Good morning, ladies and gentlemen, and welcome to the Franco-Nevada Corporation Q1 2020 results conference call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on May 7th, 2020. I would now like to turn the conference over to Candida Hayden. Please go ahead.
Thank you, Chris. Good morning, everyone. Thank you for joining us today to discuss Franco-Nevada's first quarter 2020 results. Accompanying this call is a presentation which is available on our website at franco-nevada.com, where you will also find our full financial results. Paul Brink, our new President and CEO of Franco-Nevada, will provide a company update, and Sandip Rana, CFO of Franco-Nevada, will provide a brief review of our results, and Eaun Gray, VP Business Development of Franco-Nevada, will comment on business development. This will be followed by a Q&A period. Representatives from our executive team are present in our boardroom to answer any questions. We would like to remind participants that some of today's commentary may contain forward-looking information, and we refer you to our detailed cautionary note on slide two of this presentation. I will now turn over the call to Paul Brink, President and CEO of Franco-Nevada.
Thank you, Candida, and welcome to all on the line. Our succession planning has been well signaled and a number of the role changes took effect at our AGM yesterday. Today is the first day with Pierre as Chair Emeritus, David as Chair, and myself as CEO. David and Pierre have set a very high bar at Franco. I'm looking forward to the challenge of the new role. I'm delighted to have David's guidance as Chair, and I'm confident the next chapter in the Franco-Nevada story will be a good one. We were also pleased yesterday to welcome Maureen Jensen to the board. Maureen's experience both leading the Ontario Securities Commission and working as a geoscientist in the industry will be great assets to the board. Franco-Nevada's been fortunate not to have any COVID-19 cases amongst our staff, and they've been able to remain fully productive working from home.
We do have temporary closures at two of our core assets, Cobre Panama and Antamina. Candelaria and Antapaccay have continued to operate normally. First Quantum has placed Cobre Panama onto care and maintenance until the Health Ministry is satisfied that the quarantine conditions are appropriate. Antamina has also been temporarily suspended to support Peruvian COVID response efforts and to facilitate a change in the workforce. They've safely demobilized the workforce, and while they're working towards a restart, the timing's still uncertain. Of our other 52 cash flowing assets, 11 have announced temporary reduced or curtailed production, although five of those have since resumed activities. Franco doesn't have any fixed costs related to these investments, so any temporary closures are effectively only a deferral of revenue. The energy side of our business has been impacted by a sharp downturn in oil prices, operators reduced CapEx plans, and production curtailments.
We have reviewed the carrying value for our energy assets and have recorded impairments this quarter, primarily related to the SCOOP, STACK, and Weyburn. On a positive note, I'm pleased to announce our board has declared a quarterly dividend of $ 0.26 per share. It's a 4% increase from the previous $ 0.25 per share and the 13th consecutive annual dividend increase. Canadian investors in Franco-Nevada's 2007 IPO are now receiving more than a 9% effective yield. Lastly, a brief reminder. In April, we released our 2020 Asset Handbook and ESG report. The handbook's our annual staple with descriptions of our main assets. The ESG report details our ESG efforts, including new commitments to the World Gold Council's Responsible Gold Mining Principles and the UN Global Compact. Both reports are available on our website and also as hard copies by request.
With that, I'll hand it to Sandip for the Q1 financials.
Thanks, Paul. Good morning, everyone. As you will have seen from the press release issued yesterday, the company reported strong results for our key financial metrics for the quarter ended March 31st, 2020. Those metrics being gold equivalent ounces, revenue, adjusted EBITDA, and adjusted net income. The company did report a net loss of $98.8 million for the quarter. This was a result of recording impairments on some of our energy assets. These are non-cash impairments and reflective of the current uncertainty within the energy market. An impairment of $207.4 million after tax was recorded on our Stack, Scoop, and Weyburn investments. Revenue from our energy assets is forecast to be less than 10% of revenue for 2020.
Looking at the performance of our mining assets during the quarter, which is best reflected by the number of gold equivalent ounces sold, slide three highlights the GEOs sold for the last five quarters. Year-over-year, the company had a 10.6% increase in GEOs sold. Company sold 134,941 GEOs in first quarter, compared to 122,049 GEOs in first quarter 2019. The main source of the increase was from Cobre Panama. This asset began delivering gold and silver ounces to Franco-Nevada in third quarter 2019. The company sold approximately 25,000 GEOs from the mine during the quarter. First Quantum has done a great job ramping up the mine. As Paul mentioned, due to COVID-19, the mine is currently shut down. We look forward to continued ramp-up once it restarts. Hemlo, and in particular, the 50% NPI, was also a strong contributor during the quarter.
