Good afternoon, everyone. Firstly, welcome, everyone. It's great to see such a really, really good turnout for Monday afternoon. It's also really great to be here gathered when the commodities that underpin our business are up 2%-3% today, especially silver up 3% or touched up 3%. We are very fortunate in that we have participants here in person and/or dialing in from New York, Los Angeles, London, Switzerland, Puerto Rico, Austria, Germany, and Australia. We also got very lucky as to the original date of our Investor Day would have coincided with the Blue Jays World Series parade, had they obviously pulled off the win. Not to digress too much, but again, what a series of all my years watching Major League Baseball. That was by far the best World Series. It was not even close. It had all the drama, as I think people know.
At the end of the day, as a fan of all sports, how could anyone not be optimistic about the future of the Blue Jays? In my mind, that's not too dissimilar to what we are experiencing at OR Royalties. I believe we're at an inflection point with respect to our company, our growth path that we're embarking on, and the shareholder returns that we hope to achieve. If there's just one takeaway from our next 120 minutes together, it should be similar to what most Jays fans should be feeling right now, and that's one of optimism. I do have to start and state that my colleagues and I will be making forward-looking statements today for which actual results may differ. Procedurally, we'd like to hold all your questions until after all of our presenters have the opportunity to come and present.
With respect to the agenda, we're going to try and be as efficient as possible with your time today. As you can see by this agenda, the bulk of our presentation will be focused on our key growth assets. Hopefully, after our 120 minutes together, if we've done nothing else, you should take away three things. Firstly, a better appreciation of our asset quality, the talent density of our team, and lastly, as I mentioned, the optimism with respect to our holistic business and some clarity of direction as to where this management team plans to take OR Royalties. Just quickly on the quality of our assets, my colleagues are going to spend some considerable time on three of our assets this afternoon. The first, as you can see on the agenda, Mantos Blancos. Second, with respect to our newest contributor, Dalgaranga.
Finally, with our cornerstone asset, Canadian Malartic. The second takeaway, as I mentioned, should be about our team. As you may have noticed, our team is very, very lean. 50% of our total headcount is actually here to host you today. They're around the room, and they'll be presenting. I think it's also important to note that the average tenure of this team is seven years, which is quite impressive when you think that the company just last year celebrated its 10th anniversary. In addition, myself and Brendan do bring down the average considerably, considering that we both joined the company just two years ago. Now that I'm looking at these headshots, either Elijah applied some exceptionally good face-tune program or these photos were taken the last time the Blue Jays won the pennant.
What I would say the team is incredibly proud of and what we certainly engender and I promote is accessibility. We are always open to meet with our stakeholders, specifically the analyst community, as well as all our shareholders and prospective shareholders. As you'll hear later from both Mike and Iain, this is also a team that our whole team manages risk on behalf of our shareholders. Real quick on our business model. As a mid-tier royalty and streaming company, we do have a highly efficient business model. As I say, if it's done right, it's the only business for which you can provide positive asymmetric returns for your shareholders. The model, as I think people know, is highly efficient. It's highly scalable. Right now, we have 22 producing assets out of an asset list of around 190, and it's growing.
It provides significant both asset and cash flow diversification. As you also know, with the royalty and streaming companies, there is no direct capital, operating, or exploration cost exposure. We are highly insulated from inflationary cost pressures. For ourselves, we are a very high margin business. As you may have heard last week when we reported our quarter, we have a 97% cash margin in the first nine months of 2025. While we recognize that there are no barriers to entry to set up a royalty and streaming company, and there are a number of new entrants, as I am sure everyone is aware, you think of the Zijin streaming company that set up the Lundin Royalties or LunR. I think they call themselves LunR at this point. I would say while the model may be easily duplicated, it is very, very hard to replicate.
Our Canadian Malartic asset is well recognized as the best royalty in the sector, for which I think a lot of you do know, but if you did not, was a result of a corporate action. It was a defense solution to a hostile bid. In other words, one cannot just go out and acquire a Canadian Malartic type royalty in any of the active processes that we and/or our peers are currently involved in. Canadian Malartic truly is a cornerstone and unique. Why OR Royalties? As I said, we have 22 producing assets with some of the best-in-class operators that exhibit both exceptional technical acumen as well as operational excellence. We are soon going to have 23 producing assets, as you will hear later on from Darren at Ramelius.
It is important to note that our top three assets are operated by well-established operators with a deep history of developing and expanding mines in a very responsible manner, those being Agnico Eagle, Capstone Copper, and Harmony Gold. We are a precious metal investment vehicle. 95% of our gold equivalent ounces are in precious metals. In fact, with silver trading, as I mentioned, over $50 this morning. For all those silver bugs, silver is a big contributor. I did mention in our conference call last Thursday that our third quarter, we had 30% of our GEOs in silver. We also have 84% of our mines in the top quartile or the top second quartile or top half or better in terms of cash costs. In other words, there are no ropey assets that only work during current commodity price cycles. How does one create value for shareholders?
In our mind, it has everything to do with consistent and predictable business strategy coupled with growth in both our operating cash flow per share and NAV per share. Despite some bumps in the road, our track record, as you can see, since inception has been pretty good. By the way, one of the governance changes that Norm, our Chair, who was here and myself made when I arrived two years ago, was instituting both a minimum share ownership structure for both our employees and directors, as well as restructured our long-term bonuses for the senior executive team. These long-term bonuses are directly measured against per-share metrics, specifically growth and operating cash flow per share, as well as NAV per share. As some of you would know, we host an Investor Day every couple of years.
I thought it would be helpful for the audience to contextualize what has changed since then. You can see the eight items outlined in which a simplified business model would be core to that. Our team developed a corporate purpose statement, which goes as follows: to sustainably grow as a pure-play precious metals royalty and streaming company which investors have to own. We've made huge strides in simplifying the business and turning the business around. We do very much appreciate the patience and support of our shareholders. One of the areas we are most proud of, and that Fred will be speaking to shortly, was the relentless deleveraging journey. Just for context, when I joined the company, we had approximately $300 million of debt. Today, as Fred will report, we have $120 million in cash and no debt.
This is an incredibly good place for our team to go out and try to bring more assets into the portfolio. That is on the internal side of the ledger. Those are factors that I say that we always can control. On the external side, I think a lot of you have a good grasp as to what we are seeing from a macro perspective. It is these factors, obviously, that have led to exceptional performance of gold and silver. One area, though, I would like to spend a little bit more time on is the situation that we are currently in on the global debt to GDP levels. You have a situation everywhere you look across the globe. Government finances are in absolute ruins. If you look at France, as its debt mounts, it goes through prime ministers faster than anyone can ever recall.
Britain faces big tax raises to plug a hole in its budget after welfare reforms were all but abandoned. In Japan's recent prime minister elections, it was clear they want to splash out despite the country's vast debt situation. That obviously all leads us to the U.S. or America and what I believe is an unsustainable deficit, which I'll speak to more to later on. For all the profile on publicity that you see in the U.S. capital markets situation, the Mag 7 or the Magnificent 7 gets the most out of attention mainly because you hear it being a bellwether for the economy. The Mag 7, which you can see is tracked here, obviously is part of a large concentration of many global portfolios. It's likely for the portfolio managers in the room part of your portfolio.
I thought it would be very interesting to illustrate if one were to synthetically create an index of all the six largest royalty and streaming companies, or what I call the Royalty Six. As you can see, for every $100 invested, if you invested at the Investor Day two years ago, you would have had a substantial return, in fact, in line with the Mag 7. If you did decide to invest in OR, it has actually outperformed the Mag 7 by nearly 70%. These are exceptional returns. They get very little traction or fanfare outside of our small, niche sector.
I hope events like these and the people that are here that obviously broadcast and advocate for our company in the sector can use this and, again, inform other folks, generalists and the like, to really talk about how our sector has done incredibly well and really outperformed global markets. I would like to take the opportunity also to talk about the confluence of macroeconomic factors that I believe sets up an incredibly constructive gold tape for many years to come. Here are a few stats for you. Today, the U.S. has $38 trillion of federal government debt burden against a GDP estimate of $29 trillion. That gives a debt to GDP ratio of about 125%. If you were not aware, this is the highest level since the end of World War II.
If one goes to New York, go watch a Giants game or something like that, and you go to the national debt clock, in New York, that debt clock is approaching $750,000 per U.S. family. It is substantial. This ratio has climbed steadily since the pandemic in 2020, where the federal government debt was just $20 trillion and GDP was $21 trillion. For reference, since the pandemic, the federal government debt has risen by 90%, whereas GDP has climbed 38%. Obviously, to keep the economy growing, the U.S. government is now running a near $2 trillion deficit. That's nearly 7% of GDP, while paying over $1 trillion per year in interest alone just to service that outstanding debt. These are facts. These are not opinions.
