, all are from ultra-slow spreading ridges, most of them from the Atlantic, and they are spreading out between 4%-10% copper concentration, while there are a number of other SMSs with much lower concentration of copper that are not deposited in an ultra-slow setting. So the actual average copper grade that we operate is in line with what we have from the literature and also from the Norwegian Offshore Directorate. Like I said, the concept study is now completed. It has been done together with our partners in Oil States Industries and the consortium led by Oil States.
We have reviewed several offshore setups and ended up with the selection of this connectable turret as the interface between the bulk carrier and the semi-sub or the mining vessel itself. This is a very elegant and stable solution, and we're quite happy with the outcome. We also established the TRL for all the various subsystems, and it also gives us a much better grip on the OpEx calculation in the financial models. So the key takeaway points, we have a robust system for the production of 1.5 million ton per year in a very harsh environment. The consortium we operate at is covering all the competencies needed to engineer and produce the required production system.
Also importantly, Oil States Industries becomes a shareholder in Green Minerals, highlighting the interest from the relevant industrial actors. I will now show an animation that only takes a couple of minutes. As was illustrated in this animation, we plan to use a semi-sub as a production unit, and we have taken a real-life semi-sub as a model for this and integrated everything within a very compact setting, within a limited space of a semi-sub. In particular, in very deep water, you need quite a lot of space for the pipes going down to maybe 3-4 kilometers of water depth, and also you need launch A-frame for the mining machines. But all has been integrated within the deck space available.
Another important factor with this solution is actually that the ship-to-ship transfer in high sea, which is quite a challenging sort of issue, is solved because we have two moored units, two stable units. The bulk carriers moored through the turret, and also a moored semi-sub, which makes it much easier to do ship-to-ship transfer of produced ore, but also personnel transport and logistics in addition. So it's quite an elegant and good solution. In addition to the production system, we have been working quite hard on the processing side together with the GTK in Finland, and this is also important for the entire value chain. It is really, like this slide is illustrating, at the heart of GAM's philosophy.
Because transformation of ore into a concentrate makes it much more valuable, of course, and also easier to transport. And we have shown that we can integrate this very high-grade marine ore into the value chain of existing processing facilities in the Nordic countries with a much lower copper ore grade. And we can boost sort of the production life. We can make the life of mine longer in onshore mines, because we have this very rich ore from the sea. It is really also that the CapEx up front of is, of course, much lower when you don't have to build a new plant, and you can start production with a much lower portfolio, smaller portfolio, than if you have to build a new plant.
So this is really a key element in our philosophy and strategy. Then, I will hand it over to our Chairman, Ståle Rodahl. So, Ståle.
Thank you. Just wanna go into the economics of the project a little bit. I'm gonna show a couple of slides that we showed on the Capital Markets Day, back in May, which I think is really central to understand the investment case here. So, as you've all seen, the deep-sea mining, the way we have set it up, provides superior key metrics that actually disrupt the economics of traditional, call it legacy onshore copper mining. One important element there is that there is no infrastructure investment needed in deep-sea mining.
So in contrast to onshore mining, where there's substantial infrastructure to be invested in before you can start mining, we will simply take the equipment on board a vessel or a platform, in this case, go to where we're going to start the mining, drop the equipment, and then, there is a very also man-hour light operation on top of the deck, that is guiding the machines on the seabed. So the CapEx per ton of copper produced will be around $17,000 for our operation, versus on average $30,000 for onshore copper mining. When done at one site, we will simply pick up the equipment, and leave for the next site. So there is zero sunk cost in our mine.
On top of this, we are, and in contrast to the way we see and understand our competitors in DSM, we will leave the legacy onshore mining model behind and introduce a more capital-effective offshore oil and gas services business model in our operation. This is a more asset-light approach, is based on rental of equipment, which is well-established in the oil, in the oil and gas, industry. And remember, what we're doing here, also in terms of technology, other than picking up the mineral on the seabed, of course, is simply subsea oil and gas technology.