One of the benefits of net profit interest is the leverage it provides to rising commodity prices. Revenue generated from Hemlo was $11.6 million in Q1 2020. The company did recognize less GEOs sold from our silver, PGM, and other mining assets during the quarter compared to first quarter 2019. This was in line with expectations. Slide four highlights our gold and gold equivalent revenue for the last five quarters. The company's GEOs revenue has seen a sharp increase year-over-year as the company has benefited from the increase in gold equivalent ounces delivered and sold, but also the rise in commodity prices. When combining the higher GEOs sold in Q1 2020 with the higher average precious metals prices, the gold and gold equivalent revenue in first quarter was $214 million, compared to $159 million last year, a 35% increase.
Energy revenue had a significant increase year-over-year, increasing from $20.8 million to $26.5 million due to increased production. With the decrease in oil prices, revenue was lower than Q4 2019, and we expect it to be lower going forward. As you turn to slide five, you will see the key financial results for the company. I won't get into the detailed numbers, as mentioned previously, it was a strong quarter for the company. We recorded significant increases in GEOs, revenue, adjusted EBITDA, and adjusted net income year-over-year. For first quarter, adjusted EBITDA was $192.7 million, a 37% increase over Q1 2019. As mentioned, we did record impairments on some of the energy assets, resulting in a net loss for the quarter.
When adjusting for this, along with other unusual items, adjusted net income was 67% higher in first quarter compared to Q1 2019, at $109.2 million, compared to $65.2 million a year ago. On slide six, we illustrate the diversification of our portfolio revenue generation. As shown, 89% of our quarterly revenue was generated by gold and gold equivalents in the quarter, with gold being 69%, silver 9%, PGMs 9%, and other mining 2%. From a geographic revenue profile, revenue was sourced 87% from the Americas, with Latin America being the largest. The third chart highlights the asset diversification of the company. Cobre Panama is our largest revenue generator at 17% for the quarter. Our top four core assets, Cobre Panama, Candelaria, Antapaccay, and Antamina generate 40% of the revenue for the company. One area that our board and management is very proud of is our focus on cost management.
We like to stress the strength of our business model and the scalability. The chart on slide seven clearly illustrates our focus on being as cost-efficient as possible in managing this business. Here we have highlighted our quarterly revenues and our quarterly G&A expenses since our IPO. Since 2008, our revenues have grown from approximately $25 million to just over $240 million this quarter. That is approximately a tenfold increase. This while our G&A has remained fairly stable over this time period. General and administrative costs have averaged $ 5 million-$8 million per quarter for the last 12+ years. For first quarter 2020, G&A was less than 3% of revenue at $6.2 million. Management believes we can continue to add to our portfolio and grow our business without adding significant overhead to the company.
Now I'll pass it over to Eaun, who will provide an update on available capital and business development.
Thank you, Sandip, and good morning to those on the line. Looking at slide eight, we'd like to highlight that Franco-Nevada is debt-free, having repaid the drawn portion of the RCF. The RCF, combined with marketable securities and working capital, provides $1.5 billion of liquidity at the moment. This positions us very well in combination with cash flows, which we expect to continue to be strong over the coming quarters to finance growth. In terms of the pipeline, the pipeline is very healthy at the moment. The team is very busy looking at precious metals opportunities, some small, some large, and some of modest size. In addition to precious metals, there are some opportunities in non-precious mining. In terms of size, we expect that perhaps some of the smaller to more modest-sized deals are actionable in the nearer term.
With that, I would turn it over to the operator for any questions.
Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by one on your touch tone phone. You will hear a three-tone prompt acknowledging your request, and your questions will be polled in the order they are received. Should you wish to decline from the polling process, please press star two. If you are using a speakerphone, please lift the handset before pressing any keys. Your first question comes from Fahad Tariq, Credit Suisse. Fahad, please go ahead.
Hi, good morning. Thanks for taking my question. Just on the last thing you mentioned on deal pipeline, can you talk a little bit about, in this commodity environment, whether you're seeing base metal producers more willing to engage in precious metal streams or royalties? Also, can you talk a bit about maybe any constraints you're seeing in terms of just being able to do due diligence in this environment? Thanks.