You've heard much smarter people than myself, such as Elon Musk, Paul Tudor Jones, Ray Dalio, say that unless hard actions are taken and behaviors changed in the U.S., it's headed for some significant headwinds and structural trouble. Coincidentally, all those people that I mentioned before, perhaps with the exception of Musk, are absolute raging gold bulls. In fact, Ray Dalio is advocating that all PM's positions, including his big fund, position themselves with a 10% allocation of gold and gold equities. Coupled with what we're seeing in a steady and sticky inflation environment from the large stimulus of money that central banks and the U.S. Fed, it has forced organizations to raise and keep interest rates high, driving up the cost of borrowing. The recent policy decision on, obviously, the U.S. reciprocal tariffs, I believe, are just going to magnify the situation. The big, beautiful bill is inflationary.
That, and you layer on the fact that central banks still want to diversify away from the U.S. dollar in the face of dollar weaponization. You have a scenario for which Chinese consumers are still very concerned about their economy, particularly in real estate and the safety of their banking system. In my opinion, the U.S. Fed will have to take a far more accommodative monetary position as the U.S. economy starts to slow down. We will see what Fed Chair Powell does this December. You layer that on to all the geopolitical unrest and the trend of reversing globalization. All this, in our opinion, leads to a very, very constructive gold tape.
Last thing I'd say is, for those that are not aware, gold actually reached an incredible milestone just a few weeks ago in that it has now overtaken the euro as the second largest reserve asset after the U.S. dollar. The right portion of the slide here, you'll see it in your decks, speaks to we just basically put a collection of core thematics at OR since our last Investor Day. We intend to address a big portion of these today. On the left-hand side are the group of our sell-side analysts, most of which are here today, or their associates are here today. Thank you for attending. We do want to acknowledge their effort and expertise. These publishing analysts obviously are conduits for which their respective sales forces, and we have some sales folks here today.
Again, thank you for coming to advocate both for the royalty and streaming sector, but also for OR Royalties. As you can see, the average target price from these men and women is over $61, which would imply a 36%-37% gain from where we opened this morning. Lastly, I want to acknowledge these analysts who have been with the company for some time, specifically Carrie, Cosmos, and Shane, who all initiated coverage when it was called Osisko Gold Royalties at the time, had one and only the Malartic royalty. I'm not going to take too much more time here because I'm going to let my colleagues come and present. Hang on. Real quick, we do have four differentiating factors or what we call differentiators at OR Royalties versus our peers.
What you'll hear from my colleagues and partners is we do have the best jurisdictional exposure. In fact, 80% of our NAV and cash flows come from Canada, Australia, and the U.S. We also do have the best growth profile. We've got a 40% growth offer base today. All that growth is actually bought and paid for. There is no contingent capital associated with a very solid integrity of growth over the next five years. As Fred will tell you as well, we have the best cash margins. You're going to learn a lot more about Canadian Malartic today because, as I said, I've been on stage when some of the larger-cap royalty and streaming companies, when they've been asked the question about what the best gold royalty is out there, they unabashedly and always come back to the Canadian Malartic complex and asset.
That was just a quick summary of our business. I'm going to hand it over to Heather, and she's going to talk about the sustainability considerations.
Thanks, Jason. It's so nice to see so many familiar faces out here today. And hello to everyone joining us live. We're catching the replay. For those I haven't met yet, I'm Heather Taylor, and I'm responsible for all things sustainability and communications here at OR. Before I do dive in, I do want to spend a moment to say thank you to Grant for coordinating and hosting us today. So thanks, Grant. Over the next few minutes, I'd like to share how we think about sustainability, how we integrate environmental, social, and governance considerations into our investment decisions, and how that framework helps us manage risk across our portfolio and partnerships. Sustainability is embedded in our business model. We don't operate mines, as you know, but we take our responsibility seriously as an investor and partner in the mining industry.
We are proud to say that as of November 2025, we continued to maintain leading roles with the ESG rating agencies. To call out one in particular, we're rated prime by ISS ESG with a corporate rating of C+, the highest in our peer group. It's not the kind of C+ you'd worry about in school. In ISS terms, it represents top performance. Sustainability isn't just about our portfolio. It's also about our people. In 2025, we were rated—oh, sorry, one sec. In 2025, we were certified as a great place to work for the second year in a row, with 100% of our employees who took the survey saying that OR Royalties is indeed a great place to work. A recognition that speaks to the culture we've built and the values we put into practice every day.
Our ESG strategy is anchored in five key pillars that align with many of the United Nations' Sustainable Development Goals: due diligence, ensuring our investments adhere to responsible mining standards; climate action, conducting business in a way that protects the environment; and where possible, helping our mining partners achieve their climate-related goals; social contributions, investing in the communities where we and our mining partners operate; health and safety, promoting well-being across our teams and networks; and diversity, equity, and inclusion, ensuring we embrace diverse perspectives, backgrounds, and experiences to ensure a workplace where everyone feels empowered to contribute their best. Now let's talk about how this plays out in practice. Every new investment goes through an ESG due diligence process. More than 50 targeted questions covering environmental, social, and governance factors are embedded in our ESG due diligence tool, which we formalized in 2023.
We apply this on a customized basis, adding and deleting questions where needed. Our internal team leads the process, and when needed, we bring in external experts to evaluate specialized risks or opportunities. I like to say that our due diligence is like a marriage. You want to know everything before you commit, not after. Our relationships with our mining partners do not stop with "I do." We continuously monitor our portfolio to ensure our mining partners maintain strong ESG commitments throughout the life of the investment. This just is not about values. It is also about financial discipline. In 2024 alone, we rejected over $350 million in potential deals, primarily because they did not meet our ESG standards. It is not always the easy choice, but we believe it is the right one for the long-term value and risk management of our business.
Finally, sustainability is also about impact, the positive difference we can make beyond the balance sheet. We focus our community investments on three key areas: education, social and community, and the environment. Since launching our community investment program in 2021, we've contributed close to $1 million to local and partner initiatives. In 2024 alone, that number was $361,000, over a 50% increase from the year before. We also introduced an employee donation matching program, which has been a great success. It amplifies charitable giving and builds a strong culture of engagement. On top of financial contributions, many of our employees also volunteer their time with organizations like the Canadian Mineral Industry Education Foundation, helping inspire the next generation of mining professionals. In summary, I was only given five minutes. Sustainability helps drive how we evaluate opportunities, how we manage risk, and how we give back.
At the end of the day, it is part of how we make a better call on what to back, who to work with, and what risks to walk away from. With that, I'll pass it over to Brendan to do a double-click on Mantos.
Thanks, Heather. Yeah, so I'm going to be talking to you about Mantos Blancos today. It's about 12 slides. Before we get going, I'll just give you a bit of background on myself. I work for OR International. I'm based in Bermuda. I'm a mining engineer with about 30 years' experience spread over operations, tech services, and projects. I've been with OR for about two years, and Jason and I worked together at—actually, I worked for Jason at Gold Corp a few years ago. Mantos Blancos. We really like Mantos Blancos. It's a fantastic asset. We wish we had more of these types of assets in our portfolio. It's owned and operated—for those of you who don't know—it's owned and operated by Capstone Copper.
It's located in northern Chile, and it's been in production for over 60 years, which really speaks to the quality of the asset. It produces a copper and silver concentrate, and we stream 100% of the silver at an 8% transfer price. Last year, it did about 10,000 GEOs for us, which is gold equivalent ounces. This year, it's forecast, we think, around about just a bit over 12,000 GEOs. There is a lot on this slide, but I just want to point out a couple of key points. I'll be talking to you about elements that, as it relates to my expertise. That is the story of Mantos over the last few years. Again, for those of you that aren't familiar with the asset, it is one of the challenges associated with a ramp-up from a 12,000-ton-a-day sulfide plant to today operating at 20,000-ton-a-day.
We'll go into some of those challenges that they had over the last three or four years. The last 12 months has really been about optimizations and steady-state production, so we can dive into that. Towards the end of the presentation, we'll be looking at the recently, or the messaged, expansion or phase II expansion, which is taking the project to a 27,000-ton-a-day. Where are we? We're in northern Chile. We talk about tier one jurisdictions and all the rest, but this is perhaps, if we wanted to choose where to put a mine, this is probably right up the top there. Why is that? Again, northern Chile, well, Chile in general is a great place to mine. Northern Chile is really a fantastic place. It's located about 50 km outside of, the mine is located about 50 km outside of Antofagasta.