On the environmental front, we see about a 90% reduction in the environmental footprint, and we also see that the more we meet with and talk with the environmental organizations, we see the understanding also sifting through there and being accepted with the NGOs, that deep-sea mining actually do offer some major environmental advantages compared to offshore mining. We will operate a semi-closed loop harsh environment deep-sea mining system, as Monstad just showed. That means there will be no mid-water plume. The return water will be transported to the sea floor. And importantly, there are no pumps creating noise along the riser system, and this has been a major argument from the environmentalists in terms of deep-sea mining.
So we will not, simply not, have that in our production system. Deep-sea mining offers a sharply reduced overburden in terms of, less waste and, also will mean less tailings. Next, please. The slide you see here shows one harsh environment deep-sea mining system that is exclusive to Green Minerals, and that we have developed together with our consortium, and the cash profile on the company level down from 2024 to 2034. I should add that this is on a company level, not on a project level. So cash flows on the project level are far higher, far higher than what you see here. So this is after we have paid the call it the rental services and our operator for the system.
So we can see here that, as we promised our shareholders, when we set out on this journey in 2020, our ambition was to get to license holdership and beyond with the absolute minimum use of capital. We have stayed true to this ambition. I'm super happy to say that we have so far spent less than $4 million to get to where we are now. That includes a production system, that includes a world-first blendability study, that includes two cruises on the Mid-Atlantic Ridge, and more. The peak capital spend you will see in 2028, when our pilot production is expected to start. On the current plans, we will then be at less than $50 million spent.
Thereafter, cash will build rapidly with almost $200 per year. This is, of course, pending copper prices, but at current copper prices, around $200 million per year, building a cash pile in the hundreds of millions, millions of dollars on the company level. So the economics here are really, really good, as you will understand. Just one comment on the cash spend. What this assumes is an exploration cost in the range of $10 million per year, every year going forward.
We will see how the Norwegian authorities handle the licensing here, but it could well be that we will only see a first round of licenses next year, and that the authorities then will halt new license rounds until they see the result of the first one. In case that capital spend of close to $50 million is too conservative, we could subtract the 20 then, meaning that our maximum capital spend would be as low as around $25 million, not $45 million. Next, please. In summary then, as Monstad went through, on the ninth of January, 2024, we had a major decision that de-risked the Green Minerals business case.
This decision was, when the Parliament, with an 80-20 vote, decided to open up for deep-sea mining in, Norway. Green Minerals has then been invited to nominate license areas, and as Monstad went through, we are really, really happy to see that, our, preferred blocks are included in, the, area announced, for opening, and that is now on, on the hearing round. We believe, we firmly believe that Green Minerals is in pole position for a license win, and, we firmly believe that the Green Minerals is the only player, that has done extensive, work, along the entire value chain, in, in, deep sea mining. Which sets us up, in a, a different position than, the industry, I believe. The production concept, has been developed.
These are globally leading partners. Basically, it's a world-class consortium that has been involved in other areas on this as well, and we are really happy with the solutions that we come up with for the Norwegian Continental Shelf. We have talked about the blendability study. It adds significant industrial value to the project. And we should also add that the mining infrastructure in the Nordics is well-developed, and we expect to sign off-take agreements when we get closer to first ore. But the industrial logic behind bringing this high-grade ore into lower-grade operations in Scandinavia is very, very clear. We see the deep-sea mining metrics as we are setting up our business model as superior to the traditional legacy terrestrial miners.
The economics here, as we have shown previously, are simply astonishing. We are talking about close to $200 million in annual EBITDA, with the CapEx being placed with the consortium. That means a pre-tax cash return on investment of more than 300% per annum for our shareholders, and it means a pre-tax cash payback time in four months. We are operating with pre-tax numbers, as we do not want to speculate in which tax system this industry will be operating under. But I can say as much as that the signals we are getting is that it will be a normal mining tax system.
These are the signals that we have been receiving, which means a 22% tax on Green Minerals. And then we'll see what happens thereafter. Of course, it is clear that a company like this will produce significant amounts of cash, which is natural resource-based in Norway. So, to round it off, we want to emphasize that Green Minerals is primarily a copper play, and that our license in the Clarion-Clipperton Zone provides upside on other key battery metals, but we are first and foremost a copper play. And with that, I think we conclude the prepared presentation, and go over to the Q&A.
