Hello? Hello. Hi, everyone. Thank you so much for coming today to Lundin Gold's 2023 Investor Day. Just quickly to give you an idea of what the agenda is gonna be looking like, we have four presenters today: Ron, Terry, Andre, and Nathan. After each of their separate presentations, we'll hold a short Q&A session, where you guys in the audience and everybody who's watching at home on the webcast can ask questions. For those listening in on the webcast, please submit your questions online, I'll ask those questions when the time's right. With that, I'll pass over to Ron, and we can get started. Thanks so much.
Thanks, Finlay. First of all, again, thank you, everybody, for taking the time this morning to brave the smoke outside and come on over. Some of us came inside. First thing I want to do is introduce the members of the team. I think some of you probably have met them over the years. We do have some new faces. Terry Smith is one of the new faces. Terry is our COO, recently joined us from Pure Gold. Been with us now for about-
Three months.
-three months. I think he'll tell you some stories that things are a little different at Fruta del Norte than they were at Pure Gold. Andre Oliveira is one of our other... Well, he's not such a new face anymore. Andre's been with us now for over a year, our VP of Exploration, and Andre joined us from Yamana, and he's been a great addition to the team, and you'll see a lot of the efforts of his work, fruits of his work, in terms of really refocusing our exploration programs, and he'll talk in a lot more detail on that. Some of the couple older faces and one new face, Nathan Monash. Nathan's been with us since April 2015, and Nathan, I think Nathan will be doing, giving a good presentation on sustainability.
I think also, too, he's going to start at a very high level. We all know there's a lot of things that have happened in Ecuador over the last little while. He's going to start at that high level, so take you through and then down into the operation and end up talking about what some of the economic benefits that we've seen at Fruta del Norte. He doesn't look too old, but an older face, Chester See. Chester actually was with me on the very first meetings on Fruta del Norte. Chester was part of our due diligence team. I can remember going to Ecuador in October 2014, after we'd announced the deal and started to look at transition and going, "What the hell have we got ourselves into here?" Looking at all these labor laws and everything.
Chester's currently our interim CFO and will be stepping into the position of Senior Vice President of Finance. He's here today to answer any questions on the financial side. I'm happy to introduce Chris Kololian, or as many of you know, CK, who will be joining us as CFO starting on July first. A little less than a month. He's here today to meet a lot of the analysts. He's gonna be working with Finlay and I a little bit more on investor relations, also, as you know, Chris's background, he's gonna be working with the team also on some of our corp dev opportunities. With that, I'll get started. We are using a new platform now with give our kudos to VRIFY. I think you'll see some of the great things.
This has been a great investment for us. You've all seen this slide before. We thought it was really important to talk about it because these are the fundamental things you're gonna see throughout the next couple hours as to why we're so focused on this. We all know Fruta is a great asset. Through our exploration activities, we're seeing that it's actually, could be potentially a great district. With that said, though, we all know the saying, "Good grades can make lazy miners." We don't let that. That's not part of our culture. We really focus on operational excellence. We've gone from 3,500 ton per day, the original design capacity, now up to 4,400 ton per day. We're looking at going slightly higher for 2024.
We are continuing to focus on cost, one of the other big areas that we really need to focus on is recoveries, and Terry Smith will talk about that. We've got a lot of initiatives. We've recently engaged, Partners in Performance, PIP. They came last year. They're on site right now, training everyone to continue, so that operational excellence filters through every aspect of, everything at Fruta del Norte. Focusing on operational excellence, we are generating significant cash flow. I'll talk a little bit more about what we're doing with that cash in terms of balance sheet. Chester See's here to answer any questions around that, also we're starting returning capital to shareholders. We've now switched to a quarterly dividend, $0.10 per share.
Well, the next one will be coming out, I think, it's in a few weeks, couple weeks, the second quarter dividend. Even with cleaning up the balance sheet, returning capital to shareholders, we still have significant cash flow, and we're focusing on growth, organic growth and non-organic growth. You've heard us say M&A is something we're definitely looking at. The team's actually pretty busy looking at a few opportunities, but that's challenging. We're not gonna grow for the sake of growing. We are gonna we want to look at growing. We are a single project, single country. We know that. It's a great asset. We still think there may be opportunities.
We've got the team that are looking at things creativity, you know, creatively, and looking at, you know, by looking at things slightly different, we may be able to create opportunities that make sense. None of this, not any one of these things, can be done without a strong ESG platform. This isn't something that's unique to Lundin Gold. This is fundamental to the culture of the Lundin Group of companies. If you were to go see a Lundin Mining presentation, you'll see a big part of it on ESG. Filo, NGEx, they've got every one of these companies, IPC on our oil side. ESG is a fundamental part of the culture of the Lundin Group, and I think it's a large part. We think it's a large part of what's enabled us to be successful in Ecuador, is coming in with this culture.
Nathan will talk quite a bit about that. Just real quickly, we did have a real good Q1. Q2's, you know, we're two months through it. It's looking good, going well. It's also, we are seeing the lower grades that we had told you all about, that we are going to see some lower grades in Q2, 3, 4, just the different parts of the ore body. But, Q1 went well as compared to last year, and on an all-cost basis and all-in-sustaining AISC, it went really well in Q1. We are seeing a ramp-up, and Terry will talk a little bit about this in our sustaining CapEx. We had talked to you about that, Q1 was a bit slow. The fourth raise of the tailings dam didn't really go until April 1st.
That was planned, but it... That's 50% of our sustaining CapEx for 2023. That will, that's ramped up, and there's some other projects that Terry will talk to you about as well. We still are projecting to be in the, one of the lowest cost producers in the, in this industry throughout 2023. With the quarter, we're generating significant cash flow. You can see we started the quarter with just over $360 million, ended the quarter with $210 million, but that included paying down about $270 million in debt. You got the gold prepay at $208 million, the stream, $21 million, senior debt, $42, almost $43 million.
You combine those three, you can see we're generating significant cash flow. We really focused this last little bit on paying down debt. Chester can answer anything, or has any question on the gold prepay, but also returned $24 million in capital to shareholders. Fruta del Norte is a great asset. We want to continue to make it even better. This is our balance sheet as of the end of Q1. You can see the significant reduction in the debt levels. Those will continue to decrease. With that cash, again, the three pillars here: returning capital to shareholders. Right now, you'll see here in a little bit, our dividend yield is actually really good.
Cleaning up the debt and organic growth, which is what, organic growth is not only exploration, but Terry will talk about some things we're looking at from the operations standpoint and then on the M&A. Real quickly on the debt, there were three components. One is gone, the gold prepay. What this enabled us to do now is we have nine quarters remaining, Chester? Nine quarters or roughly 10,000 ounces per quarter that now are in our jeans, versus being paid out to Newcrest. That's gonna have a significant, especially at today's gold prices, significant benefit. The stream credit, there will be a decision that's to be made in June of next year, buyback 50% of this for $150 million. Someone asked me while we were just having a coffee or water out front, "It seems like a no-brainer?" Yeah.
Unless we have a dramatic drop in gold price, it's a no-brainer that we'll go ahead and do that. The last part is the senior debt facility, currently at $135 million. That's something that Chester and CK are gonna be really focusing on once CK is on board about, you know, do we look at... We think we should be restructuring that into an operating line, paying it down, but keeping that flexibility in our toolkit on the balance sheet, but pay it down anyways. Based on our budget, Chester, I think, which was $1,600, originally done at $1,650, this was paid off anyways in June of next year, right? We could pay down the debt and buy back the stream at $1,650 gold. We're gonna be able to definitely clean up this balance sheet significantly.
On the dividend side, you can see here we are. Our yield is relative to the senior producers, which many of you hear Newmont, I talk about being one of the best dividend deals in the industry. Well, we're right up there, and when you compare with the medium producers, we're quite a bit higher. This is something, again, all the modeling we did when we looked at our dividend policy was something that was sustainable and meaningful. That's why it was set at a fixed rate of $100 million annually. Andre's gonna go into a lot more depth here, really, we have three exploration programs underway. You can look at these two ways: conversion, improve the quality of our resources, bring resources into reserves, a near-term impact. Near my program is add to the resources....
That's really working right around New Fruta del No rte to add resources, which is a sort of a midterm impact. The regional program is finding a New Fruta del No rte. It's longer term because it will be on other concessions, so we're talking about environmental permitting and additional work like that. It will be a little bit more in the long term, but the blue sky. On that note, unless there are any questions, I'm gonna hand it over to Terry, now to get into more detail on the operations. Terry?
Thanks, Ron.
Yeah.
Do you want to talk about some of your M&A ambitions, the sort of parameters that you wrap around things that you're interested in?
Yeah, we're looking at primarily development-type opportunities. David, I would say we're our primary focus is on Latin and North America. Like, I think the thing to talk about probably now, it may come up later, is just what's our horizon look like? Our horizon right now is full of, or I would look at it as northern lights. There's lots of opportunities for us. You've got the Newcrest-Newmont thing now, which I think when we talked to Philly and I talked to a lot of you before, it was highly likely, well, it's happening. We see different things. We've now seen some recent presentations where we are part of. We're not the core assets, but we're not the non-core assets.
We're in that middle group, which, you know, we're seeing different things with regards to, you know, what does Newmont want to do? You know, it's. We're not an insignificant part of that transaction, right? Our market cap, with our market cap, is about $1 billion, the $17 billion acquisition. We're not an insignificant part. There's that aspect, David, as to what's Newmont gonna do? There's the other aspect, depending on what Newmont wants to do, are we in play? Well, that's to be determined, and we'll see what happens with that, but things are going there. That said, we're not sitting on our laurels and waiting to see what happens over here. We are looking primarily development, primarily more South America, but we are open. We are looking at some other opportunities.
There are some things that Andre has brought to us as well, early stage. You know, looking at some things that Andre really likes from an exploration standpoint, although I would say those are probably lower priority than looking at something on the development. We haven't seen anything yet from a producer side that really makes a lot of sense. For us, the challenge is, by just buying another producer, we're just adding more ounces, but very likely, given where we're at in the cost curve, it's gonna be higher cost. We're not seeing much there that's gonna really be accretive in the longer picture, in the bigger picture. It's actually, the water perspective, it's really interesting time for us because of the Newcrest, Newmont.
you know, Newcrest have said to us, they're very supportive of us doing things, and they've got full flexibility during this interim period. Essentially, If we want to do something corporately under their agreements with Newmont and Newcrest, it's Newcrest that makes the decision. They don't have to go to anything to do with Lundin Gold, it's Newcrest's decision between now and when the transactions close.
Do you feel as though you have anything that is actionable between now and the fourth quarter, that... Of course, the deal with Newcrest is likely to close in the fourth quarter?
There's some things that could be actionable, yeah. Possibly. We definitely are looking at some things that could move quickly. I think the key is there is we're masters of our destiny now, a little bit more so. Bryce?
On the dividend policy, $100 million a year, when you introduced that, the yield was much higher. Like, how flexible is the dividend policy, and what are your internal conversations on about potentially increasing it above the $100 million?
You know, like, that's a really valid question because you're right. You know, we wanted it at a higher yield than where we are now. I would say, Bryce, it's probably not much is going to happen till we get past, you know, cleaning up the rest of the balance sheet. You know, get that stream behind us, get the senior debt restructured, ideally. Then, okay, it also depends a little bit on what happens in the next six months with regards to M&A activity. I think it's definitely something fair to say, probably, this time next year, we definitely evaluate it. Chester, would you agree with that?
Yeah, I agree with that for sure. I do.
Any other questions? Okay, Terry, over to you.
Thanks, Ron. Okay, it's a pleasure to be here, everybody, nice to meet a lot of you, and it's great to be with Lundin Gold. When I met Ron late last year, he was talking to me about three things. He was talking to me about what a great asset the company has, great team, and, you know, the sort of emerging exploration story that was coming out. You know, three months in, you know, I've been down the site a few times, and I can safely say that this is a world-class deposit. I think all of us understand this is high grade, big ounce producer, lots of reserves.
Beyond that, I think some of the things that Ron was touching on really struck me, is that the company's done this right. You know, the ESG elements that Nathan will talk about later are phenomenal. I think no one can really hold a candle to what we've done there, and something to be really proud of. The safety performance, you know, We'll talk about it a little bit more later, but this is unparalleled safety performance in our industry. This is all coming from a company that's fairly young, has a single mine, but it speaks to the leadership that Ron's brought to the company and the quality of the team that he's attracted. It's a pleasure to be a part of that.
For Just curious, how many people have been down to Ecuador?
Okay. I wasn't sure, you know, doing a bit of a site overview this morning, how many of you this will be redundant for, but it seems like about half of you, haven't been through the site. We've got some Verify slides that I think you'll find pretty interesting, give you a bit of a flavor for what Fruta del Norte is all about. Here's a view of southern Ecuador, and I'll point out a few things here. Here is our project, Fruta del Norte, and I'll also point out Loja, which is about 140 kilometers from our site.