For those who aren't familiar with Antofagasta, it's a town of around 300,000-400,000 people, and it's really set up for mining. A lot of equipment, suppliers, and consultants, and things of that nature. Most of the workforce, of which there's about 2,500 people, are based in Antofagasta. Good services like sealed roads, grid power, and importantly, they get their water from Antofagasta as well, which is on their industrial water. Low elevation and no immediate, what would you call it, townships around the mine itself. It just greenlights across the board. Long history, and it really speaks to the quality of the asset. It's been in production in one way, shape, or form since 1960 and 1961.
I won't go into a lot of those details, but today it's operating at that 20,000-ton-a-day or about 7.3 million tons per annum, and it produces a copper and silver concentrate. We first got involved when we acquired the Orion portfolio in 2017. Subsequent to that, we then contributed to the construction financing in 2019. As I mentioned, Capstone acquired the project in 2021, and we'll come back to that. This is a snapshot of the silver stream itself. One of our peers once said that not all streams are created equal. Why is that? A lot of it is on this page. I would point to one, we have security on assets. If anything ever happened in terms of a credit event, we would get seniority with respect to this asset.
That's really important, and that's often a point that's missed when talking about the streaming business. You can see a steady increase in production there. Again, tracking to that, just over 12,000 GEOs for this year. We have a big AOI, which is an area of interest, which is where the stream covers most of the exploration ground that Capstone has. I'll also point to the fact that there is a step down here. After we received 19.3 million ounces of silver, it steps down to 40%. As of end of the quarter, I think we had 7.1 million ounces being delivered. We've got another 10 years or thereabouts before that step kicks in. I put this slide in to demonstrate one of the weaknesses of the streaming. Often one of the weaknesses of streams is, are you aligned with the operator?
What does that mean? It can mean a bunch of different things, but I'll just point out a couple of key features. The first one is, does the stream over-encumber the asset? What does that mean? If the stream is so large, in fact, that it makes the underlying asset uneconomic, then kind of everyone loses, right? This stream, although we stream 100% of the silver, only represents about 5% of the gross revenues. On a high-margin asset like Mantos, that is inconsequential or at least insignificant. From that respect, we're not misaligned. The other two relate to the two graphs. A lot of data there, but the relationship between copper and silver. Are they correlated? We want them to be correlated so that we're not misaligned with the operator.
The first one on the left is the grades that are actually being fed into the plant. The one on the right is the metallurgical recoveries going through the plant of copper and silver. You see the lines of best fit there, and the correlation is really strong at almost one-to-one. That means we're aligned, and that's really good, right? You want to see that in a stream. Okay, again, the story about Mantos, I'll just touch on the last few years because it speaks again to the perseverance of both Capstone and the quality of the asset. Capstone acquired the asset in 2021. Previously, it was owned by a private equity group. They carried out an expansion from 12,000 to 20,000-ton-a-day. Some of the expansion elements were of questionable quality.
When Capstone took over, to their credit, and I really want to give them a plug, they persevered with this asset and fault-founded and fault-found engineered and then executed a turnaround story. It was kind of a three-year process and all the rest of it, but they eventually reached steady-state about this time last year. We can perhaps go into a Q&A on what those measures were in terms of how they rectified it. A lot of it was back into the plant. This is when they're dealing with the tailing, so thickeners, transfer pumps, things of that nature. More recently, the last 12 months or thereabouts, they've been pursuing an array of optimizations at site. That's been impressive. I should plug Capstone again.
I've been around, and these guys, I was really impressed how they were able to pursue multiple opportunities at the same time. By themselves, like 2%, 4%, 6%, maybe not much. When you add them all together, it becomes material. I was really impressed how they were able to prioritize ones that showed more promise, right? The one thing that we do have troubles with at Mantos Blancos is the variability. You saw that a couple of slides ago. Silver is actually quite variable. Both copper and silver have high variability. Silver is actually probably double the variability compared to copper. That makes a challenge in terms of trying to forecast what happens from period to period, right? By in itself, it's not a problem.
It's just that sometimes the boss comes into your office and says, "Right, what happened this month?" You can see that there have been times when there's been exceptionally high grade, over 12 grams a ton. Then other times when we're four or five, right? How do we manage that, right? Given that the project's been operating at steady-state for the last 12 months, this has really become more apparent. You can actually see through previously when there were problems on top of problems, it was really hard to see, but it's become more obvious now. We've been pointing out some inconsistencies to the operator, and Capstone were good enough to at least hear us. They've recently remodeled the silver resource and have been monitoring that. It's performing far better than it was, say, 12 months ago. That's great.
We have other elements within the stream where we have a two-month lag between when it is produced and when we get paid. In a budget period, it is not the be-all and end-all, but it does help smooth the message. Fundamentally, we do take our own cut or make our own estimate of what is going to happen. When Capstone do provide us their estimates and forecasts and budgets, we layer on what we think is going to happen as well. Sometimes that puts on more conservatism. Okay, 20,000-ton-a-day, this is the throughput through the processing facility. It is pretty obvious. I will just point to the dotted line that 20,000-ton-a-day, this is on quarters as well. You can see over the last four or five quarters, they have managed to become way more consistent, right? They have actually operated this plant up to 28,000-ton-a-day.
They've done that probably almost certainly to de-bottleneck and/or find out where the choke points are in anticipation of phase two expansion. It is an important asset for us. We were at site this time last year, and we try and go every 12 to 18 months. I'll probably end up going down there later this year or early next year. We speak to the operator once a quarter. We get monthly reports, and we get budgets and forecasts and reconciliations and things of that nature. We've got a good relationship with the operator. They've really been fantastic to work with. What do we look for when we go to site and/or when we're looking at disclosure, whether it be private or otherwise? Anything to validate what we've been told previously. What's coming down the pipe is that it's different from last time.
Is our interest being looked after? Are we aligned? Is there an opportunity to collaborate anywhere? These things that are constantly monitoring the situation. It is an open pit or a series of open pits, and that's significant insofar as it's low technical risk, right? When you've got multiple open pits, if you've got a problem in one pit, you can source from the other. It just speaks to the quality of the project. Big equipment as well, I should say, right? It is bulk moving, bulk tons, low strip ratio, things of that nature. Okay, we're coming towards the end of the presentation here, and a colleague will come up and talk about some exploration. This is the immediate near term. We have received a first cut of 2026 budget, and it's similar to 2025.
They have not, and we have not baked in some of those optimizations that I touched on before. We do get another cut at this later on this year and next year before we have to sit on our guidance. There might be some opportunities to increase that, maybe 5% plus or minus. I'll just skip over some plant optimizations and stuff and leave that to Q&A. I'll just look at, talk to phase II expansion. Phase II expansion, Capstone Copper have come out and said that they're doing a PFS, or a preliminary feasibility study, of phase II, taking it to 27,000-ton-a-day. That should be out the first half of next year. A technical report will follow that. If everything goes according to plan, we see first production maybe late 2028, say early 2029.
I will point out that it's an expansion, not a greenfields build or anything like that. Given that they've already operated at 28,000-ton-a-day for periods this year, the build is likely kind of a, I don't know, less than 12 months or thereabouts. Not huge amounts of risk. I think that's it. Guy, do you want to come up and talk too? There you go, buddy.
Thanks, Brendan. It's a great introduction to Mantos. Thanks for that, Brendan. I'm Guy Desharnais. I'm the VP of Project Evaluations with OR Royalties. My background is geology, resource estimation, exploration. I'm kind of the gatekeeper of new investments in the company. Also, because I've been around now for eight years, I have a little bit more history with this deposit and the other assets that we picked up through the Orion portfolio.
Part of the history here is that this used to be an underground mine. You can see some of the old underground workings here. There are cores of this very high-grade material available. The key mining areas are basically covered by here. There are a few other pits off the slide here. When you have this embarrassment of good, high-grade, easy-to-mine material, it kind of sucks in all the activity. The previous operator put out a very long life of mine. In the meantime, there has not been a lot of impetus to really accelerate exploration and get into it. This image is from Capstone and sort of captures some of the key areas where they are intending on exploring.
This is the first time we're really seeing them with their intentions of exercising, getting the drills going, and adding to areas adjacent to the existing pits. Some of this is oxide material. They do actually have an oxide circuit as well where they do heap leaching and SXEW. We are more excited about where the expansions are going to be in here. Regionally as well, we have the key mining area here. You can actually see on this LiDAR image, you can see the topography very clearly here, and you sort of lose it here. This is because there is some overburden. Even the thinnest amount of cover really slows down your exploration and your capability of seeing through there. They are actually showing they are going to start looking at some of that material undercover.