It is open then to ask questions directly in the system for those who want. And then we have a couple of questions that's come in already. One is on copper. And I don't know if you want to have a go on this, Ståle, but the question is: "You seem different from other deep-sea miners in your copper focus. Why, why is that?
Well, number one, it is sort of the main metal in the seafloor massive sulfides. And we also think it's a very good idea, because copper is no matter what battery chemistry you choose or technology you choose, you will always gonna need copper. All the prognosis so far is that there's gonna be we're gonna need a lot of new mines for copper. It's not easy to find onshore good copper mines now. It's not easy to open up copper mines onshore. And we have this resource out in our exclusive economic zone in Norway, which is quite rich in copper. So, for us, it's a natural choice to be focusing on that metal.
Right. Okay, another question is, the Parliament decision seems to have de-risked the Green Minerals business case. What are the main risks now for the company?
Well, like you mentioned, a little bit, there is still... we're still waiting for the legislation. We haven't seen it yet. We know it's close, but it's not been published yet. So there will, of course, be... It's gonna be interesting to see what kind of tax regime and also what kind of frame conditions that we will have to operate under in Norway. And as with all commodities, there is a risk you also touched upon that, on the price of the product you produce, which is SMS.
But I think the biggest challenge we have at least is that this is an industry where you need to bring together different competencies and to mobilize sort of the entire industry ecosystem that you need around this industry is very important, at least the way we see it.
Right. And there we have, certainly, I can say that, just to add to that, at an early point, we set up this, ecosystem or this consortium for Green Minerals, that happened already in the fall of 2021. And, we are really important, this, this is-has been really important for Green Minerals, and we are, super happy, with the results that we've been getting out of this. And, Monstad showed the animation of the production system, which I think speaks, speaks volumes, about, how ready, this company is, in, in terms of, taking on, taking on licenses on the Norwegian Continental Shelf. And finally, there is, a question on, financing and, how we see our capital need going forward.
Yeah, of course, I think I can try that one. I think everybody, anyone who has followed the Green Minerals will have seen both for the last six months and twelve months, further back, that the company, of course, will get into a situation where we will need further capital. We announced this summer that we have issued 558,000 shares at NOK 15 to Oil States Industries. And, with that, Oil States becomes a 4% shareholder in the company. This is around twice the prevailing share price, and, of course, we see this as a value-accretive deal for our shareholders.
And I can also say that the board is cognizant of the fact that the company is in a strong position. I think there was a question here about de-risking on the ninth of January, and the board would completely agree with that. We see that as the one major obstacle for fulfilling the Green Minerals business case, and with that now behind us, we think we are in a very good position. So the board is cognizant of this, and just as with the OSI deal, we are looking to do accretive financing deals also going forward. Right now, we are in a very interesting position where we have an opening decision behind us, and we have the license, a license win, just in front of us.
Of course, we want to use this position to make an accretive deal as possible for our existing shareholders. Exactly how this is going to look is something that we will get back to in due time. So I think I will leave it with that, and see if there is any other questions that come in. There is one here: "Is it Green Minerals or OSI who will be the license operator?" So the answer there is that it is Green Minerals that will be the operator of the license.
Or to give you the full answer, depending on how the licenses will be split, between the various deep sea miners, an operatorship will be given, to one of these. And, of course, we hope that Green Minerals at least will receive one such operatorship. And when we receive it, Green Minerals will de facto be the operator. And then, as I said, in terms of our business model, we will then enter into agreement, with probably a driller, in order to actually operate the platform out there. So let's see. Are there any other questions? Anything that's come in through me? Can't see anything. Anything on your end, Ståle?
No, nothing here.
Okay. Well, with that, I think we conclude today's call. Thank you. Let me see. There is another question coming in here: "Can you tell a bit about OSI, and what is the net proceeds from the 4%?" So, this is, so Oil States Industries is then our consortium partner, and is the leading company in the consortium, and has been instrumental in setting up the other companies there. The net proceeds from the 4% is simply the production system that we have developed together with OSI.
To the best of our knowledge, this is the first time the consortium has ever entered into an agreement like this, and that is to help develop a system like this without any cash payment on it. So, this is the return, as explained in the press release when we entered into the agreement. With that, I think we will call it a day. Thank you for your attention, and we'll see you again in three months. Thank you.