When I'm leaving Vancouver, I fly into Quito, and Loja is about an hour flight from Quito. A few hours later, I'm at site. This is 140 kilometers on mostly asphalt highways, cruising through the Ecuadorian mountains, and then we've got a 20-kilometer access road from there. The other thing I'll point out is Guayaquil up here. This is where all of our concentrate is shipped out, and it's also where all of our goods come in to support the operation. That's a lay of the land, and Nathan will go into more depth on sort of the local picture there. Here's a bit of a closer view, but I'll skip right through to this view. The green line is our site access road.
This is about a 20-kilometer access road up to the plateau that the mine sits on. This is one of the most amazing access roads I've ever seen, you know, developed through saprolite. If you're a nerdy engineer like me, you'd find some of the slopes and the work that was done there pretty amazing. There's also a 50-kilometer power line that's in blue here, that is connecting the site with a 230 kilovolt line. Moving into the site itself, I'm gonna step through sort of all of these, all of these items here, and I'm going to start by sort of over here, and we're gonna be looking east.
This is a view of the site looking east, and one of the things that I noticed right away is, you know, how lush this is. This is a lot of forest, a very biodiverse place, and the development has really taken that into consideration. This is a very light touch from a footprint perspective. You know, there's been a lot of consideration in terms of how do we minimize footprints, and even some of the disturbance that was generated. We were talking last week, a lot of it's already been reclaimed. There's a lot of thought that goes into preserving the biodiversity that we're working in down here. I was talking about the access road earlier. This is it, just coming into site here.
I'll sort of step through the... Oops, sorry! Getting used to the Verify technology here. I'll step through things from the process plant to the paste plant and then over to the Los Peñas camp you can see on the horizon there. Here's our process facility. This is a really conventional gold circuit. You know, nothing really that special here that we're doing, which is a good thing. Just looking at sort of how our ore runs into the process facility here. We have our stockpile is fed into our crusher and then run through a crushing and grinding circuit. There's a gravity circuit that recovers some of our gold, and a flotation circuit that recovers the bulk of our gold.
We generate a concentrate that's then shipped to Guayaquil, as I mentioned earlier, and we leach the tail from all of that and generate paste tailings and conventional tailings down to our tailings facility. As Ron mentioned, this is a 3,500-ton a day nameplate. It's been ramped up to 4,400 tons a day, and I'll be talking about a little later how we're looking at optimizing that a bit further. There's a few other facilities I'll point out here. This is... Oops! Pardon me. Our lab and our main water treatment plant, and as you look down the stretch here, that's where we'll be talking about portals and our admin facility a little later. This is our paste plant. About 60%-65% of our tailings go underground as paste backfill.
This is a great little plant, you know, very conventional, but it has the capacity to really match our mill capacity for the most part. You'll notice that up in the hill here, this photo was taken last year while the south ventilation range was still under construction. That's why you can see a structure up there. That south ventilation range was just recently completed, and that's allowed us to really open up the mine a lot better. That's been a big key piece of infrastructure for us. Here's a shot of our camp. Obviously, soccer pitch features pretty prominently here. Our Ecuadorian team loves that soccer pitch. I don't think I've ever seen it without somebody running around out there, kicking a ball around.
I like to run around this track. I mean, I'm not much of a soccer player, so that's what I do when I'm down at site. This is a 1,700 person camp. Really nice, quiet camp. You know, you can open your window at night and have a nice fresh breeze blowing through your dorm. The cafeteria. Honestly, I've been to a lot of mines, this is the best food I've ever had at a mine. It's a fantastic place to visit if you get a chance to come down and see us. It also has the best coffee I've ever had at a mine site, which is important for me to be functional. One more thing I'll point out here is, we have a nursery.
This is the first mine site I've been at, which has a plant nursery. This isn't for babies. This is to hatch plants and help with our reforestation projects, which is pretty interesting. Back out to a view of the project. We're just gonna spend a bit of time looking at the mine. You can see that it's sort of ghosted here, as it's heading underground. We'll have a look at the portal area. This is looking away from the portal, so this is our admin facility for where our dry is, our mine operations. Tech services sits in here. Just to the right is our mobile equipment shop. We're actually building a mobile equipment shop underground as well that'll help give us some capacity.
I'll talk about that more in a minute. Our fuel bay, obviously, for keeping our equipment fueled. If we do a 180 here, you can see our Currie and Kesa declines. These were twin declines that were driven to start up the project, and if you enter these portals, about three kilometers later, you're in the production areas. Just zooming back out. Now we're gonna take a closer look at the underground itself. These are the declines that we were just looking at up here, as I was describing, about three kilometers later, you're into the heart of the mine. The south ventilation raise, that was something that I mentioned earlier that's been recently completed. That's been a big benefit production-wise and just cleaning up our ventilation.
If you zoom in here. Well, one more thing before I zoom in. This 1,170 level, this is something that Andre is gonna be putting to good use from a drilling platform perspective. We're seeing a lot of exploration growth to the south. I'll talk about that a little bit more later. From a nerdy mine engineering perspective, this is a dry mine. I would call the rock quality fair. It's not fantastic rock, but it's also not terrible rock. I'm used to working in places like Nevada, which is, you know, very terrible rock for the most part. This is pretty good quality rock. You can get a sense as we look across the ore body here, all of these cross cuts are, you know, between 50 to 75, even 100 meters long.
That's the width of this deposit. This is a bulky transverse long hole project. This is about 600 meters, 700 meters long strike and 350 meters high. That gives you a sense of what we're working with here from a mine infrastructure perspective. All right. Now we're gonna sort of head back to where we started, looking east over the project, and now we'll head off to the tailings facility, which is just behind us here. It's just out here, and I'll speak about that briefly. This photo was taken last year as we were completing our stage 3 lift, and you can see some of the, you know, the equipment that's building the downstream embankment here.
This is a saprolite impermeable layer that's basically got rockfill placed on the downstream edge. There's a liner on the upstream side. On the right side here, you can see our main diversion channel that keeps water out of this facility and divert it around the project, so it's non-contact water. As we Pardon me. As we look down the toe here, it gives you a sense of the scale of the embankment, and then we've got our polishing pond at the toe. We're just completing our stage 4 lift now, and that's about 30% of the way done. As Ron mentioned, that's a good chunk of our capital this year. About half of our capital is being spent on that lift. It's going well.
We mine the material for this embankment from a quarry that's actually about, what is it, Ron? Maybe five , 10 kilometers away. It's a bit of a haul back and forth to build this embankment. All right. Getting back to slides here. From a health and safety perspective, you know, any company would look at this TRIFR and be quite jealous. I mean, to have anything below one in this industry is very difficult. To be really next to zero is quite an incredible accomplishment, and I really compliment Ron. Ron leads. When he's on site, safety is the first thing that's out of his mouth. It's the first thing that's out of my mouth. All of our leadership is super committed and experienced.
They've brought a lot of different ideas and tools, and we've sort of built from all of our different perspectives, the best safety system that I've seen. You know, I go underground. I grew up just north of Toronto here. I went to school in Sudbury. One of the first times I worked underground was working for Inco. You know, I learned what a five-point inspection card is. We have a five-point inspection card that is basically the same philosophical tool. It helps you understand the risks before you get to work and really sort of gets your day set from a safety perspective. We've got excellent training programs.
You know, to have an Ecuadorian workforce that's working this safely, that's still a relatively inexperienced workforce, is again, a huge accomplishment. There's a continuous improvement element in that I've seen. You know, every time there's an incident, it's investigated, we learn from it, we do better, and we figure out how to continually improve, which I think is important. Our problem is, you know, with this kind of safety performance, we can't rest on our laurels, right? You have to keep doing what you're doing and stay focused on continuing this great performance. We've passed 4 million man-hours without a reportable injury. That's a great accomplishment. We wanna get to five, six, seven. We wanna push that as far as we can.
Our goal is to have zero injuries. Ron touched on this earlier, but we've had a great start to the year. Obviously, Q1 was a record production quarter, great cost to boot. We're maintaining our guidance. Our grades are expected to be lower through the year. We talked a little bit about this on our Q1 earnings call, just the mine sequencing aspects and the stockpile aspects that led to such a strong grade in the H1 , and why that won't persist. I'm happy to talk about that later if anybody is interested. We are seeing some cost improvements. Things like our cement consumption. I'll talk.
touch on this later, we're seeing lower cement consumption as a result of some of the operational excellence things that we've put in place. We're seeing lower concentrate shipping costs, and we're shipping a higher grade concentrate, so we're seeing some cost benefit there. Our diesel prices are a little lower this year than we had planned for. That's been great to see. From a capital perspective, I touched on the tailings facility. We're 30% of the way through that. That's about half of our CapEx. There's a number of small projects that we're slow to start. We're getting ourselves organized and to execute all of those throughout the year.
From a three-year plan perspective, you don't have to rub your eyes when you're looking at cash costs or all-in sustaining costs. There's no one in front of these numbers. This is a low cost, great cash flowing operation. You can see that next year, we're assuming that we'll be spending a little less capital. We don't have a tailings facility raise next year, so that's why that's a little lower. We will have another raise in 25, so that's what's driving that up a little bit. The production profile is solid. I'll go into a little bit more detail on Verify as to where we're mining and why the sounds profile is just so solid for the next three years.
Here we are, back underground. What I'll do here is bring up this. This is a 10-gram per tonne wireframe. We're showing all of the blocks that are better than 10 gram per tonne in our resource model. You can see out to the south here, this is a new area that was added to our reserves as a result of some of the drilling that we did, and that was included in our latest tech report. That's nice to see, and we'll continue to add to that. I want to skip to the next, which is a 20-gram per tonne wire frame. That's getting very high grade. What I'm gonna do now is step through the next three years of areas we'll be mining.
Really, you can see that we're sticking to what has already been working. You're not gonna see any wild development out to, you know, these extents. This is just mining through a pretty standard long hole sequence. One thing I'll mention, that's 2024, and here's 2025. One thing I'll mention at the bottom of the mine here, this area, this is a drift and fill area. This is something that we had planned to use drift and fill just because of ground conditions. We've done some evaluations here, and we're pretty confident that that's going to also translate into some transverse long hole stoping, which is great. It's a lower cost, higher production mining method. That gives you a flavor for our three-year plan and where we're gonna be mining.
From a drilling perspective, taking this project from an exploration development project into production has required an immense amount of drilling to de-risk the project. You can see that it's translated into what is a 5 billion ounce reserve now. These, this, 3.6 and 3.2 of measured and indicated has converted into 5 million ounces of reserves. If you do the math, there's about 1.8 million ounces of resource that we haven't converted, so something that.
No, $3.5 million. There's some of the 1.8 of inferred, and 1.7. Sorry, 1.8 of indicated, 1.7 of inferred, so $3.5 million.
Yeah
... converted on that.
The my NI 43-101 training doesn't let me add those two together. Ron's right, there's a good chunk of reserves that, or sorry, resource that we have plans to convert. That's what we'll be talking about, and Audrey will touch on that a little bit later. The proof is in the pudding. We've mined 1.4 million ounces. We've replaced that with the conversion programs that the company's completed. This is, again, a hallmark of a great deposit that will just continue to extend the mine life. From an ops excellence perspective, it's a process of taking a great mine and making it excellent.
As Ron was pointing out, this is one of the pillars of our strategy, is to not just sit back and let sort of the gravy train, you know, continue to deliver here. We wanna get better, and this is a way of quantifying ideas and then implementing them. We've got a bunch of ideas that the company's already implemented, so this is not new, but this is the process that we're introducing to cast a wider net and really get everybody in the company contributing to the ops excellence piece. It really helps us quantify and then prioritize the ideas and then bring them through to an implementation and startup and locked-in process.
We'll be able to report, you know, more regularly on how we're doing in this, in this way. We're saving $2 million a year as a result of these three projects. I look forward to talking more about that as we get this implemented. Some of the things that we've already implemented, this is ventilation on demand. With the set of ventilation raised, now developed, the team tied in the main fans and the auxiliary fans so that we can shut fans off, we can vary their speeds, and it really saves power. There's nothing too fancy about it other than that, but it's a great, simple little project that's saving us money.
This is a cross-section of a stope, for those of you that aren't used to looking at engineering prints. This is a really basic project. What we're doing here is we're just building a bigger barricade. It's as simple as that, to allow us to pour these stopes in a single pour, and that allows us to not add so much cement to the initial pour that we would normally stop at this point, to let it cure and then fill the rest of the stope. We've implemented this, and now we're using a little less cement in all of our stopes, and that's saving us money. I'll touch on a few of the projects that we have on the mine side.
These are things that are in the pipeline. This is a picture on the right here of our underground truck shop that's partially finished. This is really moving our mechanics closer to the working phase, so we can turn around equipment faster, we can do more, more work on the equipment from the preventative side as opposed to the breakdown side, so that'll save us some maintenance dollars, and it'll also improve the availability of the equipment. That's a project that we'll implement in Q3. We're planning on building a dispatch system, and dispatch is nothing more than taking the fleet that you have and optimizing its use.