Thank you, Paul. You're right. One of the themes that we've seen emerge recently is base metals producers looking to monetize precious metals. In the current commodity price environment, you can see why this would be appealing. Much of our pipeline is comprised of that type of transaction. In terms of actionability, you're right, COVID-19 does impose some restrictions, we're actively looking at various alternatives to be creative in how we do due diligence keep our team safe. We're hopeful that we'll still be able to execute on transactions in this environment, as things improve with COVID-19, things will become increasingly more actionable. Thank you.
Thank you. Your next question comes from Cosmos Chiu, CIBC. Cosmos, please go ahead.
Thanks. Thanks, Paul, Sandip, Ben, and Eaun, and congrats once again, Paul. Maybe my first question is on the impairment charge taken on the energy portfolio. I see that it is the oil assets being written down, not so much the more gassy assets. On that front, I'm just wondering, I'm sure you've scrubbed the entire portfolio to come out with this impairment charge, but what assumptions have you made for gas, and can you talk a bit more about those gas assets and where they stand today, given the current commodity prices?
Hi, Cosmos. It's Jason O'Connell here.
Hi, Jason.
Hi there. You're right. In conducting our impairment analysis, we looked across all of our energy assets, including the gas assets. The Marcellus royalty that we bought last year is highly dependent on gas and also natural gas liquids. We did conduct an impairment analysis on that asset. It didn't result in us having to incur an impairment. The reason there is the production levels at that asset are more stable than some of the oil assets in this environment, where operators are cutting a lot of their capital costs. Range, who's the operator of the asset, came out with their budget, and in their most recent quarter, maintained their production guidance. Volumes will continue to be fairly consistent in the near term.
With regard to gas prices, they are low at the moment, and have been lower than at the time that we did that transaction. We expect those prices will recover over the coming quarters and over the coming years. We did look at it, but it did not result in us having to take an impairment.
For sure. Maybe as a follow-up, Jason, as you talked about, there has been cutbacks in CapEx, but I just want to confirm once again, it's got a bit of a lagging effect to it. Even if they cut the oil and gas producers, even if they cut CapEx now, the impact doesn't come later on, right?
Yeah, that's right. The nature of our royalties are that there is a deferral between when drilling happens, when wells are completed, when production comes online, and then we actually receive our check. We expect that drilling levels were reasonably strong in the latter half of 2019 and even into early 2020. We'll continue to receive the benefit of that drilling into Q2 here, even into potentially early Q3. The majority of the impact that we think we will see from the reduction in capital spend will occur in the latter half of this year and then into 2021.
Maybe switching gears a little bit, touching on the Island Gold royalty interest that you acquired in Q1. I just want to make sure, where is the royalty? My understanding is that Island Gold is currently undertaking a study for an expansion plan. Is your royalty going to encompass that potential expansion?
Thanks, Cosmos. Yes. We're quite happy to add that royalty. That royalty covers the Goudreau claims. You can have a look at the disclosure by Alamos, and you should be able to see from that that is the core of the mine. The preponderance of cash flow should be from those claims and accrue to the royalty.
Eaun, as a follow-up here, as you mentioned, given all the travel restrictions these days, it's hard to do due diligence. Clearly, this Island Gold royalty is a bit smaller. I'm just trying to understand in terms of your due diligence process here. Of course, it's going to be a lot more stringent when you're doing bigger deals. Would you still do due diligence on some of these smaller deals? What's the magnitude of difference here in terms of due diligence when we're talking about a billion-dollar deal versus $ 18 million today?
The level of due diligence obviously varies depending on the transaction. When you're buying a royalty like that on Island from a third party, your access to information is inherently more limited. The larger deals we do tend to benefit from thorough due diligence, and one of the things we pride ourselves on is the strength of the technical team. There's a lot you can do these days, evaluating and interrogating the data remotely, but we do like to put boots on the ground whenever we can. We're thinking creatively about how we get people to site, and to the extent that we have resources already in some jurisdictions, how we may be able to leverage those. We're working hard to continue to execute despite the travel restrictions as best we can.
Of course. Maybe one last question here. Great to see that Franco-Nevada has increased the dividend once again. That came along with the fact that share price has been very good year-to-date. Paul, as you mentioned, if someone that bought during the IPO would have a 9% effective yield. However, based on current share price today, it's more like a 0.7% dividend yield. I guess my question is, in the past, when you and I have talked, at certain points in time, Franco-Nevada had targeted a plus 1% sort of dividend yield. You're not there right now. Is that still a target that you look at?