Then the regional claims to the south here as well is going to see some attention. I think it's early days. There has been some work in terms of soil sampling and geophysics that was done previously, but the drill bit hasn't really been active. We're keen to see how this evolves now going forward. With that, I'm going to pass it over to Grant, who's going to introduce the video for Dalgaranga.
Yeah, thanks. I'll be super brief. I'm Grant Moenting, VP of Capital Markets. You'll probably hear me say that in the video again too. In lieu of a partner presentation, because we couldn't necessarily make the time zones work, I pre-recorded a video last week with our partner, Ramelius Resources, on Dalgaranga, which, as Jason mentioned, should be the newest producing asset in our portfolio shortly.
Just if you're in the room, there should be Ramelius presentations on all the tables for you to follow along because Darren, our partner in the presentation, will be referring to some slides. For those who are on the webcast, if you're in the webcast, in the section underneath our presentation, there should be a link to the same Ramelius presentation so you can follow along. One item of note, at one point when Darren says go to slide 23, he actually meant 27. We only did one take of this video. Here we go. Good day, everybody. Thanks for joining us today for OR Royalties Analyst and Investor Day 2025. By way of introduction, my name is Grant Moenting, and I'm joined today by Darren Millman, Chief Financial Officer of Ramelius Resources. This video is being recorded on Friday, November 7th, Melbourne time.
I'm very excited because we are here today to talk about what will very likely be the next producing and/or cash-flowing asset in OR Royalties' portfolio. That's the Dalgaranga High-Grade gold project located in Western Australia. As many of you may know already, OR Royalties owns a 1.44% gross revenue royalty, which was acquired from a third-party, Tembo, on September 30, 2024. Before we get started with Darren, and by way of background, on July 31 of this year, Ramelius Resources fully closed its acquisition of Spartan Resources. Just two weeks ago, our new operating partner provided its detailed plans on how Ramelius expects Dalgaranga to fit into its impressive gold production growth plans over the next year, five years, and beyond.
Everyone here today in person should have a small hard copy deck of Ramelius's most recent corporate presentation, and those online should see a downloadable version. The idea being that if Darren refers to any specific slides in this deck during his answers, you can follow along with him. In the interest of time, I'd first like to thank Darren for his time today, and now we'll jump straight into some Q&A. Hey, Darren. I was hoping that first maybe you could talk about your company's recent press releases regarding Ramelius's new five-year growth plans and specifically on your Mount Magnet Dalgaranga integration, perhaps making specific reference on your company's creative decision to centralize all the processing at your pre-existing Mount Magnet hub and also how Dalgaranga and its high-end, high-grade Never Never Deposit fits in as a core component to Ramelius's path forward starting in calendar 2026 and beyond.
Hello, Grant, and good morning or good evening, everyone. It's a pleasure to be here, and thank the team for allowing us to speak a few words on our most important asset, actually, in our portfolio as we go forward. Probably firstly, for those in the room, refer to slide six. What slide six does here, it basically summarizes our five-year outlook. And we've got two key assets, one being the Mount Magnet asset, in which Dalgaranga forms part of, and the second being in the gold is Rebecca-Roe. So what we've done here is we've looked to put out over the next five years both our production and also our all-in sustaining costs. Just to keep mindful that the all-in sustaining cost is in AUD as opposed to U.S. dollars.
What we've also tried to do here is to just highlight how we compare with our peer group. As you can see on slide six, we have a growing production profile. Basically, we're looking to become a 500,000-ounce producer, with Dalgaranga being key to that. What I could also flag here is that we're about $500 an ounce less than any of our peer groups, which was noted in the footnote. For us, we can do this by enabling, once we've been able to be very low cost and maintain a good cost overview. We're a hub-and-spoke company, which basically extracts all sources within a region and then puts it to our most central mills. At the moment, Mount Magnet is what Dalgaranga will be forming part of.
For us, as you can see in that slide, we'll be currently proxy $200 million or 200,000-ounce producer for the next two years and then rising every year. If you look at the blue representative, that's Mount Magnet in which Dalgaranga forms part of. Basically, that's the engine room in which we'll be growing to us hitting proxy 350,000 ounces from Mount Magnet alone. For those who've got the deck in front of them, I'll just point to slide seven. We've got the two assets in the portfolio, one being operating, which is Mount Magnet, and the second being Rebecca-Roe. What we're trying to do here is just flag sort of what the sequencing will be over the next several years because at the moment, Mount Magnet is an existing operation.
What we're looking to do is to take this plant from 2 million ton per annum up to 5 million ton per annum. I'll get into that shortly. I guess for the benefit of those on the call or in the room, historically, we were looking to develop the Rebecca-Roe project in FY 2027. We've actually pushed that back to FY 2028 to purely focus on the Mount Magnet plant in which Dalgaranga will be processed. We've pushed it back 12 months. We want to technically focus on delivering Mount Magnet, and we're comfortable to move that back one year for Rebecca-Roe, purely to ensure we deliver on time and on budget the project that Dalgaranga forms part of. Probably the next slide that makes sense to speak to would probably be slide 12 of the deck. That just gives you the overview specifically on Mount Magnet.
As you can see here in the orange, the contribution coming through for Dalgaranga is very, very key for us to get that growth profile. At the moment, you'll see sort of minimal coming in in FY 2026, but it will contribute significantly year on year. I'll be putting forward the Mount Magnet operation will become a tier-one asset in Australia, obviously tier-one jurisdiction, and with a very, very low cost profile because of the high-grade ore that Dalgaranga contributes. For those that are on the call again, slide 13 just gives you that flavor on where and how quickly this project ramps up. As you can see on the slide, we've got sort of 0.2, then 0.6, and then 1.1 ramping up year on year.
If it was the previous owner, Spartan, they would be putting forward the average run rate could be between 1.2-1.3 million ton processing per annum. They're probably putting forward up to 9 grams per ton in the context of grade. We've been able to deliver year on year, both on production and cost guidance as a company. We're the only ASX producer that has both consecutively hit cost guidance and production. That is sort of fact. This is something that we pride ourselves on. What we're putting out in the context of volume and grade, we can put a hand on our heart and know we're going to deliver that. There's potentially some upside when you look at that. For me, it's an achievable plan. There's potentially some upside operationally, and I'm sure we'll get into exploration as well.
Darren, did you want to touch on some of the metallurgical test work you've done and maybe just an overview of the plant, maybe in a little bit more detail? I think that's slides 14 and 15 in the deck.
Sure, Grant. As Grant said, on slide, we spent a lot of time making sure we got this right. We studied. Historically, Spartan did a lot of test work. As you can see on slide 14, there were elements of Ramelius and Spartan, the previous owners of the Dalgaranga asset. Over time, this is basically a three to four-month program. We acquire or we announced the transaction with Spartan in March. We then put out, we closed on July. Basically, this test work ran us all the way up until our release last week.
What the test work basically tells us is our existing plant at Mount Magnet, we're grinding to 175 micron. If we were going to do that, the recoveries would be approximately 80%. If we grind the ore down to 53, we get approximately 93% recoveries. What we're also looking at in this process was how much retention time is required. Basically, what the results have told us is, okay, if you actually grind it to 53 micron, then you can actually get that 93% versus some other test work was indicating you might need 24 or 48 hours retention time to get these higher recoveries. We spent a lot of time to understand the test work. From that, we then decided to develop the appropriate plant requirements to go forward.
One thing that you would have seen, we're doing this ramp-up in FY 2026, FY 2027. We will be recovering at these lower levels because we want to, it's not a huge amount of tons that we'll be processing, but we want to ensure by come early FY 2028 that we've got these higher recoveries and the plant is in place. FY 2026, FY 2027 will be grinding at 175. And this is all lab work. Historically, when we've done lab work and then the actual results, we have gotten better recoveries. Obviously, we're hopeful that we can move more tons earlier and that the grades will be above the 80 that we've got in our test work. Time will tell, but we've got some upside we feel in that.
If you look at slide 15, this actual plan, we went through eight different options as we went through the process, and we landed with option eight. It is a little unusual. On the left-hand side, you will see circuit one, and that is the existing Mount Magnet circuit running at 2 million ton per annum. Because of the additional grind that the Dalgaranga ore material needs, we will have to be running at 53, which then reduces the tonnage. What our operational guys have said is Mount Magnet itself is actually built better to be processing the Dalgaranga material than you would generally think building a separate plant for Dalgaranga ore alone would be the right solution. Everything our sort of metallurgical test guys on the ground and the third parties have actually suggested, it is kind of a flip.