Shutting down equipment that's not needed, sending trucks and loaders to the important areas that they're needed to meet our metrics, that'll really improve our efficiency from a mining perspective.
Is that gonna be an automated system, or that'll be manned by somebody?
No, it'll be a manned dispatch system. Yeah. The next stage of dispatch is to take it through to some level of automation, which we're thinking about. And we've got a subtle thing, but it's, you know, if you've been underground before, you've seen sort of soft ducting. This gets mangled by equipment, it gets damaged by explosives, so we're putting in hardline ducting, and it's not hard in the sense that it's a hard aluminum piece of ducting. It's still a flexible piece of plastic, but it'll be there, and it's a lot more durable than the material that we've been putting in.
That'll make the ducting a lot more efficient, a little less friction, and we won't have to repair it as often. From a mill perspective, these are all projects, as Ron touched on earlier, recovery is one of the big things that we're focused on from an ops excellence perspective. All of these projects that I'll talk about are really aimed at improving our recovery. This cell on the right is called a Jameson Cell. This is a Glencore technology, and it's a flotation technology that facilitates better extraction of fine mineral particles, in our case, fine gold particles. We've installed this, we're just commissioning it, we're gonna test it. We're also evaluating Woodgrove, which maybe some of you have heard of.
It's a similar technology, we're looking at its benefits as well. Geometallurgy, this is a term that's kicked around a lot. Really, what this is it's understanding the geological units underground and their metallurgical performance, and then figuring out how you wanna blend those materials to feed the mill, to maximize your recovery performance. There's been a lot of good work done by the team so far to progress, and we understand that sulfides, hardness, oxidation, all sort of are key elements that we need to think about as we develop our stockpile strategy. That's gonna be something that we're working on.
We've already implemented a smart tag system, so we put these RFID tags in stope, and there's a scanner in our conveyor belt, so as the material is processed, we know which stope that material is coming from. It helps us decode sort of the geometallurgy puzzle with that kind of data.
Terry you should mention the warehouse with the fact about the bigger stockpile available for the winter months.
Yeah, that's a good point, Ron. We just commissioned a new warehouse. We were just walking through it last week. All the shelves are full. The old warehouse is really sitting next to our core source stockpile. By decommissioning that old warehouse and getting it out of the way, it'll open up the real estate that we have to work with to facilitate a better stockpiling strategy, where we're a bit hand-to-mouth on stockpile because of the small footprint that we have. By opening that up, we'll be able to have two, three, four stockpiles and be able to blend with a little bit more liberty. Thanks, Ron. That's a good point.
From other things that we're doing in the mill, we're testing different reagents and I'll be talking about our mill expansion here in a minute. Part of that project is a control systems upgrade to facilitate more instrumentation and automation in the plant. We're looking at a debottlenecking project that will take us from our current throughput up to 5,000 tons per day. Really, this is a bunch of small projects. This is not a big, you know. I'm not anticipating this to be a large CapEx project, but it is complex in the sense that there's a number of small elements.
We've listed all the different parts of the mill facility that are gonna be impacted, from crushing, to the float circuit, to our pre-leach thickening, and I just mentioned the mill automation. On the right here, I'm just showing an example of one of the things that we're looking at, is the tails pump box is a limitation on our throughput at the moment. It's because we can't run at such a high throughput when the paste plant is shut down. We're looking at implementing a splitter box and some dart valves that will allow us to push all of our tailings out to the tailings facility when the paste plant isn't operating.
We'll just be able to maintain a higher throughput, despite sort of those operational variances. The basic engineering is already underway. We're gonna be completing that a little later in the year. This will likely have a very high return. The permitting aspect of this is still in flux. We could be completing this as early as next year, but that remains to be seen as we look at sort of the net impacts of this from an environmental perspective, and then run that through the Ecuadorian process.
What is your expectation on how long it might take to permit the expansion, or what kind of a permit would you need?
Yeah. Well, there's a, you know, Ecuador has an environmental assessment process, just like we do here in Canada. If we evaluate this expansion and we see that it's a significant deviation from our already permitted EA thresholds, then we'll have to run that through an EA, which will take a couple of years.
When would you know if you need it? I guess, is the question.
later this year. Yeah. From a strategic development perspective. There you go. Go ahead.
Can you complete everything you need for the expansion than the current footprint from an EIA perspective?
Yeah. Yeah, there's no additional disturbance. It's more an emissions question. you know, is there enough dust and water use, gases, you know, these types of things that we need to evaluate, but there's no additional surface disturbance. Yeah.
You have a current cap on annual throughput?
Well, our cap is sort of where we're running at the moment.
From, like, a regulatory perspective.
We're permitted for 4,500 tons a day at the moment. Yeah.
You mentioned the mine.
Oh, thanks, Ron. Yeah, the to feed the mill, you know, you obviously need the mine to to be churning out the same... We've actually run the mine at 5,000 tons a day for several long periods already. It doesn't appear that we need any additional capital there. We've got the personnel and equipment that we need to feed the mill at this new rate. Okay, any other questions? I'll just wrap up with this last slide here.
What sort of ballpark CapEx are you looking at? Is it, just $10s of millions?
Yes
for the upgrade, do you think?
Yes. All right. From a strategic development perspective, it's really about taking the mine life that we have and extending it and enhancing it. Imagine Fruta del Norte with a lower operating cost, better recovery, longer mine life, like, all of these things to me are, is my job to make this project as big of an NPV as possible. That's what I'm trying to do with our resource conversion, the integration of everything that Andre is working on from an exploration perspective. We'll just have a better platform over the mine life if we have lower operating costs, better recoveries, higher throughput. These are all things that we're working on. We have to bear in mind that the facilities are also need to be taken into consideration here.
Our tailings facility is good for the current life of mine, we'll need to evaluate what that tailings facility looks like beyond that. Mine ventilation, as we move further to the south, how do we ventilate that part of the mine? Will we need another ventilation raise? Will we need some other piece of infrastructure to make that possible? From a quarry perspective, we're good up until 2027 to continue listing that tailings facility, but we'll need to expand our current quarry or find a new location for our quarry. That's something we're also evaluating. That gives you a perspective of what's gonna keep me busy from a strategic development perspective.
When you say that the tailings is adequate for the current reserve, does that mean 5 million ounces, and that's it? Or it's 5 million plus 20%, or how many tons can you actually put in that current design?
Yeah. We're permitted, up to... I'm gonna get this wrong. Stage 8, Ron?
Yeah.
There is additional capacity in that basin that we're.
1491.
Up to 1,491 elevation, yeah.
$1,471. $1,477 is the new raise.
Yeah.
20 meters higher, basically?
Yeah.
Yeah.
As you know, Terry, the valley widens out, right? You got more tonnage behind that.
Per lift, yeah.
Yeah. There is room for another lift, and that's something we're looking at.
Possibly 2 lifts.
Yeah, yeah.
About the throughput expansion, you mentioned before the conversion of cut and fill to longhole. Were you talking about converting all of that or a portion of it or?
All of that, yeah.
Yeah.
The team's done some geotech drilling down there, and it's looking pretty positive.
Right now, Bryce, the only cut, drift and fill we have left is actually up on the top of the recovery of the crown pillar. That's it now. We've gone from, in the feasibility study, it was 60/40, now to, I think, 90/10 or less than that.
Yeah.
On CapEx, I thought that the tailings lift this year was gonna go for most of the year, but in your comments, I think you mentioned that it was pretty much finished now.
No, no, we're only about 30% of the way down. Yeah, it's still on track for completing later this year. Yeah.
Yeah.
Oh, sorry, Bryce.
One last one. Sorry. Just throughput expansions, that's something that I think the team has been talking about, since, you know, since construct
This is, what are we in the third or fourth, expansion now? Longer term, it looks like the bottleneck or cap on that will be the underground. You said that you've ran at 5,000 tons per day already for an extended period, but with a short haul, twin declines and I guess 40-ton trucks...
Mm-hmm.
-how, like, how hard can you push the underground? Could you, can you go above the 5,000?
Yeah, I think, and Ron, again, I'll have to lean on here with month 3 in my under my belt, but I think the throughput is gonna be starting to get limited by the sag ball mill. We're trying to push the mill so that that's our limit. I think that mine could push well beyond that. From a mining perspective, there's nothing really holding us back.
Okay.
On the recovery front, you're currently around about 90%. With the improvements, are you looking to go to 92%, or you're more ambitious to go up to a 95% or better? Where do you see the range going?
To be able to be consistently above 90. We're still seeing issues. We had some issues just this past month, where we're into some different ore types, lots of marcasite, which is giving us some real issues, David. It's being able to be consistently above 90 and not see some of these deviations below.
Okay.
Yeah. Good question. Okay, well, with that, yeah. With that, I'll pass it off to Andre.
Can I just quickly remind, we've got quite a lot of people watching online. If anybody wants to send in a question or anything, there's a messaging icon in the portal, so please feel free to ask questions as well, and I can pass them on.
Thank you. Good morning, everyone. It's a great pleasure to be here, part of the Lundin Gold management team, and also a great pleasure to talk about Fruta del Norte. I guess one of the greatest discoveries in the last 20 years in the world. As a geologist, it is a unique opportunity for me, technically same. I'm going to start speaking about the geological context of FDN, for some of you that don't know about Fruta. Fruta del Norte is located in the Cordillera del Cóndor. It is located to east from the Cordillera de Andes. This is the central, where most of the famous deposits in the Andes are located. They are a much younger sequence of volcanic rocks, most of them from tertiary to recent volcanic rocks.
Fruta del Norte is located in the Cordillera del Cóndor, right here. It's hosted by a calc-alkaline magmatic arc, a great environment for copper, gold, and also epithermal gold systems. That's a new frontier for exploration. It has been just recently explored more systematically in the last 15 years. Specifically, Fruta del Norte is located along the Zamora copper-gold belt. It's a geological environment where several discoveries have been done in the last 20 years. Some great examples are the copper-gold porphyries, like Mirador and Warintza, farther north. The epithermal systems, like Fruta del Norte and Shinapinsa, that has been developed by Luminex, and also a historic skarn gold deposit that's called Nambija.
Just to note that most of those deposits are aligned along the north, northeast trend, so they are located over a major structure in the Andes. It's called Bolas Peñas. This geological environment hosts a minimum of 20 million ounces of gold and 35 billion pounds of copper. The Zamora copper-gold belt presents the same characteristics that we can find in most of the magmatic arcs in the Andes and other places around the world. As I had said, still very little explored. This is all the Lundin Gold concessions over the Zamora copper-gold belt. As you can see, we have a very strategic control of this highly potential geological environment. We have around 28 concessions that totals around 64,000 hectares.
Just for clarification.
Yeah.
That map does not show... Sorry to go over that, Andres.
Yeah.
Did not show the two concessions to the north and the six concessions to the south, which are part of the Newcrest JV.
Yeah.
For information. Yeah, the ones that Andres circled-
Yeah.
That previous map did not show those.
Yes. Before the Lundin Gold, most of the drilling has been done only around at the end. Just now, we are starting to advance to other concessions and exploring the entire district. Moving on to Fruta del Norte. Fruta del Norte, it's a blind gold, silver epithermal system. It's considered one of the best examples in terms of epithermal system. It contains all the classic textures, hydrothermal alteration, that we should expect in this kind of the deposit. The main reason is, Fruta del Norte has a really high degree of preservation. Fruta del Norte is covered by a sedimentary sequence that belongs to the Suárez Basin. I'm gonna show you. Right, this is Fruta del Norte deposit. Fruta del Norte is hosted by the volcanic rocks of the Santiago Formation.
During the development of the deposit, it was covered by a sedimentary sequence at the same time. This is the sedimentary sequence covers between 200 and 300 meters depth over the top of the deposit. This special geological conditions allowed the formation of this large mineral inventory in a very small volume. We're talking about, when you consider above, zero cut off grade, we're talking about more than 10 billion ounces over 1.3 kilometers long. It's possibly one of the highest concentration of gold per kilometer in the world, and possibly, and one of the main, the bigger discoveries in the last 50 years. We can divide Fruta del Norte in two main domains. The northern central domain, represented mainly by breccias and veins, and that's where most of our current reserves are located.
The southern extension domain, where most of our inferred resources are located. This part of the deposit are represented by volcanic mineralized rocks and breccias. Oh! Yes. We do have a really large mineral resource base. It's a high quality deposit with a sustainable mineral inventory. We have maintained a minimum of 80 million ounces since the start of the operation at Fruta del Norte.... This incredible deposit sits on a highly prospective exploration district with a very short history in terms of exploration. As I have mentioned, since the discovery, most of the drilling has been done over FDN. The discovery, delineation, and until the construction, few exploration has been carried out outside FDN.