It still is an important factor, in that many of our shareholders are generalists and some of those funds, 1% is the dividend yield that they're looking to include you in their funds. It is a level that we'd like to be at. We've got to also balance that in the board's minds with ensuring that the dividend is sustainable and progressive. We consider all those things in setting the dividend.
Of course. Thanks once again. Those are all the questions I have.
Thank you. Your next question comes from Greg Barnes, TD Securities. Greg, please go ahead.
Thank you. Sandip, can you give us some sense of what the energy revenue looked like in April, for example, just to get some idea, the low oil prices, what we can expect from that business?
It was lower, as I said on the call. Off the top of my head, I don't know, and I don't know if I'm in a position to provide that number at this time.
Okay. The Hemlo revenue for Q1 was impressive. What kind of run rate can we expect, obviously, at an equal gold price going forward?
Obviously, because it is an NPI, there's capital costs that get deducted against the amount. It fluctuates quarter to quarter. We have seen positive growth in the NPI over the last number of quarters as the gold price has risen. Again, it's all dependent on just in terms of how the capital spend occurs going forward. I think at these commodity prices, Hemlo should be able to generate between $5 million- $10 million a quarter in NPI revenue. Again, it could change based upon what they decide to do with their capital spend.
Sure. That's great. Thanks, Sandip.
Thank you. Your next question comes from Josh Wolfson, RBC Capital. Josh, please go ahead.
Thank you. Just back on the oil and gas assets. You mentioned having completed some of the impairment testing on the Marcellus assets. Was that testing also completed on, I guess, some of the other assets, Midland, Delaware, or the Orion project?
Yeah, thanks, Josh. It's Jason here again. We did do impairment testing across all of our energy assets. We looked at the Texas assets, Marcellus, and our Canadian assets. As I talked about for the Marcellus, because production volumes are not at risk there, at least at this point, there wasn't an impairment, given the prices we were using. When we looked at our Texas assets, they had actually been outperforming up until the end of last year. They had had a significant amount of drilling activity on the land. While we expect we'll see reductions in those activity levels, it was starting from a higher base.
With respect to Orion, we looked at that asset as well, and we expect that in the near term, we will see a reduction in revenue, but over the long term, because it is such a long life asset, we expect that the value is still there over the longer term and therefore an impairment wasn't required.
Okay. I'm not sure if this question's better suited for Paul or Sandip. When you look at the ATM program that's in place and I guess the increase going forward, the current rate of equity issuance is pretty similar to what the dividend is, which, from my perspective, kind of offsets what current shareholders are receiving. Obviously, the dividend is something which will continue going forward. How do you see the ATM going forward now the company is in a net sort of cash position and growing obviously on a steady state basis?
Sure. The objective of the ATM when we did put it in place middle of last year was to be able to pay off the credit facility as we had debt on the balance sheet, and we achieved that objective. At the time, we also said that we looked at the ATM as a tool for raising money, just as having a credit facility, which is why we are putting in a new one slightly higher for $ 300 million versus the $ 200 million before. It is there as a tool as we see fit for when we need to sell under it. There is no mandate to sell the full $ 300 million. It's opportunistic for us.
Okay. Thank you.
Thank you. Your next question comes from George Topping, Industrial Alliance. George, please go ahead.
Great. Thank you, operator. Hello, everyone. Say, on Cobre Panama, if it's shut down for a while and if they needed more money, would you be amenable to increasing your exposure there? Or is it bumping up against the limits you're prepared to have in a single asset exposure?
George, it's Paul. It's obviously an asset that we really like and have been so impressed with what First Quantum has done in building the asset. More the issue is the streaming that has been done relates to most of the precious metal that already comes out of the property. There's not much more room that you could do in terms of precious metal streaming there.
Got it. Just a follow-up on the oil. I see the forecast price is going up to $58 per barrel WTI. Given that, would you be looking to expand your royalties into the oil and gas sector?
Thanks, George. It's Jason here again. The pricing that we used in conducting our impairment analysis was an average blend of the engineering price decks. It's not necessarily a call that we're making, it's just what we thought the most accurate way of looking at future value, given the uncertainty around the commodity price environment currently. We do expect there will be a rebound in prices. For that purpose, if there are acquisitions that are very attractive in today's environment, we would certainly look at them. We're not seeing, at this point, a full sort of capitulation on the seller side. I think people are sort of waiting to see where prices settle out over the coming months. There are likely to be good opportunities towards the back half of the year.
At this point, it's a bit early for sellers to kind of come to terms with the new price environment.
Got it. Okay. Thank you.