The ore from Dalgaranga should be going to the Mount Magnet plant. The new Mount Magnet, or the new plant being built at Mount Magnet, should have the existing old ore, we'll call it at Mount Magnet. It was quite a great solution in our view. Through that process, we can save $100 million in capital savings in doing that because we're also utilizing existing Dalgaranga equipment that enables us to do this. We think it's a really good solution, a smart solution, and it enables us to process the Dalgaranga ore quicker, which means we can get the access to the higher recoveries quicker, which is obviously important from an NPV and things of that nature perspective.
Of course, of course. No, that's great, Darren. Thanks very much. Super insightful. Just moving on here, maybe you can touch briefly on Ramelius's view on any potential upside at Dalgaranga that could result from further work on understanding both the Gilbey's underground as well as the potential Never Never Open Pit projects. I know you provided a few scoping study level details in your recent releases, but perhaps maybe you can expand a bit on how and when you think these might also ideally slot into your plans.
Sure, Grant. On slide 23, it probably best speaks to the ore body that is Dalgaranga. I could highlight sort of that PFS that we did release, which is just on the Never Never and Pepper to the north side of the Dalgaranga system. We declared the resource or the reserve, sorry, and were able to put that out there a couple of weeks ago.
That was just purely on Never Never and Pepper. Obviously, you can see there, very thick ore body. We call it we're going down the neck for the first few years. In fiscal year 2030, we'll be actually to the heart of the ore body. I think that's important just for people to be aware of. That's when the grade really ticks up, looking back at that sort of production profile that I showed. Probably just be aware of that. We've only drilled down for the kilometer. It just becomes not economic to continue to drill. We feel there's a lot of potential still at depth at Never Never, which is on the north side. The other potential, and we're drilling 75,000 meters this year alone on the Dalgaranga system as a whole.
There's some infill, which is Never Never, as we're looking to mine that. The real potential upside for us we see is on the south side. We're kind of referring to that as the Gilbey's underground, which is underneath the existing open pit. We've actually built the Juniper decline that's going sort of to the left. You turn left, basically, you're hitting the Never Never underground. You turn right, and then there's the potential to become the Gilbey's underground. We've done a scoping study on the Never Never open pit up the top. That's going to form part of our mine plan. That's at a scoping study level. We've done a preliminary assessment just at the four pillars area. That's kind of, we'll call it a starter underground.
This year, as I said, we'll be spending or drilling 75,000 meters, approximately just under AUD 20 million on that south side. That's where we see, I guess, the biggest potential in our portfolio in the context of volume of ounces. For those that have looked at the deck a bit closer, we've got Penny and Q and Galaxy. For potentially finding new ounces, it's actually Dalgaranga to the south side. The Dalgaranga Never Never ore body is approximately somewhere between seven from a reserve perspective, nine from a resource perspective. If you see on the page there, there's a pretty good drill result. 6.3 meters at six, four at six, seven at nine. There are some pretty good grades. Applewood, 19 at five, 1.8 at 17. There are some good hits.
Our gut is when you dilute more on the south side, you won't be getting these same grades as we saw at Never Never and Pepper, but you still be getting some pretty good grades. If we're ballpark, ideally, we're probably more in the 3-5 gram sort of space. But you've got volume, and that's what we're trying to build up. Probably come September next year when we release our reserves and resources update, that's when you'll be finding out more, a lot of infield drilling to validate, do we have a real mine there? Subsequent to that, we'll do more drilling. That's probably when we'll know if this could become another underground mine. On slide 28 is kind of the corridor. Bottom left-hand side there, that's where Pepper and Never Never is.
There are further potential opportunities, Golden Wings, Patient Wolf, Beefeater, Bombay. The previous owner was a fan of gin, hence some of these names. Four Pillars, for example, is actually an Australian gin, so a bit of trivia for you. That is more longer term. We are focusing on what we know today, where the resources are, where the high-grade shoots have been seen, and in the longer term, what we will be going after as well. I think there is a lot more to come. We are focusing this year on obviously delivering the mine on time, on budget. We will be in commercial production early FY 2027. This is the longer-term play, I think, for us from an exploration perspective.
No, that is great and really exciting. I mean, you touched on the regional stuff at the end. Without looking too far in the future, I mean, you guys acquired Spartan Resources. Obviously, there is a mine already there and potentially more, as you have just outlined. Is there maybe an internal belief amongst your exploration team that perhaps what has been discovered to date and as defined by Spartan and yourselves is only just the beginning and that potentially there could be other Never Nevers and Peppers out there along the sort of regional corridor?
Yeah. They call it the Bugatti breaks. That is sort of, I am not a geologist. At times, I guess I pretend I am an accountant. There are these really high intrusive sort of breaks that they are referred to.
That is how Simon Lawson, he followed the Mount Magnet structures, understood the Mount Magnet structures, took that learnings, applied it to Dalgaranga, and then that Pepper zone area, that was the sort of really close together breaks. You need to be really onto it from a geological modeling perspective on where to drill. It will take time. Obviously, hopeful to find more high-grade, these sort of shoots. Historically, it was just this open pit, and they had not discovered this underground. What was defined as we know today in the reserves and resources, that was really only done in the three- or four-year period, which is obviously a very short period of time. Our view, there is a lot more potential here. We paid AUD 2.5 billion for the pleasure of owning the asset. We have already done an NPV on it at AUD 4,500 at 3.5.
We view it's all upside. I'm sure you guys will be happy to find more ounces as well. For us, it's more, let's just get the mine right. Let's find out what's underneath the existing open pit, the Gilbey's pit. From there, we'll more get into the regional. Yeah, there's nothing that wouldn't suggest further upside. It just really get operational and focus first. Second would be the underground at Gilbey's. Thirdly, this corridor that I just spoke to now. There's definitely potential, and we'll continue to drill at this level, if not more. I guess for the benefit of those on the call that don't know Ramelius, we went from an AUD 50 million budget in FY 2025 to up to AUD 100 million.
That was kind of the mantra brought from the Spartan guys that were able to find a lot of ounces in a short period of time. If we've got the targets, we've got the balance sheet to do what we need to do. It's only going to grow with our portfolio, as you saw that production profile. We've got the money to do it. If the drill targets are there, then we'll drill it out. We've gone from five drill rigs to 12 drill rigs in a matter of under 12 months. If we need to go higher, then we will. We have been able to get access to them. It does not seem to be an issue at the moment.
I think that's all the time we have, Darren. We had just 15-20 minutes to get through this. I wanted to thank you so much for your time today. I think we're just as excited as maybe you are to see your team go forward with this sort of sensible execution with respect to your outlined plans. With that said and done, I think we'll conclude this section of today's agenda. I'm now happy to pass things off to my colleague, Guy Desharnais, to run through some of our key growth assets.
Thanks, Grant.
Thanks, Virtual Grant. Do you have the other clicker? This one's deficient in lasers. That's really great. I love how Grant pestered the CFO to give us some exploration upside. This is a very recent acquisition on our part. There was no mine plan for us to build off of.
Hats off to Brendan, Matt, and myself for figuring out more or less what this asset could do in terms of mining productivity, grade, recovery. Pretty much everything that we were hoping for was shown in there. The only thing we got wrong is the price of gold. Now it's all upside from here. This slide deck was constructed basically to walk you through what process we'll be going through in February next year to try to construct our five-year outlook. You've seen this slide many, many times. It gives a good overview of how we think about our future growth. I'll be walking through some of the names in this column.
We've seen pretty significant increases in the likelihood that some of these assets that were on the outside looking in last year in February or this year in February, and they've advanced and de-risked and gained. We are gaining confidence that they're going to be making the graduation and being inside that 2030 outlook. That outlook that we currently have in 2029, one of the anchors of that is the Island Gold asset, Alamos Gold. This is a long section looking at the asset. They are including the Magino Pit now within that view, which is super useful. We've created an overlay of the royalty percentage over that asset. In gray are things that have been mined out. In orange are the reserves.
One thing that's really important in the flow of the inventory that's going to go through the mill is they've mostly been mining within this 1.38% NSR area. As the life of mine gets more and more mature, they're progressively going more into the 3% areas and the 2% areas. The royalty percentage will naturally increase with time. We're also going to benefit from the shaft, which is going to provide them a better, more production, or the production rate will increase with time. This is one of the bottlenecks of the asset. Also, the higher grade at the base of the mine here. A lot of the amazing drill intersections that they were providing over the last few years were from this section over here. We're going to benefit in three ways.