An example, by June 22, we had less than 5% of the drill holes outside Fruta del Norte and covering the same geological environment that hosts Fruta del Norte. It's an exploratory terrain with world-class deposits already defined. It's also important to mention that the thermal systems always are together. They always occur in clusters. This is a unique first-mover opportunity for moving gold, because we control the entire geological environment that hosts Fruta del Norte. Apart from this, we have already identified in the last years all the critical aspects for additional high-quality deposits at Fruta del Norte province. For example, the major structures that hosts FDN. They are key components in the mineralization of Fruta del Norte. They have been already mapped for more than 25 kilometers long.
The same structures, they cross-cut the favorable lithologies that hosts Fruta del Norte, that are volcanic rocks of the Santiago Formation, and both structures and favorable lithologies remain preserved below the Suárez Basin. The Suárez Basin has 16 kilometers along the north and south direction, and four kilometers along the east and west direction. Several targets are aligned along those major faults. Some of them are represented by hydrothermal alteration over the conglomerates, which is really similar, the discovered outcrop that driven the discovery of FDN. Others have geochemical anomalies with similar signatures that we can find on the top of the deposit. What's our exploration strategy? What is the company's strategy to explore this high-potential environment? We have redefined the exploration strategy, and we started to focus on large underexplored areas around the mine.
We have started a near mine program almost 10 months ago, and we also have defined a plan with short, medium, and long-term plan to unlock our distributed district potential. We have three main pillars of part of this strategy. First is our team. It's important to remember that we have a geoscience group, identified by a successful grading model that resulted on the Fruta del Norte discovery. We have really a well-implemented and grading model in terms of exploration. The same group of the Fruta del Norte discovery group, we have added additional 15 geologists that brought fresh blood to the group. Several international structural geophysicist, exploration technologies, consultants, we are bringing the high expertise to our group.
Investments, we are going to invest around $24 million in 2023, mostly near mine, we are still have a reasonable exposition, the regional exploration and our land position. I think that is a critical aspect in our strategy. We have a highly prospective land where a world-class deposit has already been defined. An important aspect of our strategy is the drilling program. We have increased our drilling program systematically since 2021. In 2022, we started with the near mine drilling program, in 2023, we have already added additional 7,500 meters based on the first near mine drilling results. Actually, we have seven rigs turning. Another one should be added soon.
This is the largest drilling program since the Fruta del Norte discovery, when most of the drilling was located at FDN. We can say that this is the largest exploratory drilling program, FDN, retesting the entire geological environment that hosts FDN. Our strategy, as Rome had already mentioned, is very simple. At first, continue to replace the defeated the ounces by our conversion program. We still have 1.7 million ounces to be converted in our drilling conversion drilling program. Grow our in-pit resource base, potential and in-pit resource base, through the extension of the Fruta del Norte, but mainly exploring all the untested sectors that are part of FDN. In the regional program, develop our strategy in order to find another large deposit like FDN in the regional concessions. I'm going to start talking about our conversion drilling program.
We have replaced all the mining reserves with our conversion drilling program since the start of the operation. There are around 1.7 million ounces that are a great opportunity for further recategorization. We have started in 2023 an additional drilling program. In fact, we have started a two-year drilling program that will cover most of those inferred resources remaining. The white lines represent the drilling program underway, and the purple, possibly the 2008, 2003, and 2004 drilling conversion program. Just in three months, great results confirmed continuity, rigidity, but high grades in the various areas, all of them located outside of the mineral reserves. I'd like to highlight some results that have been returned.
First, the first one is 26.65 over 10.18 grams per tonne. 46.6 meters over 7.8 grams per tonne, both located in the northeast central sector along the down-dip extension. It's even more important to highlight all the results that were returned along the south extension of FDN, because most of those results are located, are part of this large base that should be converted in the next two years, giving to us, showing to us high quality of those inferred resources that still remain in our base. I'd like to highlight 106.2 meters over 4.7 grams per tonne. We're talking about 106 meters continued mineralization over the cut-off grade, the reserve cut-off grade.
Another great results that was returned, 4.9 meters over 12.12 grams per tonne inside the southern extension. It's a really high-grade core and possibly will generate multiple reserves in the year-end. This is just three months of drilling, so we should. Go ahead.
Some of the holes you showed on the last slide there, I mean, sitting in the conversion section of the discussion, but some of them look like they're a little bit outside of the expansion as well?
No.
Is that a plus, like an extension of the conversion hole?
No, they are conversion holes, but Let me see. Yeah. There are some conversion holes and some possibly related to some... yeah. I guess Some of those holes are located right here.
They were within.
Yeah.
Sorry. Oh, great. The blue is still the inferred block.
Okay.
So they're-
Yeah
... still within the resource envelope price.
Yeah.
Got it.
Right. Talking about our near mine program. Basically, our near mine program aims to grow mineral resources by extending the Fruta del Norte deposit, where it is, it remains open, and testing new sectors closer to the Fruta del Norte. We have started our exploration program, testing the south extension of Fruta del Norte. I'm gonna give you more detail, where we have already intercept three distinct mineralized zone, FDN, Castillo, and Bonza Sur. At the same time, along the down-dip extension of the deposit, drilling continue to confirm several areas along the extension, on that the deposit is still remain open. We have also identified some great opportunities very close to the deposit, like Fruta del Norte East and Fruta del Norte West. We have already initiated the drilling program on these targets.
This is just a quick overview of the exploration targets. This is the south extension, Fruta del Norte East and Fruta del Norte West, all of them are our high-priority targets in our near mine program. I'm going to start to talk about the south extension results.
Excuse me, how far does the exploration right extend into those?
They don't come up.
Yes.
They don't come up at all.
I have it for here.
Sorry.
Right, we have just completed 10 months of drilling. In fact, eight months of drilling, because we started between December and January. We have around 16 holes completed along the southern extension of FDN. one six or one six? 16.e
Sixteen.
16. 16 individual holes completed along the south extension of FDN. We can say that 100% of the holes have intercept hydrothermal alteration. Some of them related to the quartz zone of the mineral system, veins, veinlets, arsenopyrite, and pyrite, and gold mineralization. Sometimes the proximal alteration, which indicates that we are close to a hydrothermal system and even distal alteration, the pyritic calc-silicate minerals. It's amazing because 100% of them is still showing to us that the hydrothermal system is still continuous along the south direction. I would like to start talking about the Fruta del Norte South. Right, Fruta del Norte South is a new birth epithermal mineralization, also located to west from the east fault. It was producing great intercepts, like 41 meters over 41.8 meters over 5.16 grams per ton.
It's 41 meters above the cut-off grade, with a high-grade interval inside of 18 meters over 8.56 grams per ton. Another great results in this target, 30.3 meters over 5.11 grams per ton, including a higher grade interval of 14 meters over 9.79 grams per ton. What is interesting to start is that the hydrothermal alteration that are related in both intercepts are pretty similar to those ones that we find in the north and central part of the deposit. They are not like the southern extension, which shows to us that, indicates to us that possibly a new zone that was parallel to FDN and also extend to south. It's another cover.
It's so substantial, very well-preserved system, open along the north strike and along the south strike, all that's where we are drilling right now. As soon we move from FDN to the south, is still along the same, the same trend. We completed one hole in the area and intercept a proximal alteration zone. It was not still the core zone. That returned two meters over 12.14 grams per ton. We just intercept pyrites, silica, some veinlets of manganoan carbonates, but it still returns some gold mineralization, suggesting to us that we have a potential to explore the link between Fruta del Norte South and Castillo. It still show to us that we still have gold in the system. Then we started to explore Bonza Sur. Bonza Sur is a long and large geochemical soil anomaly.
This is part of the soil sampling program carried out by Kinross 12 years ago. They did not have time to explore it. As you can see, it's important to note how high is this anomaly. We are talking about over 50 ppm gold. This is really high soil. This is the volcanic rocks that already are exposed in the surface, so this is not the Suárez Basin model. We decided to test this anomaly, we explored our gold in the north end of the anomaly, and intercept 39 meters over 8.10 grams per ton, with a very high-grade interval. We decided to systematically cover this anomaly with additional drilling.
Another new hole located 250 meters far south, intercepted three meters over 46.98 grams per ton, which are higher grade interval. Several other results after this have already been completed. Some of them, most of them, have alteration pretty similar to ones with gold results that we still did not report yet. We are seeing the first half of the anomaly, we're still covering just this, just the north part of the anomaly. This is really a large anomaly. We should complete systematically a drilling program over it in the next months. Then start to follow up with higher grade results at Bonza Sur. All those three targets are assuming very similar.
Wait, wait, on that. Can we look at Bonza Sur, it's on the eastern side of the fault? Most of the other targets are on the western side of the fault.
Yes, that's. Yes, I'm gonna talk ahead, but yes. Yes, I think that's what we're learning. Now is that we needed to look more carefully this structure in both sides, right? Because even in the other side, and one of our most important targets today is for the same right here, which is on the hole, and I remind you the section of the presentation, where there is still a target two, a spot on the target.
Is the fault post external event, or is some sort of controlling feature of the-
Yes, actually, because this fault, at the same time, it controls FDN. It controls several intrusive rocks. The contact of this contact of FDN, we do have a very large intrusive rock, that we believe that it's seen in the mineralization. It's fully related to the mineralization. Along with the course of this fault, we also have other intrusive rocks. We believe that that's a key control. Actually, I would say that 80%, 85% of our targets in the best geological anomalies are located over this fault. Since that's a, you know, a new understanding that the project has acquired in the last 10 months.
This first round of drilling has allowed us to, at first, understand that we have a much wider hydrothermal area, a much wider mineralization footprint than we had thought. Actually, we are exploring around 1.5 kilometers beyond the Fruta del Norte mineral resources limit. I'm gonna show now the defined model that give us a better idea about the meaning of those results. I guess, just to remember, this is the exploration south decline, the south exploration ramp model, that will allow us possibly to cover part of the Fruta del Norte South. We are already considering to use this. This is the intercept of Castillo, so we believe that there is a significant potential to be developed from Bonza Sur along the south trend.
This is the other side of the fault that is Bonza, that is Bonza Sur. I guess a better overview, trying to answer your question. Yes, Bonza Sur in the east side of the fault, most Fruta del Norte, Fruta del Norte South, and Castillo are in the west side. All of them are still open. As I said, most of the geological anomalies are located above, in both sides of the structure. Our plan now is to, We have four weeks turning, start to delineate the best results that we have had, but we still keep running along this fault, because we cannot lose our focus and remember that we're really targeting a large zone. Even in the near mine, we still have a significant areas underexplored.
Andre, you mentioned the seismic program we are planning as well to help with-
Yeah.
structures.
Yes, that's a good point, Ron. I was not even considering. This is the east fault, and this is the west fault, right? We are considering some seismic program sooner, as we have the license covering the structures in different parts. The idea is to have a better idea about the geometry and the architecture of the relationship structures and the host rock, the Fruta, the Suarez, the Santiago Formation volcanic rocks. Yes, this is a quick overview. Where we have our mineralization area for almost 1.5 kilometers, with at least three initial zones already identified that should be followed up. In parallel to this, we are also exploring the down deep extension of FDN. We do have several intercepts that show the deposits still remain open.
We are really accelerating this program because this is important because through the added resources and reserves in the short term for FDN, and the Fruta del Norte East and Fruta del Norte West. As I mentioned, these faults are key controlling structures for FDN, and very few exploration has been done in the east and in the west. Few exploration has been done beyond the limits of the Fruta del Norte, to east and to west. This is a critical part of our program, we should be starting soon. As you can see, we have almost no drill hole in the east, in the Fruta del Norte East and in Fruta del Norte West, so these are areas just besides the Fruta del Norte, few hundred meters. Besides Fruta del Norte, it remains completely unexplored.
These two drill holes intersect distal, the proximal hydrothermal alteration, marcasite pyrite. With both, they intersect 80 meters, almost two grams per ton, but we know that this is not the main analysis zone that we're looking for. There is a space between almost 400 meters between those holes and FDN. There is a significant potential to test both structures also in the west side. A quick summary of our near mining program. We have really defined a disciplinary program for resources and reserves growth. Replacing reserves by our conversion drilling program, adding new resources by our near mining program, and also continue to explore for major discoveries like Fruta do Northeast and Fruta do Northwest targets, and also keep exploring the east fault in both sides. Our long-term program, the regional exploration.
The main objective of the regional exploration is really to find a new Fruta del Norte system. We are exploring the south concessions of the south extension of the Cuyes Basin in our regional concessions. We also do understand that's a different exploration environment. Geologically, it's very similar, but in terms of exploration environment, we have a harder topography, the cover thickness, and post-mineral lithology. We are still in the early stage of the exploration process. Our aim at first, the first step, is to identify major geological structures that we have already done successfully at Quebrada La Negra, for example, as well identified new targets in some unexplored areas in the Cuyes Basin.