Thank you. Ladies and gentlemen, as a reminder, should you have a question, please press star one on your touch-tone phone. Your next question comes from Tanya Jakusconek, Scotiabank. Tanya, please go ahead.
I think that's me. Congratulations, Paul, on the new role.
Thank you, Tanya.
Yeah, you're welcome. I came in a bit late on the call, so I apologize. Maybe you addressed this. I know you talked a little bit about your M&A front on looking at the precious metal side, and I think you said there were some small, modest deals and large deals to be done, and modest to small more in the near term. Would you classify modest to small under $500 million? Would that be a fair assumption?
Yes, Tanya. That's what I would classify as kind of a moderate to smaller transaction. As you know, we like to find optionality.
Sometimes we get good optionality in smaller assets. We'll continue to look at those, and we believe that there are some good actionable opportunities there in the near term.
Okay. I think you mentioned most of your opportunities are on streams on base metal companies, streams on the precious front. I just wanted to make sure I understood that to be correct.
Correct, Tanya. It definitely is a theme that's emerged, as you can imagine, in the current base metals price environment. Those are the assets that we like, long duration precious metals cash flow.
Okay. Just on the non-precious side, I think you said you saw some opportunities there. Would the non-precious metal side be mainly on base metals?
I think there are opportunities emerging in base and bulks.
Bulks. Okay. Thank you on that. On your due diligence, I came on when you were talking about your due diligence. You're looking at alternative ways of doing due diligence. I understand that it's easier when you have an operating asset. You've got the numbers behind it, developments are a bit different. What are some of the innovative ways you're looking at due diligence, or are we going to be looking at deals where you announce it but pending due diligence? Maybe a little bit on that.
Tanya, it's Paul. A bit of both is the answer. We don't want to get into the details of how we're doing it, but we are trying to be creative, looking at the individual risks related to assets and say, "How do we cover each of those off individually so that we can be sure that we've done a good job before we commit to anything?"
Okay. All right. Thank you so much on that.
Thank you. Your next question comes from Brian MacArthur, Raymond James. Brian, please go ahead.
Good morning. My part question has to do with counterparty risk, because I know you spend a lot of time on this, but just in the oil and gas, I'm not quite as familiar with it. Have the cutbacks on the election to do drilling with your partners been more just price related, or is there any counterparty in there that sort of had lines pulled and therefore is at great risk and that's why the production's been cut back? Can you give me sort of a percentage? Is it just mostly elective as opposed to forced? Is that a fair statement?
Yeah. Thanks for the question, Brian. I think at this point, the vast majority of what we're seeing is cutbacks in capital spending. It's elective cutbacks. There have been some instances of bankruptcy, but they've been minimal at this point. We'll see if that increases down the road. I think, keep in mind, one of the reasons we were attracted to the asset class in the first place is that what we're buying here, for the most part, is mineral title, which is effectively a perpetual interest in the land base. To the extent that there are operators that do go into bankruptcy, we'll keep our interest in the land. It will survive that bankruptcy. It's a very secure form of title that we've invested in.
Great. Thanks very much.
Thank you. Your next question comes from John Tumazos, Very Independent Research. John, please go ahead.
Thank you. Congratulations again. Do you look at the oil market as though it's an extreme temporary aberration, and production's going to shut down, and maybe people will drive when gas is free, and prices rebound to $50 or $100 in a couple of years, and this is an epic buying opportunity? Or do you want to be conservative out of concern there's a longer structural adverse change in electric cars and people stay at home and drive less?
John, it's Paul. I guess the first thing is investing both in the gold and in other resource industries. The only thing we know for certain is they are highly cyclical industries. It's not to say that there isn't structural changes going on in the oil and gas markets. There certainly are. What we're very aware of is, price isn't set by absolute demand. Price is set by the balance of supply and demand. What you're seeing in the oil space is a lot of capital that's been pulled out of the space that inevitably impacts supply. Where price settles out, like all cyclical markets, we don't know in the future. We're obviously looking at what the changes are, but expect that there may still be opportunities down the line.
Thank you.
Thank you. Your next question comes from Ralph Profiti, Eight Capital. Ralph, please go ahead.
Good morning, everyone. Thanks for taking my question. Paul, congratulations on the formal appointment. With respect to the decision with Continental Resources to take that contribution down by 50%, I was wondering what was driving that particular number. Is that sort of on the ordinance of the CapEx budgets that you're seeing in the industry across the board? Would that be a fair kind of relationship on how that spending profile was determined?