As the life of mine grows, we are going to have higher tonnage throughput. Alamos had put out in July an updated study, but that was mostly a de-risking. So a lot of the inventory was in inferred resources, and it's graduated to a lot more reserves. And also an update on Magino. The study that we were looking forward to seeing is the expansion studies, which was supposed to be end of this year, but it's pushed back to early next year. We'll be really keen to see what happens there. There's quite a good potential that we're going to see above and beyond what they have, what they've shown previously.
One of the aspects that they're pointing to is that the shaft that they're building and is near the base of the shaft now has excess capacity to bring up waste and ore to surface. They're going to try to increase that. We're hopeful as well that they're going to start building in these hanging wall and footwall zones that they've been talking about. Those should be ramp accessible and could bring up the amount of ounces in any given year. CSA is another cornerstone of ours. Recently, MAC Copper got purchased by Harmony Gold. In the background here is the overlay. We're semi-hiding it because this was MAC's plan. MAC was basically pointing to around 40,000 tons of copper per year last year towards 50,000 and beyond.
The important pieces of that growth were going to be the ventilation system, which is ongoing, which would unlock the base of the mine where the very high-grade material is, and also two separate mining sectors in the upper part of the mine. There are some copper lenses up there, but also zinc lenses. They refer to these as the Merrin Mine. We will have to wait till early next year. Harmony has promised us an updated life of mine and a plan going forward. We expect part of Harmony's thinking about the value of this asset is within those aspects. Mantos, Brendan did a great job of summarizing. We are keen to see what the expansion study will show in terms of tonnage and timing. We have talked about the assets that are producing now.
In February of this year, we had outlined three of these four assets as being going into production between now and 2029. We've added Dalgaranga in our most recent releases. Windfall is one asset that we've been waiting a long time to graduate and get into production. There's been a lot of good work done by Gold Fields. They're in the floor below us in Montreal. We see lots of new faces, lots of activity buzzing around. They have a lot of catalysts coming up. IBA permitting and an updated feasibility in early next year. We have a good update now on Dalgaranga. The CFO gave us some extra upside beyond what we see, which is great. Marimaca is an asset that, because of the copper price increasing and the simplicity of the construction and the permitting on here, has gained a lot of credibility.
Now the market cap of the company is above $1 billion very comfortably. Here we're expecting the permitting and FID within the next few months. Hermosa South32, is spending $750 million this year to advance the project. That's on schedule. Everything points to things going well at that asset. These are key things that were fairly easy for us to add to our five-year outlook at the beginning of the year. Now we're going to look at some of the assets that were on the bubble or that were under consideration that we couldn't do. Primarily those that have really advanced in terms of de-risking and the likelihood that we will be including them in our updated five-year outlook. We see a lot of names here. Jason showed a forward-looking warning statement. This is the most forward-looking portion of our talk.
We'll be naming, giving you descriptions of some of these assets. It does not mean that we will be including them. It means that we will be considering them when we do the exercise of the updated outlook in February of next year. Osisko Development, advancing Cariboo. Sean has done an amazing job of de-risking and raising the money to advance the project. Several hundred million dollars were raised in equity over the past year. We have the construction here of the Appian facility, which is a very innovative piece of financing that is going to backstop some of the future things. Here we are going to be looking forward to an official FID. In the meantime, they are spending a lot of money advancing the project. We have now access to the Lowhee Zone through ramp.
They've opened up a corridor here and are drilling off 13 km of drilling. This is something in the next few months we hope to see the FID and a construction decision. Eagle, last year, we completely wrote it off on the financial side, and we removed it from our outlook. There was a very unfortunate event here, as most of you know. Since this time last year, what we've seen is that there's a lot of hope. PwC is running a process to find a new operator. There was a lot of interest in that first round of first phase of evaluation. Now that second phase is ongoing. Several operators are looking at this asset. The deadline for bids currently earmarked for December 31, 2025. Will we have sufficient certainty come February to decide what we do with this asset?
That's going to be a tough one because it'll still be in the process of figuring out the nuts and bolts. This is a very chunky asset for us. It's around 8,000 GEOs per year. When it turns back on, it'll be very meaningful for us. Spring Valley was an investment we made in 2021. $26 million were invested. Over the past, it took a while for information to come out. This is within Waterton Gold or Solidus Resources. They put out a feasibility earlier this year, outlining an announced profile that may have surprised some people. The project is in Nevada. It's fully permitted. Now with a recent announcement from Wheaton, it's fully financed. Our royalty is covering everything that's known and chunky over the thickest, most important parts.
I just want to point out that we have a 500,000-ounce holiday basically on this core claim, this 3.5% royalty area. As part of the Wheaton investment in this asset, we got a little bit more information. The Executive Chairman here, they have announced that early works are ongoing, and first gold might be in the first half of 2028. Last year, this time, this was not really on our radar. We were really hard to nail down when this thing could start. Now we are pretty confident about the starting date of that. Amulsar is a project in Armenia. We have had it as part of the Orion portfolio. It had some issues several years back. The group at OR International have worked really hard to preserve our exposure to that project and also increase or improve in several ways our stream that is on this.
Now this asset is within United Gold, which is the same team that built the Allied Gold portfolio. The asset is now owned partially by the government, which helps ensure that everybody's aligned with the continued construction of the project. They are advancing construction activities, trying to close buildings down to make sure that they can continue over the winter. Just on this asset as well, the stream deliveries to OR International are going to be accrued during the period that the $150 million debt facility is paid down. Once that's paid down, that accrued amount gets paid out over a five-year period. South Railroad is a very recent investment on our part. Orla is going through an updated feasibility study now. We expect that quite shortly. Record of decision by 2027 and construction potentially end of 2027 on an asset, which is we have 100% Silverstream.
It's in Nevada. Should be fairly straightforward. We're looking forward to seeing what that feasibility study reveals because obviously the recovery of gold and silver will increase as they go to a finer crush. We don't know how much they'll invest in terms of the CapEx and OpEx to achieve that. Given the high prices of gold and silver, I think it'll make sense for them to try to pull out as much of the metal as possible. Upper Beaver, I think Agnico surprised many of us by how quickly they constructed and how big the infrastructure is on surface here. This is meant to be an advanced exploration activity. You can see from the size of the shaft, this is built to be a mine as soon as possible.
In terms of the start date of this, it's hard to nail down because the permits are not in hand. I think Agnico is being a little bit careful in terms of messaging of when this can start actual production. In the press release where they outlined the project of 210,000 ounces of gold per year, they pointed to 2031-ish. On their website, they're showing the goal of 2029 to 2030. This is an example where come February, we're going to look at this. We don't have any insider information, but we'll debate internally on what do we do with this. It's going to be on that cusp. Very reputable operator whose intention is to go as fast as possible. Given that it's on this bubble of timing, there's a good chance we won't be including this asset.
Cascabel is one of our most important development assets. It's located in Ecuador. The new management team there has been a breath of fresh air advancing a new project execution plan hand in hand with G Mining Ventures. The new timeline for first ore is quite early. They're drilling now, and there's a good press release this morning on very good drill results on that Tandayama pit. It depends what the final configuration of the mine is because there's different aspects. The real important high geoprofile is related to that Alpala block model or that block cave, which may be done partially within a sublevel cave. Depending on how you configure the project, it's going to change. What we know as a base case as of 2030, we'll be getting payments of $4 million, which we'll have a chance of being accounted as GEOs at that time.
Our cornerstone asset obviously is Malartic. We spent a lot of time thinking about this asset. Matt and I will be visiting the site this week and try to capture as much forward-looking statements from there on that visit to try to see how they're thinking about the asset, timing of the expansions, and the shaft. We've accumulated a lot of knowledge, collected a lot of breadcrumbs. We try to, in this part of the presentation, sort of put those breadcrumbs together and lead you to a potential conclusion. This is a long section that we've seen several times. I just want to point out that the resources and reserves on this is a very big number, but it's not done growing. Reserves are 7.5 million ounces. MNI is 2.5 million ounces, and the inferred is an additional 10 million ounces.
I'll encourage you to go to the back of the deck. You'll see the details of those numbers. What's not included in any of those resources are the Eclipse zone, which looks very similar in terms of thickness and grade as East Gouldie. Nothing with respect to the Titan zone, the Keel zone, or the internal zones. Those are all upside beyond what's even on paper for this asset. On the long section, you see the only parts that are referred to in the resources and reserves are what's in orange, which are the reserves, and in blue, which are the resources. All of the rest of this pale green of East Gouldie is not in the table at all. Year-over-year, this green blob keeps growing. This is the edge of the green blob at the end of or in February 2024.