At Quebrada La Negra, we have completed two drill holes last year. We intercept a wide hydrothermal alteration zone, more than 50 meters with breccia, quartz veins, galena, sphalerite, that returned some zinc and lead results, showed it was that's important hydrothermal alteration to be followed up. We are now drilling the continuity of these zones, now trying to target the core zone. We are also looking in more longer term. Again, less than 25% of our concessions have been explored. They are all over a large belt that has more than 20 million ounces of fine plus copper. We are now developing a generative program to really try to define new areas, larger areas to explore, and that could be hosting additional deposits. Just to finalize, right?
I think that you have already seen this slide before, but I think that what has changed is that we are starting to add new targets to the evaluation phase, and this is critical to us as FDNS, Bonza Sur. I think those are new targets that we are being able to move up into the triangle. Again, we do have several exploration opportunities in this unexplored geological environment. We have already defined a world-class deposit, I already do understand the main, the major controlling structures. In the near mine, a disciplined exploration program for resource growing in the regional, a significant upside to be developed. Our strategy build on knowledge, teamwork, and investments. All the Fruta del Norte team discovery group is extremely fierce.
I think that's a key aspect of our strategy, team, and drilling in continual expansion. We also internally, we recognize that the initial results are starting to show to a much larger system than we had recognized. The results come earlier than we had considered. I think that it makes us very confident that the exploration program should be able to extend the life of the mine of Fruta del Norte years ahead. That's what I have to talk about exploration. I'm gonna pass to Julie.
Any questions, Bryce?
Yeah.
On the east-west targets, are they all drilled from underground, or is there some component of surface drilling there?
In the east, we are drilling from surface.
Okay.
West, underground.
East and west are, there's no big drill from underground.
No.
Southeast to the south, but east.
Yeah.
East of FDN.
Yeah. Yeah. This side of FDN, we are drilling from surface.
All right.
The west side, we use the underground.
Okay. Is that an advantage going underground or should?
Yes, that is.
Should it move it higher?
That is.
in the priorities?
Yeah, that is.
It looks like it's kinda down the priority list.
Yeah
a little bit.
The west?
The west.
The west, the problem with the west is that the structure needs to be better defined by us. At the same time, the results have taken us to the east side, to the east fault, right? We have more than five kilometers long of the east fault already defined. We have already a drilling a plan ready to be completed now. The east fault is important, but the west fault is important, but the east fault, we have a much more stronger hydrothermal alteration. That's why we just have focused so far, but the idea is to cover both structures.
Do you think of those east and west FDN as parallel structures?
Yes, we do. At least where Fruta del Norte is.
Right.
Right. The problem is that this fault, we can recognize it for several kilometers, because it's also the border between the Suárez Basin and the volcanic rock. It's not the case for the west fault. The west fault is just a displacement. There is a abrupt displacement of the block, of the same volcanic rock, and we have just met along the extension of FDN. The south extension of the west fault is still unknown, but it's part of our exploration target. It's part of our exploration plan.
Is there vertical movement, do you know, on that, control?
We believe that's a strike slip fault with a like a 45 plunge movement. It's this interpretation. As we are in a rupel environment, we still have to improve in terms of structural geology, especially on the west fault. That's important because we believe that there's a potential even to find another slice of FDN along the west block. Because in the case of the west block, the west margin, there is a sharp contact. We just lose the mineralization. In the east, there's not. We have the intrusive body, right? The hydro temptation decreases a little. We don't know what happened on the other side as well.
Just quickly, just 'cause we have you here, Andres. If Ron gave you $5 million-$10 million more dollars, you've got a lot of targets at different stages.
Yes.
What excites you the most being the exploration guy? Whether what target would you think we need to spend more money, whether it's bang for your buck, more potential upside, out of the stuff you have looking at?
Honestly, in the short term, I think that we should continue to explore the extension of FDN, especially to north. Right? Actually, we are limited by a environmental license that should be released soon. The structure that hosts Fruta del Norte, it still continues to north as well, and we have already recognized this with soil anomalies and things like this. Similar as we are starting to see the south. For example, we started to understand that maybe Bonza Sur is a new system, different than Fruta del Norte, but it's also a new system. The last holes that we are starting to interpret and to understand show to us that soon we will be able to individualize Bonza Sur. This structure is to continue to south.
I think that we need to focus this fault, whatever happens. I think that that's our future in terms of exploration.
I think Ron would agree that we don't limit Andres' budget.
No. That wasn't the point.
We just have one question online from Don DeMarco at National Bank. "Andre, what's the approximate drilling cost per meter for near mine versus regional?
The average cost between-
Near mine and regional.
Near mine. In the near mine, our average cost, our cost per drilling in the near mine is around $390 per meter. In the regional, it's like $500, around $500 per meter.
All right. Good morning, everyone. Up until now, we've heard what a fantastic story there is for Fruta del Norte on the exploration side as well. I think we all recognize that where we operate is also critically important. For the next few minutes, I'd like to take a step away from Fruta del Norte and to share with you all a bit more about the context in Ecuador at the national level and also at the local level. We'll start with a little bit of political, economic, and mining-specific landscape. I think most of you who follow Ecuador will have known that over the past few weeks, the president has taken a fairly drastic action, something called Muerte Cruzada in Spanish. It means cross-death. It is a fairly dramatic move. It is constitutional. It has never been used before.
What it means is that both the presidency and the National Assembly have been dissolved. What that implies is that there are new elections coming. There will be elections on August 20th for the presidency and for the National Assembly. There would then be a second round in October for the presidency, if required. As you can see in one of the other boxes, with the number of candidates that have already declared, it was eight when we prepared this slide, there are several more now, there is very likely to be a second round for the presidency. These new authorities will be taking over, therefore, in November of this year and will serve out the existing term. It's about a year and a half that we will have a new president, because President Lasso is not running, nor is his party.
It would be new president, a new National Assembly. It is difficult to know at this point what the composition of the National Assembly will be, but they will serve for 18 months. We will go through the whole process again in May of 2025.
Why did they do that? Because that's when they would normally have the federal election.
Yes, that's the normal time for the election. This was not a total surprise. Leading into the declaration of Muerte Cruzada from President Lasso, there was concern that there would be a national strike, that there would be, again, disruptions on the street. That has not happened. Some of you may recall, 2019, or even more recently, last year, the CONAIE, which is the indigenous organization at the national level, they did cause significant disruption to the national economy through their protests. They had threatened to do the same if the president called for Muerte Cruzada. He did. They have not come out onto the streets, that's really because they themselves, as a movement, are fragmented. They have multiple leaders that are looking to stand for the presidency.
They have not yet determined which they will formally put forward. As a divided movement, they have lost some influence and ability to influence the direction of policy in Ecuador. In the meantime, President Lasso will be ruling by decree. He has retained his full cabinet. The cabinet is in place. The check on his power is the Constitutional Court. He has already started a process, this will run until the next president takes office in November, of issuing a decree. It's called a law decree in Spanish, and it goes to the Constitutional Court for approval. Assuming it's approved, it then becomes law. There, of course, is no National Assembly to pass any laws currently.
Sorry, Nathan, is the Constitutional Court elected or are they appointed?
It's appointed. It's appointed.
Appointed by the current government, then?
No.
By the previous government.
Well, multiple previous governments.
Yeah, yeah.
How easy is it for the new government starting in November to overturn anything he enacts?
It could happen. Those of you who follow Ecuador will know who Rafael Correa is, the former President currently based out of Belgium. He has been saying that he will be overturning some of the current government's decrees. I think some of the things that Guillermo Lasso is doing right now will prove to be popular, like lowering taxes, increasing competitiveness, and so I think that we'll have to see to what degree it's possible to reverse some of these actions. That will go through a National Assembly, not by decree, and so we will have to see what the National Assembly's composition is as of November. At the economic landscape, if we could only look at macroeconomics, if we only looked at macroeconomics, Guillermo Lasso would be much more popular than he is.
The macroeconomic picture in Ecuador is actually quite positive. GDP is up, public deficit is down. This is due to increased oil prices over the recent past, increased tax revenues, partially driven by mining. The macroeconomic indicators are really quite positive. The government has also prioritized free trade agreements. They're in the final stages of those with China and with South Korea, in earlier stages with Panama, Canada, other countries as well. His problems are really in that third box right there. He has focused on macroeconomic stability that is less tangible to people in local communities, investments in key areas such as health, education, infrastructure, has really lagged, he struggles to point to successes that impact people's lives on a daily basis.
His first decrees have already shown a bit of what he plans to do in these next six months, focusing on lowering taxes and promoting free trade areas. He's also moved forward some more innovative financing. multiple administrations in Ecuador have focused upon a debt for naturse swap. This government actually completed it with a focus on the Galapagos region. They have suffered a number of natural disasters. Flooding is ongoing on the northern parts of the coast. It does not impact our exports, but still is costing significant money to the government in terms of emergency response. There are some emerging and maybe less emerging areas of significant concern that need to be a focus both for this government and any government that comes in the future. Public safety.
The security situation in Ecuador as a whole has deteriorated, more so in some of the coastal regions, is linked to narco trafficking. Unemployment is a long-standing issue, unemployment and underemployment, and as you know, linked to the previous point, a deterioration in public service. In part, to address this, the president has declared the narco traffickers as terrorists. This is a legal maneuver. It allows the army to get more involved in responding to the public security crisis. It has not yet reflected, or maybe it is reflected, but that his efforts to address this are not yet reflected in the current risk rating of the country at approximately 1,900 basis points. We turn to the mining industry more broadly, both we as Lundin Gold and the Chamber of Mines of Ecuador, the CME.
We're in regular contact with the President, with his ministers. This is the most open government we've seen in Ecuador for quite some time, with respect to mining investment. There's also a core group of ambassadors from mining countries that seek to promote the development of the industry in Ecuador. We have regular contact with them, they are promoting the development of the industry on their side. Prior to the Muerte Cruzada, we were quite engaged with the different parties in the National Assembly as well, addressing key policies that they were promoting at that level. Of course, not a lot to talk about right now at the National Assembly, that will resume once the new assembly is in place. At the elections, there will be two natural resource-focused referenda.
One is focused on oil extraction in the Amazon region, the other is an anti-mining referendum in the municipality of Quito. Quito is, in terms of area, is a huge municipality, well beyond the confines of the city, for those of you that know it. This won't have any impact on the industry per se, but it is precedent, and so it is concerning both for the industry as a whole. Through the Chamber of Mines, we are actively trying to address this, but it is on the ballot, and I think many of you know how those ballot initiatives tend to go once the vote takes place. We will continue to watch that.
In spite of its fragmentation and reduced level of influence, the CONAIE continues to be adamantly anti-mining on indigenous land. Those of you who follow Ecuador also know that, the mining cadastre is closed, has been since 2017. The mining cadastre is a priority for the industry to get that reopened. It will also open the door to new investments. The government has made clear that they will not be reopening the cadastre until such time that there is a free, prior, and informed consultation law in place. It is still consultation in Ecuador, in a legal sense, not consent, as it would be in other countries. The prospect of that, especially without a National Assembly, is a bit more distant. The mining cadastre is very likely to remain closed for the coming foreseeable future. Echo?
Hi again. Does CONAIE share similar political views as Yaku Pérez's party? Are they connected in some way?
Used to be. They have split. Yaku Pérez is an indigenous leader. He is running, well, he's a pre-candidate because they can't formally register yet, so he is running almost surely for president, as are two other indigenous leaders more closely linked to CONAIE. The CONAIE, the political wing is called Pachakutik. That's the political party. They will be formally nominating their candidate soon. That link, that more formal link in the last election, he was running under the flag of Pachakutik. That formal linkage back to CONAIE is much more tenuous now.
How did these two referendums get on the ballot? What is the process for doing that? Is that just Lasso decides to do that, or there's some-
No, no.
Ministry decides, or?
This is people. Lasso is not behind this. There's two very different ways. The oil referendum in the northern Amazon has actually been sitting for seven years, and it was pending a Constitutional Court review. They finally got it to the review, and they approved that the question could be asked. That's been sitting in the background since, you know, since the Correa administration. The Quito referendum was a citizen-led initiative. They needed a certain number of signatures, which they validly got, now it's on the ballot.
Everyone gets to vote, right? Not just people living in the Amazon, based on whether they come to have oil exploration.
No, these are local-focused referenda. Depends.
Oh.
It is, it does depend. The Quito referendum. The oil one, it is national, I believe. I'd have to check on that one. Paying much more close attention to the Quito one, that is, for people who reside in Quito.
In Quito, okay.
Voting is mandatory.
The oil is national.
Yeah. Voting is mandatory in Ecuador. In spite of some of those challenges, as many of you know, there are two large-scale mines currently operating in Ecuador, ourselves and the Mirador mine, about 35 kilometers to the north of us. Between those two, primarily, mining continues to make an increasing impact to the national economy. For the first time ever, mining products have become the third most exported product in the country, displacing bananas only behind oil and shrimp. The impact of mining at a larger level is certainly being felt. There is, though, quite a bit of illegal mining and an increasing level of illegal mining going on around the country, and this has become a national security concern in some parts of the country for the government and for the military.