Yeah, thanks for the question. I think what's determining the level of spending for that partnership is, what we tried to do there is acquire acreage that is essentially in front of the drill program for Continental. The benefit of teaming up with Continental there is that they have a drill program that goes out 12 months or 18 months, and we're trying to acquire acreage that sits directly in front of it so that we get the benefit of near-term cash flow. What's happened in recent months, as the oil price has kind of collapsed here, is that Continental is reducing their capital spending and pulling back on the drilling activity. At least in the near term, there are less areas to buy acreage just because their drill program has been reduced.
Our pullback in capital spend for the joint venture vehicle is basically just related to how much acreage sits in front of their drill program that we can buy.
I see. Okay, yeah. Thanks for the clarity on that. I have a question on Cobre Panama. The precious metals deliveries are based on a ratio of gold to copper. I'm wondering if those ratios are fixed. Thinking just about the relative performance between gold and copper, we've seen some other triggers and other streams and royalties that change with the price profile. Just wondering if that is fixed ratios.
The ratios are fixed. There's a schedule that you can have a look at in our disclosure.
Yeah
as to how those change over time. They're referenced off per million pounds of copper, you get X ounces.
Yeah.
I don't think you have the issue with that stream that perhaps you're worried about.
Okay. Just maybe last one, coming back to Continental, how did the performance thresholds work that were to take you up to 75%? Now we have lower energy prices, we have an impairment, and we have a new spending profile there. Has that changed at all? Can you tell me maybe a little bit how that works?
What happens is, we have volume performance targets that Continental has to hit in order for them to achieve their full sort of financial carry. Those volume targets go out sort of a decade in time. It's a long-term target. What happens is, in the early years, they have outperformed, at least to date, they had outperformed the volume targets. There's a period of time here where even though activity levels are reduced and volumes are starting to fall short, there's a bit of a catch-up period. We don't expect that they will actually fall short of the volume target until probably sometime in 2021 or so. Although even that is uncertain. It will depend heavily on levels of activity and the volumes that they actually achieve.
It will be a benefit to us, but again, it's sort of a period of them catching up right now.
Got it. Yep. Understood. That's good clarity. Thank you so much.
Thank you. Your next question comes from Kip Keen, S&P Global. Kip, please go ahead.
Hi. Thanks for taking my question. I had two. Just curious, given that you do invest in the energy sector on the fossil fuel side, was there any interest in battery related metals, lithium, any other kinds of streams like that? Also, was there any update on the Law 9 issue over Cobre Panama or has that been resolved? Thank you.
Kip, it's Paul. I guess two things. In terms of commodities outside of gold, we're open to various commodities, whether those are base metal, battery metals, or oil and gas. Really what it's driven by is our ultimate objective, is just to invest in good deposits. That's the number one criteria, and happy to have a diversified exposure outside of precious metals, be in a multiple of commodities. We are open, it's just finding deposits that we think will be great deposits with good upside. Sorry, why don't you repeat the second of your questions there?
Yeah, I just wondered if there was any update on the Law 9 issue related to Cobre Panama, and its contract which came up in 2018. I hadn't seen any news flow about it. I'm just curious, has that been put to bed or is that an ongoing conversation between First Quantum and the Panamanian government?
It still is ongoing. I think you got to expect that in the current environment, I don't expect that it's at the front of the agenda. It will take a bit more time, I think, before it is resolved.
Okay. Thanks, Paul.
Thank you. Your next question comes from Carey MacRury, Canaccord Genuity. Carey, please go ahead.
Hi, good morning, guys. Just a question on Cobre and Antamina. Given they're offline, just wondering if you have a sense on what your revenue would look like in Q2, just given the timing differences between concentrate shipments and when you get paid.
Carey, it's difficult to say. Obviously, Cobre on a quarterly basis would provide us about 25,000 GEOs and Antamina anywhere between 8- 10. Just based upon how long shutdowns will last, it's very difficult to determine at this time.
Do you get paid quarterly or is it monthly?
Sorry. Antamina makes payment once a quarter and we will sell that silver during the quarter. Cobre Panama typically does two to three deliveries a month.
Okay.
There's anywhere from a four to six week lag in terms of receiving ounces from when they were shipped.
Okay, great. Thank you.
Thank you. There are no further questions at this time. Please proceed.
Thank you, Chris. We expect to release our second quarter 2020 results after market close on August fifth, with a conference call held the following morning. Thank you for your interest in Franco-Nevada.
Thank you. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.