That's growing, and we're also seeing intersections beyond that version. So this inventory, which is gigantic, will continue to grow. This is just a point in time. In five years, it will look very different. This is the current life of mine that Agnico is showing. A few things to note. In 2027, they backfill it with more than 100,000 ounces year-over-year with material that they think now that they're going to be able to mine from underground and fill the mill. The other thing to note is that already in 2026 and 2027, the mill is not completely full. So any additional mineralization or inventory that they can send there is a win because you have a fixed cost, which is that processing cost, and anything that you can bring in there is a win. This is a long section of the mine plan of East Gouldie.
One thing that was noted in the Q3 call, they've identified and they keep growing and hitting very good holes in this upper east East Gouldie section. They made this comment of including a potential second mining area in the upper mine. We don't know what that means now. We have no context. Potentially, it's access via the ramp or the upper loading pocket. Potentially, this is a parallel system or a parallel mine production that could fill in some of these tons that are latent in that mill. We've drawn some cartoon lines on here. It's very easy for us to do that just to illustrate what it is. We understand mining is hard, and for us to show you what this could look like is a little bit too easy to be real.
We know now that the second shaft is a very likely scenario, and I'll explain to you why we think that. I just wanted to leave the traces of how Agnico has been talking about this second shaft over time. This is as early as Q1 2023, we had the first mention. Obviously, Q1 2025, we have a potential for that second shaft. Now we're not talking about second shaft or the current shaft that they're thinking is no longer called the shaft or the project we're working on. They're calling it shaft number one because clearly to me, shaft number two is on its way and hopefully another one after that. Now the language of Agnico is the vision to a million ounces annual production at Malartic. They're being quite explicit now, giving ounce production and mill throughput numbers associated with that.
It's becoming more and more concrete as time goes on as Agnico continues to talk about this opportunity. On this slide, interestingly, they show the entire belt of claims that they have. I've added some other points of interest that are more interesting for us and for them. We have a small royalty on Akasaba West. AK is going into production imminently. It was meant to go into production this quarter. Akasaba West is actually being trucked to Goldex, and then the concentrate then is going to LaRonde. AK is planned to go all the way to LaRonde. When they're talking about district scale and we have synergies, I think they are thinking about the world being a lot smaller than we think. I'll just note that these two deposits, Upper Canada and Anoki-McBean, there's several million ounces of resources there.
They're right next to the rail. That rail is plotted on their map and runs right next to Malartic. There is a scenario where they think, "Let's do hub and spoke, but go really big on this." We are looking forward to seeing the 2027 study, which potentially could include some of these potential synergies that we're seeing. This is a slide of us trying to figure out what is the potential timing of this shaft number two. We like to play a game at OR called What Would Ammar Do? When we're building this, we're trying to give you a timeline.
If you're standing in end of 2026 and you have an opportunity ahead of you, what are the different aspects in how Agnico has in terms of their resources, their capital allocation priorities, the human resources they have available, and the opportunities to fill the mill with material could be? The purple line here, and I think this is surprising for a lot of people, is the amount of time to put in this ramp or the main decline to the bottom of the mine. It is an extended long lead item to get to the full production of the mine. That decision was actually that decline was taken a few quarters before the actual FID. If it makes sense and provides them with flexibility in terms of the schedule, they will spend some money to get things going. Then shaft number one, there's a period here.
It's split into three. Surface infrastructure, shaft sinking, and the underground infrastructure. Everything outside this yellow box are things that there's enough information in the public disclosure of Agnico to trace, including the commissioning of that mid pocket. This might be surprising how long it could take here to do the other loading pockets. There's quite a bit of uncertainty, and it's sitting inside our yellow box here. Part of the reason is they need to, or ideally they'll have access through the decline as well to get the equipment in there and also provide secondary egress for safety. Again, the amount of tons available to fill the mill, that wedge starts growing already at the end of 2026. In the yellow here is basically our conceptual view of how this buildout could occur.
We're expecting a very important report for us and for Agnico about how they're going to look at the Canadian Malartic overall milling infrastructure and the mining scenario at the beginning of 2027, so Q1 2027. We anchor that piece of surface infrastructure at that same time. If it makes sense for them to spend a little bit ahead of time and give them the flexibility to go earlier, then there's potential that leaks out ahead of that official decision. All that to say, they are pointing to early 2030s for that shaft number two. Depending on how Ammar feels, what would Ammar do when he's standing in 2026, there is potential to compress this. There's one thing also is the shaft sinking that this amount of time is three and a half years of shaft number one, and we have it shorter here.
One reason for that is because they'll have access at the very bottom. There are methods to accelerate that from the bottom up where you have access on multiple levels, and you basically remove the need to scoop at the base of a blind shaft sinking. There is latent capacity, even if you take all the pieces that they've outlined that they're going to feed the mill. This is basically in the PEA or the 2021 study, shaft number two, which is required. Marban and Wasamac, there's still 10,000-15,000 tons per day that could go through that mill. What would Ammar do? We think there's a very good chance that Agnico takes the leap and commits to a third shaft or shaft number three. This was initially brought up in Q1 2024.
Again, the CFO brought it up in May of this year and Ammar at the Denver conference pretty explicitly. Eventually, we might even build a third shaft. Following the pattern of how the second shaft was slowly building confidence of the language that was changing, we think there's a pretty good chance that we're seeing a similar scenario here where they're preparing the markets. I think they need to be careful, especially in the past few years, making sure that the schedule of capital deployment is in a controlled manner, that they're not putting out big ticket items willy-nilly. I think they're building towards this scenario, and I think it makes a lot of sense economically. We're going to wait to see very keenly to see what the result of this is. Thank you. I'll pass it on to Frédéric Ruel, our CFO.
Good afternoon. Thank you for being with us today, whether in person or joining through the webcast. For those that I haven't had the chance to meet, my name is Frédéric Ruel, Vice President Finance and CFO of OR Royalties since 2020. I have been with the company since 2015 and prior to that with the Osisko Group during the building of the Canadian Malartic mine. It is a pleasure for me today to provide you with a quick finance update with an emphasis on our balance sheet position. I will also give you a quick update on income taxes at the end of my presentation. For those who have been following us for the last few years, you have seen the work that we have done to simplify our business.
The simplification is clearly reflected in our financial statements, which are now a lot easier to read and understand than a few years ago. On that same note, you've probably noticed in our most recent filings that since August, Osisko Development is no longer considered an associate from an accounting standpoint. Therefore, you won't see these non-cash shares of loss of associates in our results from 2026 onwards. Certainly, a key point in our Q3 results, for the first time in the last 10 years, we are debt-free. From 2017 through 2022, we had debt outstanding on average of CAD 400 million, which was mostly related to the acquisition of the Orion portfolio. During that time, questions were raised regarding our investment capacity, and strengthening our balance sheet became a high management priority.
In the last two, two and a half years, as a result of our disciplined approach to capital management, the sale of our Osisko mining block, and of course, the positive metal price environment, we have repaid debt quarter after quarter, despite continuing to deploy capital to accretive acquisitions and while continuing to increase steadily our dividend. As of the end of last quarter, our credit facility was fully repaid. At the end of Q3, we had $57 million in cash. Since then, OR Royalties International has received payment for the MAC Copper shares of $49 million, and we have continued to generate free cash flows. As of today, we have approximately $120 million in cash and an undrawn credit facility of $650 million, plus an accordion of $200 million.
As a reminder, in May of this year, we increased our credit facility by more than 50% and extended its maturity date to 2029. We also own marketable securities with a market value of approximately $150 million. All of this gives us incredible flexibility in terms of investment capacity, the strongest we've seen since the company was founded in 2014. The next slide illustrates the strength of our current balance sheet. Our available liquidities allow us to compete on most transactions without needing to raise capital. Despite this additional financial flexibility, we'll continue our disciplined approach to capital deployment. On the next slide, we show a brief overview of our dividend history. The dividend was implemented at the end of 2014. At that time, the quarterly dividend was CAD 0.03 per share, which would represent approximately $0.021-$0.022 per share today, using the current exchange rate.
Between 2014 and today, the dividend per share more than doubled, increasing by 150% for an average compounded increase of 9%. The last increase was in Q2 of this year, where we raised our dividend by 20%. Annually, over CAD 40 million is distributed in dividend to our shareholders, and over CAD 269 million have been distributed since 2014. A dividend reinvestment plan was also implemented in 2015, and historically, a 3% discount has been offered to shareholders participating in the plan. I'd like to take this opportunity to remind non-registered beneficial shareholders that following our name change and assignment of a new QZ number last May, you may have to submit a new enrollment form in order to continue participating in the drip. You can consult our latest dividend press release, our website, or contact us if you have any questions about this.