You've seen this picture before, what I did just want to highlight here very quickly, are the rings. Those of you who follow us would have seen reference in many of our publications to the different concentric rings. It focuses our efforts in terms of community investments, local procurement, local employment, on who specifically is being prioritized and in what order. We have a first ring immediately around FDM. This is the Parish of Los Encuentros. I will go into a bit more detail on the next slide on this. We have a second ring, which is the rest of the municipality, which you see in blue here. That is the municipality of Yantzaza. Finally, we have a third ring, which is the entire province of Zamora Chinchipe.
About 110,000 people live in the entire province, so fairly sparsely populated area of the country. We do include Ring four, but that's the entire country. If I spend a moment talking about the most local area, Ring one. It's important to note that just by the luck of geology and how Ecuador was settled, in our direct area of influence, there are no people. Originally, there were two. We did a formal IFC resettlement for those two people, even though they asked us to be resettled. There are no people living around FDN. When we talk about Ring one, we are talking about our area of indirect influence as legally defined in our environmental license. This is the parish of Los Encuentros, which has a parish seat.
I'll show you some pictures in a moment, but it's 22 other communities in the parish, along with two others you can see on the screen here. J ust right here, you have Payón, and you have Rio Blanco. These are not in the parish of Los Encuentros, but the only way to get to them is through the parish, so they are incorporated into our area of indirect in-influence and therefore part of our Ring One. I'll talk just briefly about the local political landscape as well. Subnational elections were held earlier this year, and in May, at the provincial, municipal, and parish levels, all new sets of authorities came in. They took office about 3 weeks ago. We will continue to work very closely with all levels of local government.
I met them for the first time last week when I was on site, and we will continue that. We also incorporate into Ring One, the Shuar Federation of Zamora Chinchipe from the entire province. The reason we do that is because they have historical links to the land in Ring One, not to the land, the operational area of FDN, but if we talk about Ring One, they do have a link to it. In recognition of that, the Shuar Nation is incorporated into the first ring. We have a very strong relationship with them. I will get to that in a moment. Illegal mining and lack of security is a national issue, but is a local issue as well, and has become the top priority in the recent elections for local people.
Since 2016, we have engaged in a process of participatory dialogue with local government and local stakeholders. Lundin Gold has not invented participatory dialogue, but we do this proactively. Normally, this kind of dialogue is undertaken in the face of a crisis, and someone tries to find a solution at that moment. We did this upon arrival, building up a system with local government, local communities, and we have met every six weeks to talk about issues of priority for local communities since 2016. The local government traditionally has run this over the past few years. With the changeover, we are now working with the new local government to understand their views and how they wish to push forward on this process.
Key issues that we will be discussing in this dialogue process, as they relate back to FDN, include things around heavy transport contracting, for example. This is a pretty hot topic around mining in many different jurisdictions, but definitely in Ecuador as well. Local procurement, local employment. This is an agriculturally driven economy around us, so our investments and what we can do with partners to address agricultural development is key, as is infrastructure. Another point I'll get to in a moment is just: how do we know how we're doing? We undertake a number of surveys throughout the year, and this is one of them. Some of you who follow this space will know that there is actually a formal academic methodology to measure social license to operate. Two Canadian academics have been doing this for years.
There is a Colombian-based organization that measures social license to operate for the mining industry in every country of Latin America. You can see here in this diamond-shaped figure, the model that is used. It really ranges from, you know, down here, where there is no social license, to acceptance or even up to approval. Just a couple of quick things to highlight. Ecuador is not doing very well at the national level with respect to social license for the mining industry. It is in last place. It is really on this threshold between having no license whatsoever and moving towards at least someone accepting the legitimacy of the industry. It's not even there yet. I will also highlight where Yantzaza is. Again, Yantzaza is a municipality where we are operating. The Colombian group does not go to Yantzaza.
We take their methodology, and we replicate it through a third-party survey. What we have found, this is not the first year we've done this, what we have found is that Yantzaza is at the approval level. It is, has a higher level of social license than any country as a whole in Latin America, and that includes jurisdictions with a long-standing mining industry. We also saw this improve significantly between 2021 and 2022. The key point here is that whereas social license is decreasing across the region, even in places with a strong mining industry, we are finding a very different situation in Los Encuentros and in Yantzaza.
Sorry, if you go back to that slide. That's the 2022. If you ran that survey today with the new parish governments, the municipal governments, do you think it would be similar, better, or worse, like?
I think it would be similar, and we will run this again. We do this every year in the November, December time frame. This is December 2022, what you're looking at here. In six months, we'll have new numbers.
Also, too, Terry, this is across all citizens. This isn't just polling the government, this is polling all citizens.
Yeah, fair, yeah. Yeah.
The government really won't have much of an impact.
Yeah. No, I'm just saying, has anything changed with the new provincial or municipal governments?
They're only in place for a few weeks, so...
Okay.
On the illegal mining, when you say that's a priority locally, is that a general objection to it happening because of environmental concerns, or is it ingrained and, like, it's a desired?
I think you have to distinguish between illegal and informal.
Mm-hmm.
Informal mining, that is, in a strict sense of the word, it is illegal. There are no environmental licenses, there are no taxes being paid, there's no oversight. That's been going on or in Zamora Chinchipe forever, basically. What has changed is the illegal mining, which in that sense, it means the infiltration of narco-trafficking gangs into the area, and using that mining activity to launder money. What that has done is it brought a very different type of illegality to the area, something that's never been seen before. This is in Zamora Chinchipe, fairly distant from where we are, but it is a political issue as well, that have some of the insecurity issues are being seen in Yantzaza.
Okay. Similar to what the dynamic is in Colombia, informal being ingrained in the culture.
Yeah
... the illegal activities sort of infiltrating.
Prior to working with Lundin Gold, I spent a number of years in Colombia, I would say that unfortunately, Ecuador is moving down that path. If we look at this, then the question is: Why do we see such a drastic difference locally than what we see nationally or regionally? I think it has a lot to do with what we've put in place since our arrival. Lundin Gold has currently a five-year sustainability strategy. 2021 to 2025 was put in place to for the transition from construction to operations and for those first five years. We had a different strategy focused on construction. I'm not gonna walk you through all of this. The key is that we have eight pillars that cover quite a bit of ground.
You'll see that there are a number of aspects to our sustainability strategy, not within my team, not managed by me. This is a company strategy. It is taken on by the full senior executive team. We also have a number of pillars. I'm sorry, enablers of success that I'll go through a couple of them quite briefly. You all have seen this slide in our corporate presentation. Ron's given this slide a number of different occasions. I'm not gonna walk you through all of this either. The key point is that for every one of the pillars, we have a set of KPIs. We are measuring progress, and we are ensuring that we are seeing the kind of progress that we want to see for each one of these critical areas.
I will walk you through a couple of them that I think give you a sense of what we're doing. I'll start with climate. What you can see here in the graphic is 2021 data. This represents 152 publicly reporting gold mines around the world. It is their greenhouse gas emissions intensity on a per-ounce produced basis. What this graph shows is that Fruta del Norte is the lowest emitting mine on that intensity basis in the world. 2021 data, that is a 0.07 tons of CO2 equivalent per ounce produced in 2021. In 2022, that 0.07 came down to 0.06.
While I can't replicate this yet for 2022, I can say with confidence that FDN remains one of the lowest emitting mines in the world on a per-ounce produced basis. This is a fantastic result. It's a fantastic story. It's based upon the hydro-based grid that we operate on, and also the efficiencies, some of the things that Terry mentioned in his presentation. We do, though, still need to move forward, and even in this context of being such a low emitting mine, we need to move forward and be clear about what our targets are. Very recently, we issued our most updated climate change report, where we talk about our specific target.
We will be carbon neutral by 2030, with respect to our scope one and two emissions. That is based upon our current life of mine plan. With that commitment in place, we now need a credible pathway to get there. Again, Terry mentioned some of the decarbonization initiatives. Terry presented them in a different context, but they do have an emission reduction impact as well. We will, though, especially given where we're located on this curve, we will be looking at an offset strategy. Certainly, we all recognize some of the controversies around offsets. We will be looking to have a very robust, top quality, offset program. We are doing this in partnership with the Lundin Foundation. Again, you've seen versions of this map in the past.
You can see where Los Encuentros is here versus Loja, which Terry mentioned, and Zamora, which is a major, the closest major city, the capital of the province. I do want to show you what it looks like, not on a map. This is Los Encuentros. Any of you, I'll scan around here a little bit. Any of you who have been to Los Encuentros, maybe you came to one of the early visits, you may think, or you may notice that this town doesn't look the same anymore. The level of development, the infrastructure that has gone into Los Encuentros, directly driven by Lundin Gold and also with local government, is incredible. When I compare this picture to my first visit in early 2015, it's like a different community. That's the parish seat. That's the town of Los Encuentros.
There are 22 communities in that parish, and as you can see here, especially if I zoom in, this is the Pindal community, which is along the north access road, much less development. We have not single-handedly eradicated poverty in the past eight years. We've made significant inroads, and there's still quite a bit of work to be done. What kind of work are we doing? A couple of examples here for you. One is the Estamos Conectados program, We Are Connected. This was in response to some of the challenges faced by the local school system during the pandemic. We put in place, together with a coalition of partners, including banks, including legal firms here in town, in Quito.
Many of the companies that have worked with us on the development of FDN contributed to this. This was to provide internet connectivity to every one of those rural communities. Today, Los Encuentros, it was, I believe it still is, the only rural parish in all of Ecuador that is 100% connected to the internet. I must say, Mona and I, we've gone to visit some of these far-flung communities, and we have streamed a soccer game in these local communities. It's better internet than what I have in Vancouver. It is very high-quality connectivity, and in all seriousness, what that allows is for these communities to be connected back to the school.
We are training teachers with the local university to make use of this infrastructure, we are ensuring that the teachers and the students are remaining connected, which is a real problem in rural Ecuador. That only works if the students are also connected. A key part of this initiative was to donate tablets to every students in the parish. When we started this program, one of the big challenges we identified was that in many families, there is one device. It's a phone shared amongst many children, that phone is not normally at home. It's with the mother or the father when they are working. The only way to make this work was to ensure that every child had their own, their own way to connect to the internet. This continues on.
It's a significant investment, and this will continue on with our partners. There's a YouTube video if you're interested. When you download the presentation, you can take a look at this. Very nice demonstration. Now we're in Yantzaza, and what we're looking at right here is the Yantzaza Hospital. This was also. It's fairly new infrastructure. This is about 25 kilometers away from Los Encuentros. This is relatively new infrastructure built since the arrival of the mining industry. What it did not have was an ICU. Again, in partnership with a number of key other parties, in this case, with SolGold and with Newcrest, the initial impetus for this was the pandemic, to address some of the inability of the local hospital to address some of the pandemic-related illnesses.
We built this with the government, with the Ministry of Public Health. This is a $1.3 million investment. It does, of course, serve our interest as well. Prior to the construction of this ICU, any serious case at FDN would have had to go to Loja. Now, there's something much closer with this kind of capability. Now that the pandemic is over, we're seeing this, of course, this emergency room is being used for a whole range of other issues, and it's primarily benefiting local people. The people from far outside the area are also coming into the city to for critical care. The work we do around healthcare is not limited to infrastructure.
In Los Encuentros, there are a number, as we've seen, a number of far-flung communities, and they struggle to get access to the state-run healthcare system. Vulnerable communities, vulnerable people, the elderly, indigenous groups, they are unable to get to the centralized healthcare areas, and so we work with the ministry to ensure that doctors are getting out to these communities. It's a fairly simple project. We provide the logistics. It has a huge impact in terms of ensuring that rural vulnerable people have access to healthcare. You can see, we're reaching a lot of people. These doctors are treating on average, 1,000 people a month. I mentioned agriculture. I'm not gonna spend a lot of time here, but this is not philanthropy. This is strategic for Lundin Gold. Why would I say that?
It's because there's an incredible expectation that Fruta del Norte will create local jobs, which we are, but we can't create a job for every person in the province, which when I arrived, was explicitly stated as the expectation. If we don't take action to further develop the local economy that preexisted us, we will create tension, and we will have problems. We do invest outside of our area of, you know, direct impact, outside of our local procurement in the existing economy, which is agriculture. We have a whole series of different initiatives here. Just note a few of them. Takate is getting local farmers integrated into the catering system, the catering company, and the catering processes we have at FDN. We're developing integrated model farms to ensure better farming practices at the local level.
We have a long-standing program around vaccination of livestock that was previously impeding the ability of any of the local products to reach a national, let alone international, market. We work with cooperatives, one of which is APIOSAI, long acronym. They produce coffee, plantains, cocoa, and we work with them. They are selling internationally now. It's, again, an effort to try to ensure that the benefits of our presence go well beyond our direct areas of impact. This is the Shuar Cultural Center. What I realize those of you who haven't seen this is in a fairly remote location outside the city of Zamora. You can just get a sense of what the territory there looks like. This was a project that was initiated by Kinross, but not completed when they decided to leave Ecuador.
We have completed this and greatly expanded it. This is really all part of how we wish to engage with indigenous people around us. This is the Shuar Nation. There are other indigenous groups in Zamora Chinchipe, but they are not from Zamora Chinchipe. They have come there over the past 20-30 years. If we talk about ancestral land, we are talking about the Shuar. From our arrival, we developed a framework agreement with the Shuar that has been renewed on multiple occasions. That sets out how we will engage with them, and it lays out the framework for specific investments. Really, the Shuar in Zamora Chinchipe, they want everything that every other community wants as well. They want economic development, jobs, education, but they also want to protect their culture and their language.
Again, we worked on that project that Kinross had started. It is now a museum. It is a meeting center. There is a shaman that is on staff, and they are selling tourist packages to domestic and international tourists to experience the Shuar culture. There's not a lot of tourists in Zamora Chinchipe normally, so this is a fairly challenging business to get off the ground, but it has shown good signs of growth over the past few years. They had some, as a Shuar Federation, some really basic challenges. No place to work, no offices, no computers, no ability to really act as the indigenous government that they are meant to be. We worked with them on a number of infrastructure issues, specifically with the Shuar Federation.
You see a picture there, just of a recently refurbished office block. We work with their farmers. They are traditionally farming communities. We do have Shuar that work at FDN, but many of the people in the Shuar community continue to work in agriculture. We, you know, provide technical and financial support, especially around cocoa, which is a traditional product. I mentioned, you know, that we were working outside of where we have direct impact, but of course, we're also working where we do have direct impact as well. Local procurement is an area where we can make a huge difference relatively quickly. You see here some numbers for local procurement for the past few years in the province of Zamora Chinchipe. 90% of these numbers are from the municipality of Yantzaza.
Just to put these numbers in context, prior to entering into construction, Yantzaza's annual GDP was $60 million. While these numbers may not be directly comparable, $37 million of local procurements in a year, in a GDP of $60 million, is a huge impact. This is not an exercise of going to the community and just finding a company to be our supplier. If we had started this process by saying, "Who in Los Encuentros in Yantzaza is qualified to be our supplier?" It would have been an extraordinarily short list. We have to create companies to become our suppliers. This is something we do with the Lundin Foundation. It has been ongoing for a number of years. You have up here three examples just from 2022. A company was created.
This was a number of women, only one man in that company, that were. They had their sewing machines, they were put together into a cooperative. They all agreed on the structure, this company is now producing our shirts at the site, our jeans, towels, sheets, things along those lines. They produce all that locally in Los Encuentros. We have a company that does cleaning, pest control, sanitizing. There's a company that does fire extinguisher maintenance, which has proven to be a very attractive business for a local company in Los Encuentros. We also have a specific focus on women and women entrepreneurs. Initially, this was in two separate programs. We were working on something called AWE with the U.S. Embassy in Ecuador, separately with the Lundin Foundation, something called Soy Emprendedora, which means I am an entrepreneur, a woman entrepreneur.
Each of these was ongoing. We have since combined them. In 2022, a second edition of these programs, but now combined, was launched. 27 women went through the AWE training program, again, run by the U.S. Embassy and the Quito Chamber of Commerce. They've gone into Soy Emprendedora with the foundation, which continues training, but also provides seed financing to the most promising of these businesses. You can see some of the AWE graduates in the picture there.
The recognition of Soy Emprendedora.
Oh, yeah. Thank you, Ron. The Soy Emprendedora program was just recognized as one of the leading examples of meeting one of the UN's sustainable development goals in Ecuador by the UN Global Compact. Yeah, thank you. We have a whole pillar of our strategy around human rights. I'm not going to go into great detail on that other than mention that we do have an IFC-compliant grievance mechanism in place since 2016 at FDN. We receive complaints from individuals, from organizations, institutions. It can be given anonymously, and it can be given in English, Spanish, or Shuar. It can cover anything that has to do with ourselves, our contractors, or our subcontractors. Any good grievance mechanism is an early warning system.
It is an ability for us to understand what is going on in local communities and have a credible way to address it prior to it blowing up into something more significant. This has been a quite successful program. Over the past few years, we've had hundreds of complaints. Almost 99% of them are very low level that we've addressed through this. That's what we want. We want low-level complaints to be addressed before they become something more significant. I talked a little bit about participatory dialogue and what we've done with the local government. A lot of participatory dialogue exists, and it tends to be very reactive. That's not what we wanted in Los Encuentros. We put in place a process that is proactive, it has a neutral third-party facilitator, and it is truly multi-stakeholder.
It is local government, national government, ministry representatives participate in these dialogue roundtables, NGOs, universities, indigenous groups, local leaders. We don't run this. That's another key characteristic. We do not control this process. We participate in it. Each one of these roundtables, you can see pictures of what this looks like, has a roadmap, and people are coming together to address a very specific issue. Critically, it also includes our senior managers at site. When we are addressing an issue, it is a credible person from FDN that is addressing it with the community. In spite of pandemics, those of you who have been following us, several bridge issues in Los Encuentros, several elections, this structure has proven quite resilient. For more than seven years, we've been doing this.
When I met with the local government last week, they confirmed they want to continue on with this process. Just to give a sense of what we're talking about here, we convene seven times in 2022, and we had an average of 147 participants across five roundtables. In a very small community like Los Encuentros, and this focus primarily on Los Encuentros, that's quite a significant level of participation. Everything I talked about could not be achieved without our partners. To state the obvious, we are a mining company. We do not have the expertise to be addressing all of these different issues on our own, we do this through...
This is just a portion of the partnerships that we have as Lundin Gold with the national government, with local governments, with universities, with NGOs, with industry organizations, amongst others. Communication to all of you is a key enabler of our success as well. We have just recently issued our 7th sustainability report and our 2nd climate change report. You can find both of these on our website. That's not the only way that we communicate with key stakeholders. We have a very significant social media presence as well. We have over 100,000 followers in Ecuador on our Facebook account, and close to that on our LinkedIn. In the context of the Ecuadorian market, that's a very significant level of engagement through social media with key stakeholders.
I did, though, also want to talk about economic and social impacts due to our presence in Ecuador. We undertake an annual economic study, and we've also, we did an initial census-level social baseline in 2015, which we updated. What does that mean? That means that we can follow a specific family from our arrival in 2015 through to today, and we can identify what has changed for a specific family. I'm going to start with some more, you know, higher-level, more macro-level statistics. What you're seeing here is our contributions to our local procurements at the national, provincial, and at the municipal level.
These are very significant numbers from both the context of the Ecuadorian economy, which is approximately a $100 billion economy, and I already mentioned the Yantzaza's economy at $60 million prior to going into construction. These numbers are quite impactful. Zamora Chinchipe was one of the first provinces in the country to recover from the pandemic, if we speak about sales. This is not one or two companies that somehow have gained huge contracts. We have 30 different economic sectors at these levels, linked to our operations at the end. In the province of Zamora Chinchipe, there are hundreds of local companies that have had a commercial relationship with us. We project that over the life of the mine, we will be having a $1.1 billion impact through our local procurement in the province of Zamora Chinchipe.
We talked about GDP, our 2021 contribution. This is our 2022 study. Our 2023 study, it will be coming out in a few months. Look, a 0.5% impact on national GDP is not insignificant. With a 0.5% impact, we may not be changing the lives of every citizen in Ecuador. We are, though, changing the lives of citizens in Zamora Chinchipe and Yantzaza. We represent 37% of provincial GDP and 85% of municipal GDP. Our presence has fundamentally changed these economies. We project that our contribution to GDP over the life of mine will be between almost $8 billion and almost $9 billion. This translates directly into government gaining resources to address some of the issues that we've mentioned previously.
Our contribution to the state, again, this is a 2021 number, though, in terms of reporting, because some of these payments were actually made in early 2022, and again, we'll have updated numbers in a few months. Our 2021 contribution was approximately $130 million. Very significant amount of resources provided to different levels of government. That means Lundin Gold was in the top seven nationally in terms of private companies and their contribution in terms of tax payments in 2021. We project between $1.3 billion and $1.5 billion of royalties and taxes will be paid over the life of the mine. This, you know, according to existing and current legal framework, will have very significant impacts locally as well.
Between $120 million and $142 million will come back to Yantzaza. That's over and above the $40 million-$44 million, again, life of mine numbers, that we will pay to the municipality directly. I think we've got the wrong direction there. Yep, sorry, apologies for that. Okay, in terms of social impact, how have the lives of individual people in Los Encuentros changed? You can measure poverty by different, by different systems. One is just income-based. What are family income levels in Los Encuentros? Another is by unmet basic needs, which is a much broader definition of poverty. Looking at income-based, over just three years, we saw an 8% reduction locally. Again, there's plenty that still needs to be done, but that kind of change in just a few years is rarely seen.
Over that time period, only 5 out of 24 provinces in the country had any reduction, and the other 4 had reductions of 0.1%, 0.2%, 0.3%. To have this kind of 8% reduction is unprecedented. We see a similar type of dynamic when we talk about unmet basic needs. Again, the same time frame from 2019 to 2022, 7%, approximately, reduction. We think about the Amazon region, which is the whole eastern part of the country. Traditionally, one of the poorest, least developed areas of Ecuador, Zamora Chinchipe now has the lowest level of poverty measured in unmet basic needs in the entire Amazon region. To put it a different way, Zamora Chinchipe traditionally has been the second poorest province in the country, only behind another Amazon region.
In about five years, it has become an average province. I mean, that kind of huge progress in such a short amount of time is really unprecedented. Driven in part by significant community investment that we are making with our partners, $31 million over a six-year period, and includes the work we're doing with the Lundin Foundation. Very concretely, this means more employment for local people with us and with the kind of economic activity we are generating. Higher income in specific households, and that's again, directly or indirectly linked to mining activity. We're seeing increases in the levels of education. Again, over a very short period of time, a significant bump in the average level of education in local communities. Reduced dropouts, an incredible increase in the level of access to university.
Greater access to the basic services, better infrastructure. Surprisingly, very little in-migration. We are not seeing population increase around the mine other than natural, population growth. As I mentioned, global indicators are closing the gap with national averages. With that, I'll hand over to Ron, unless there are any questions.
What is the population of the parish itself?
Parish itself is about 5,000, but that's the, that's the entire 22 communities. The parish seat is about 1,400.
And then the next-
You have Saza, and then the next ring, including, would include ring one, is about 25,000.
25,000. Then the whole province.
Is about 110, 115. Yeah.
Okay.
How many people are on your team that oversee and help with all of that?
I have a team of 30 people, but not only looking at this. We call business sustainability, it's external affairs and a number of other things. 30 people are government relations, external communications, artisanal mining, and community engagement. The biggest of those, community engagement, that's probably about half the team. Bryce?
Coming back to your first, one of your first slides anyway, on, GHGs, and then, GHG curve. Given where you are on that curve, could you be carbon neutral sooner than 2030?
Well, our commitment is to be carbon neutral by 2030. If we can be before, we will be looking at that. It's, it's... We do have to establish a very strong offset program, because given where we are on that curve, we have some emission reduction opportunities through the work that Terry is doing with our climate resilience group at the end. But that's going to be fairly limited because you can do lots of things, but when you're already that low, you're not getting a lot of emission reductions from those activities. We do need to have an offset program. It needs to be robust, it needs to be credible, and that's gonna take a little bit of time to build up.
The 0.06 tons per ounce, is that mainly from the mobile, the equipment mobile fleet?
Yep.
Yeah. For stroke one. Yeah, stroke two is for electricity.
Is mostly hydro, but not 100% hydro.
Okay. You.
Frederick?
Just going back to the election, like, it seems like at a national level, probably Correa's party is set to take over. Is there any indication on what the consideration of his party is looking at mining from a policy perspective?
that's a good-
Careful, you might get retweeted like I did.
Say it again?
Careful, because you might get retweeted like I did when I said something.
It has not been a key area of what Correa has been speaking about right now. You know, mining has become more politicized at the national level, but as we've seen in these numbers, it's also become a key export product. In a dollarized economy, exports are essential to bring those dollars to the country. I think that there's in terms of existing mining, any party that wins, Correa included, will need to work with the industry. Correa when he was in office, had a real change of heart around mining. When he started in 2007, he was really more anti-mining. Then, over that 10-year period, he put in place a number of policy changes.
He modified the taxation and regime, allowed the industry to take off. I think he came to Fruta del Norte. He saw the Fruta del Norte in construction, I think that really was impactful, and I would hope that his position would remain the same.
Would Lasso's party likely to rerun again in 25?
Maybe in 25. Yeah, they're not running in this. It's just a reflection of reality. The chances of anyone associated with Lasso getting reelected in November or, well, in August, and then October, in the two rounds, is extraordinarily small. I think Lasso is looking to protect his legacy and the longer-term legacy of his party. He can do a lot in these next six months, and hopefully, that will bear fruit in time for 2025. Yeah, from his perspective, that's what he would do.
Thanks, Nathan. Well, I think going full circle, coming back to the four pillars, you've really been able now today to hear from each member of our team as to what we're doing in a lot more detail in each of the four pillars. To make, I think, Lundin Gold a great opportunity for investors, there's a lot of upside yet. You know, Ecuador is exciting. The exploration we've got, the work that we're doing on the social front shows that why we think Lundin Gold is a great investment. On closing, I think one of the things is to think about Lukas and the vision he had in 2014 when we went to Fruta Ecuador for the very first time. You know, Adam, Harry's here, and he had a vision.
I remember the first meetings we had with Marisol and Poveda, and he explained what mining can do for an economy. We said, "Well, it's like oil." No. Mining can have a much broader impact. It was interesting, Nathan's son yesterday asked, what was that chat.
ChatGPT.
ChatGPT, about responsible mining and Lundin Gold. It was scary, actually, what ChatGPT came back with. It was bang on.
Yeah.
I think the team here has done a great job, to, the operations-.
questions throughout the whole session, but I guess this is an opportunity to ask any more questions, if any of you have them. If not, obviously, we'll be sticking around afterwards to have a chat with anybody who wants to. Are there any questions?
Just on throughput, I think at the beginning, Ron, you mentioned there's upside to the 4,400 tons per day, and that you'd be going out with something a bit more than that next year. Then we kind of jumped straight to the 5,000 tons per day, which looks maybe longer dated. What are the internal targets for throughput in 2024? Is it somewhere between 4,400 and 5,000?
We're looking probably closer to, say, $45 for 2024, is where we're looking at right now. We're just starting our budget cycle. Price, and that's where we think we can get there, where we keep pushing the limits. We keep pushing, everyone keeps trying to see what more can we do, and but that's kind of where we feel we could probably run through in 2024 easily.
Thank you.
Yeah.
You touched on it, but just very topical right now is the Newcrest block. Can you maybe elaborate on sort of some different potential outcomes you see there, or statements?
Yeah, it's. Look, it's, we've seen more and more information coming out from Newmont as to, you know, all the assets that they're gonna have in their stable after. We kind of sit in that middle block. You know, are we? We're not core, we're not non-core. We're kind of, they're not sure yet where we sit. Look, we've got to just keep charging forward and doing what. We're looking at M&A opportunities. We're obviously pushing the growth. You know, what Arun said is, "What if he had more budget?" Don't worry, we're the ones actually pushing him to add rigs on a regular basis.
You know, in terms of what happens with that block, again, it all comes back to we have to focus on shareholder value, that we control the things that we can do, keep trying to do things, whether it's operations, exploration, or things that Nathan's doing, that we got strong community support. Whatever happens with the Newcrest, with that block, whether it's up for sale or Newmont decides they're gonna buy us, we want to make sure that for all shareholders, they're gonna pay maximum dollar. That's really, for us, that's what we focus on. Yeah.
I think you addressed this in the beginning, but do you think that you if you found something you wanted to buy, Newcrest might make you wait until the deal is closed? Do you think, based on the relationship and the understanding of the pending agreement, Newcrest does have the okay to approve something, because the end of the day, it's not that big to Newmont in the big scheme of things?
That's a great question, and the answer to that, we've specifically asked that, and they said they are not gonna get in our way. There supposedly is a clause directly in the agreement that Newcrest, as we say, with regards to anything that happens within Monument Gold until the transaction is closed. Newmont can't come in and say, "Hold it." That's not business as usual, but there's a specific clause in the agreement.
Maybe, Terry, when you talked about the grade declining Q2 to Q4, will it sort of gradually decline quarter-over-quarter, and the lowest grade quarter will be Q4, or does it kind of just drop down and runs flat for the last nine months?
It's projected to be pretty flat over the course of the year.
Okay.
Yeah.
Thank you.
Yeah.
Yes. Andre mentioned one of his favorite targets is north of FDN to the deposit that is in license right now. What's kind of the timeline on getting licenses, and is that obviously stalled with everything that's happened with federal government?
That has continued to move ahead. We've kept moving that forward, and we've got Actually, the whole consultation process was just approved, right?
Yeah.
Now it's essentially the paperwork.
Yeah. That's one of the bottom months into half the license.
That's something new, because I can remember back in the original due diligence and everything like that, and we've always had this philosophy, and I'm sure Jorge and I've talked to Andre about it, that there was fault there, Fruta del Norte is cut off to the north. That's always been the thought, but Andre and the team are re-looking at it and thinking, "Oh, that's maybe not necessarily the case.
In terms, just to be clear, timeline of that, you could be drilling it maybe by the end of this year?
Yes. We would like. We are planning for this. It's part of our exploratory targets as well. As I said, our plan in the next... we do have a three-year plan for the near mine, right? What we expect is to define the most potential targets in the first year, so by the year end. In 2024, start to define the mineral resources and start to convert this maybe by the year end or in 2025. It would, it will address exactly when we would convert most of the infinite resources that we have in our current base. What we do expect, honestly, I personally, I do expect it to be able to start to deliver new reserves, for example, in 2025, from new targets outside FDN.
We also have opportunities, for example, extend FDN, that's close to the, to the mining infrastructure, so we can also keep adding new reserves and resources inside FDN. We have a very aggressive plan, where maybe next year and the year after, we're gonna have resources and reserves coming from new target. If the resources and reserves are there, but that's the plan now. That's the strategic plan.
Bryce?
I was just gonna ask if Newcrest, going back to Newcrest again, has their exploration spend on the earning properties or packages changed at all as a result of Newmont, or is it?
No, they're completing their budget that they had, right, Chester, that they had for this year, which will put them at the point they will meet the earning obligations, that they can take 25%. Is that right?
From a cash perspective, they've met it. There's a notice requirement that they've sat on, intentionally, just because it affects the timing of the start of stage 3. They've got the benefit of time...
Right
... now to not formally complete, stage 2, although financially, from a cash contribution perspective, they've met that requirement.
Okay, their earning behavior hasn't changed at all?
Not that we've seen.
Okay.
Yes, Terry?
Chester, what is the timetable to start talking to the banking syndicate about restructuring the debt into some sort of corporate facility? Like, is that something that will happen this year or next year? Or, like, how will that play out?
I mean, we've had preliminary conversations already. You know, ideally, while there's a substantial amount that remains outstanding and they're, you know, they're still obligated as part of that, you know, with a larger amount, they're more incentivized to sit down, and have conversations as opposed to when it's starting to get quite low and they potentially see the exit right there. It's something that CK and I will start working on with them. You know, largely, potentially in conjunction with any sort of possible M&A that we might be doing, and then looking sort of at the cash needs associated with that as well.
That's the existing syndicate.
Correct.
Okay.
Yes.
Okay, thanks.
Maybe for Terry, when do you see the southern extension getting sequenced into the mine plan?
That's a good question. It's been. I didn't really get into it in my discussion. The south exploration decline that Andre highlighted, that's something that, you know, based on results, we'll dewater and rehab and get some rigs down there. We're already starting to evaluate how we would connect that to the rest of FDN. There's some ramps, and there's some different combinations that the team's already looked at. We'll just stay nimble, and as the exploration story comes together, we'll just look at how that looks. We have to extend that one level off to the south further.
It's 1,170 drive?
Yeah.
Does that touch the ore yet, that drive, or is it just a drilling-
It's just a football drive, yeah. Yeah.
We'll have some of the southern extensions now in the reserves in the next life of mine plan, right?
Yeah.
That's more of the blue sky.
Yeah
that Terry's talking about with regards to that ramp. We did dewater that ramp in 2016, I think it was. We determined, once we made the decision we were going with the double decline, we stopped.
That was the Kinross exploration ramp?
Correct.
Yeah, that was in pretty bad ground, wasn't it?
Yeah, it's not in great ground. Yeah, when we dewatered it wasn't looking great, so yeah, it'll take some work. Yes, Terry?
The conversion drilling, I think, was 11 or 12 million dollar budget this year?
It has-
This, pardon me, the near mine, the near mine program.
Yeah, near mine.
$12 million?
Almost 11.
How much of that is expansion versus conversion of?
Zero conversion.
That's-
They're two totally different programs.
Okay, how much is being spent this year on conversion of resource-?
It's $1.8 million?
Yeah.
How much, sorry?
$1.8 million.
$1.8 million, okay.
That's within sustaining capital.
That's in sustaining.
Okay, thank you.
Ron, you just mentioned new mine plan. What's your thinking on timing for that? Because there's lots of things that could be incorporated into it, including potentially.
We normally work in the, we've started our budget cycle now, so that'll be part of our, we do, our 2024 detailed mine plan and then a new life of mine plan. That'll all be, Q4, start of Q4.
Okay, we might see it early next year then?
Possibly, yeah.
The southern extension's always been thought of as lower grade, but some of the more recent drill results look better.
Yeah.
Is there a reason that the drill results look better, or do you still think of it as lower grade?
Yes. No, I don't think so. I think that it's amazing because Fruta del Norte is like two different deposits. The north and central, that's like a breccia zone, and we have the 150 meters, 100 meters. As soon you move to the south, you will start to enter in a typical epithermal system, vein, like 10, 15 meters vein inside, highly disseminated mineralization on the volcanic rocks. Remember that the last, when I presented about the Fruta del Norte, I said that the southern extension had volcanic mineralized rocks and breccias in veins.
Mm-hmm.
That's the point. The problem is that the entire deposit was defined by 150 meters. It worked for the north and central part, but for the south, it's too much wide. As we are starting to increase the density of drilling, we have been able, for example, to define higher-grade zones inside this lower-grade envelope. Now, honestly, we are now starting to evaluate the entire south extension because we believe that we can start to define higher-grade zones inside the southern extension. It could be mine, could maybe higher than the current grade that's 5 grams per ton. We think that there is an opportunity even to work inside the infinite resources and start to define higher-grade results.
This is what I would expect from an experience in epithermal fields, you know, because that's a real epithermal deposit, especially in the south extension. We're starting to see things-
Okay
... better defined, while in the north, you only see a large breccia zones. That's the reason there.
That will continue, you think it's gonna continue to get better the more you drill it?
Yeah, I think so. I think so. I honestly, in my opinion, I think that we'll be able even.
... define some veins inside the infield and start to extend this along the south, as we are doing with the FDNS. I think that there is an opportunity to find parallel veins to FDNS, to the west direction. Never explored before.
Any other questions?
Just last one for me. Just, it's either for Nathan or you. On the political front, just like how do you and the business community kind of thinking about this whole re-election process? You kind of touched it all in the presentation, but I mean, Wheaton just putting up the $300 million, this was well telegraphed. It seems like you've had relationship with Correa changing, kind of the environment in general, but sometimes generalists or headlines can see Ecuador. Just maybe quickly, what you guys think about this process, how it might affect you or not affect you going forward? High level, 'cause who knows who's gonna win and whatnot.
Yeah, I don't think we see much of an impact as we're doing. As Nathan said, we're, there's still a lot of support for the mining industry. Nathan and his team have a plan in place to actually, I think you're going down next week, and we'll actually get started on meeting with some of the presidential candidates, start meeting with leaders of parties and that sort of thing. Rather than waiting until the election happens, we're actually gonna get out and start telling people what we are doing and what mining means to Ecuador, so that they come. If and when they get elected, they are, we're not coming to them then when everyone else is coming to them, you know.
I think the one thing is that, as Nathan hit upon, it's actually, you know, everyone's thinking, muerte cruzada, oh, my gosh, it's gonna throw the country into chaos. Actually, just being down there the last week or last time, I've been down a few times now since then, it's actually probably the most tranquil, quiet, calm it's been in a little while, actually. I think people feel a sense of calm and more certainty now with things going forward. Nathan, I don't know, do you have any more?
I think that the main dynamic over the past two years has been the opposition parties trying to get rid of the president, and that has consumed the entire political discourse. Now that, to a certain extent, they've achieved their objective, but they're also out of a job. It offers the president six-month window to move things forward, and I think that just the political bickering has really been toned down, because, well, we have to see what comes next. It has definitely been a calmer period, politically, now, since the Muerte Cruzada than leading into it.
How many decrees has he passed since he declared muerte?
There are two in front of the Constitutional Court now, and we hear that there are several more that are basically ready to go.
He's also been smart in the decrees he's put forward, which have been generally pretty popular.
Yes.
Good for the country. You know, in some respects, Lasso has an opportunity now to. It's been a really tough presidency for him, right? Because he never had control of the National Assembly, and he has the opportunity now to kind of put his fingerprints on, you know, his history, when he's going to be looked at, looked back at. Any other questions? Thank you, everybody. Really appreciate you taking the time. I think there's some box lunches outside, is there? None. Just stick around, and we'll be here. The full team will be here if you have any questions online. Thank you very much.