Lastly, at the bottom right of the slide, we have a graph that shows that we have the capacity to continue to increase our dividend, as the current cost of the dividend represents only about 20% of our pertaining cash flows and around 17%-18% for the first nine months of 2025, compared to an average of 25% for the last 10 years. The dividend level is reviewed quarterly by the board and is determined in a function of considerations, including our financial position, market conditions, and anticipated cash requirements. On the next slide, we present a brief summary of our current NCIB program, which was implemented in 2016 and has been renewed annually since then. The current program allows the company to buy back up to 5% of its outstanding shares.
Since the program was put in place and when taking into consideration the Orion share buyback in 2019, a total of 20.5 million shares have been acquired for cancellation for a total acquisition price of CAD 279 million or $13.60 per share. This represents more than 10% of our current shares outstanding. Today, to acquire these shares, we would have to pay over CAD 900 million. The NCIB may be used when we believe that the underlying value of the company is not reflected in the market price. On another note, and we've telegraphed this in the last quarters now, we'll be cash taxable in Canada for the first time in fiscal year 2025, mostly as a result of increased revenues and the depletion of our Canadian tax pools over the years.
For 2025, based on the first nine months of the year and our forecast for Q4, we estimate our taxes payable in Canada to range between CAD 13 million and CAD 15 million, all of that subject to our actual result in Q4, of course. As we've mentioned before, these taxes will be paid in the first quarter of 2026. Starting in 2026, we'll make monthly tax installments. We also have certain assets taxable in the U.S., Mexico, and next year in Australia, and we're told in taxes on certain revenues earned outside of Canada, but these are currently not significant. The effective tax rate for the first nine months of the year was 19%, when excluding foreign exchange impacts, the share of loss of associates, and other non-cash gains and losses. In other words, operating income plus interest revenues minus finance cost.
The current effective tax rate for the first nine months of 2025 is also where we expect to remain over the next few years. A reasonable range would probably be 18-21%. Of course, subject to metal prices, our mix of geographical revenues, and our future investments, which may be tax deductible in Canada. Please do not hesitate to reach out if we can assist you modeling income taxes in your respective financial models. Overall, I would summarize our current financial situation as being the strongest we've seen since the creation of the company more than 10 years ago, providing our corporate development teams with a greater flexibility to acquire assets that will benefit our shareholders. I'll be available after the presentation if you have any questions. Of course, I will now hand the floor over to my colleagues, Iain and Mike, for a corporate development update. Thank you.
Thanks, Fred. Mike and I are just going to walk through the corporate development section. This is the last piece of the presentation today. Grant should be quite happy. We'll have some time for a Q&A after this. To start off, we wanted to provide you some insight in terms of our investment process and philosophy. The first thing I want to say is that OR is focused on building a portfolio for the long term, not just adding growth for growth's sake, but to really focus on a disciplined approach to value creation. Precious metals investors are looking to preserve value and purchasing power, so it's our job to build a portfolio in an accretive way that allows our shareholders that safety while also providing great optionality to the assets we've invested in.
Royalty is our long-duration assets, so it is critical to understand the risks to those investments. As Jason said, we are risk managers for our shareholders, so we take a disciplined approach to long-term value creation. How does this work in practice? We invest based on three core pillars, and each of these are assessed on quality, considering the context under which we invest, and with a mindset of sustainability. In a perfect world, we would have 10 out of 10s across the board on project quality, jurisdiction, counterparty, and investment structure, but it is just not possible. This is where the context comes in. We need to review these core pillars in concert with one another.
Basically, we can use one to bolster another, where, for example, a good, well-structured deal with a very capable management team in a jurisdiction that is not necessarily tier one would be an investable asset for us. Since our last investor day 24 months ago, we've made a number of investments. These are a selection of those. If you look at all these together, over our 2025 GEOs, it would be about a 20% increase, so not an insubstantial number of investments, and they each fit our core strategies one way or another. For Cascabel, it was all about asset quality. It had a syndicated structure, which alleviated some of the risks of investing in Ecuador, and deferred payments are deployed, which also de-risk the investment. Gibraltar is a long-life tier one asset with a very capable operator in Taseko .
This is the third such amendment we've made in that asset. They've been operating there consistently, sometimes as low as $2 a pound copper. Dalgaranga is one of the best, as we heard today, emerging gold projects globally and one of the best mining jurisdictions in Western Australia. Ramelius saw value there and bought Spartan Resources for over AUD 2 billion. Another one I'd highlight on this page is Sable. It's a smaller investment for us, but it's one that highlights our technical team's capabilities, where we saw Freeport making the Aurora discovery in northern BC, and just across the boundary there, TDG had the Orwest project, and we made the royalty investment on that asset. All these investments were made below $3,200 an ounce gold, and 90% of the dollars deployed here were under $3,000 an ounce. Here's our due diligence process or our investment process.
Brendan calls this the machine. We're always trying to improve our DD process and methodology. We start with origination, where we really focus on the assets and the teams that can drive value and have a proven track record of doing so, and understanding our counterparty's needs to tailor investments to a solution there. As for the DD, there are projects that are just quick no's. They will be discarded quickly and efficiently, whereas others take a jump to later stages where we do full DD. Guy will run a block model, Matt will run mine planning scenarios, and Brendan builds the cost base from the bottom up, so really to understand the opportunity. It is this in-house context that allows us to invest dollars on a relative basis. We've got fixed dollar resources, so it's really that relative basis and the context that allows us to deploy efficiently.
We don't outsource our investment conclusions. We do not employ outsourced DD only on a select basis where we need to bring in skill sets that we don't have in-house. We also see feedback loops here. We do regular look-back analysis. Some people like to say that it's best to learn from your mistakes. We like to learn from our mistakes, but also other people's mistakes as well. We consistently look back, see what's worked, see what's not worked in the past, and fill those gaps in our process. The other feedback loop is with our partners. We need to consistently be supportive, understanding where we can add value and support our investee partners along the way. Our team reviews a lot of opportunities.
We've been busier than ever over the last 24 months, busier than any time in OR's history, in fact, and the quality and size of opportunities have been better than we've ever seen. We've been very, very busy, but our deep portfolio of optionality and growth allows us to be very disciplined in how we review new opportunities. We have a stage-gate approach. Over the last 24 months, we've reviewed over 300 investment opportunities. Typically, we do a first pass. The bulk of these assets that are rejected are rejected on asset quality, jurisdiction, and commodity. As they move through the due diligence hopper, they get to the end where we're then rejecting opportunities on things like ESG criteria, structure, and pricing. All in all, we basically have a 2-5% completion rate on the transactions that we review.
This reflects our very diligent and disciplined approach to execution. I'll call Mike up.
Good afternoon, everyone. For those who don't know me, my name is Michael Spencer. I'm the President of OR International. I've been with the company for eight years now, and I spent the first half of my career before OR in investment banking and mining in Toronto. My background is finance, so I'll try to keep it within those swim lanes. You heard Jason and Iain both talk about long-term value, building long-term value. This is something that's at the heart of our strategy and drives the decisions that we make every single day. When we think about portfolio construction, and that's how we do think, we think about our new investments not only in a five-year timeline, but also a 5, 10, 15, 20, 40-year timeline.
When we think about risks and when we think about optionality, we think in all of those time periods. It's the only way we have to go about it. It may surprise you that not every company in our industry does that. You will see that too many think about things that are right in front of their face the next five years, and they have the belief that scale is the driver to a premium valuation. Add more ounces, add more ounces, and we'll get a better valuation. When you think that way, when you're looking at your due diligence process, when you're managing your contracts, negotiating those contracts, when you're thinking five years ahead, you're not thinking 40 years ahead. Those are two very different ways in which you think about due diligence and contract negotiation.
As I said, we not only think in five years, we think 40 years out. Our strong belief is that over the long term, premium multiples are driven by quality, not by scale. Okay? You can have scale, but without the quality, you're not going to get that same premium multiple. Now, when we talk about quality, it's important to differentiate between the two buckets. One is the project lens, which is on the left side. We'll go through that in a second. The second is the investment structure lens, and that is on the right side. We'll go through that as well. In terms of the project, our approach is relatively straightforward, and I expect that a lot of people in the mining industry would say the same thing. We focus on low-cost, long-life assets with scale that attracts top-tier operators.
That's probably no different than a lot of our peers would say as well. We do take an approach not only looking at production; that is our priority, and we'll get to that in a second in terms of our pipeline, but we'll also look for longer-term optionality assets that we think are really good options. Spring Valley, Guy talked about it. We bought that in 2021, $26 million for effective 2.5% royalty. We just saw Wheaton purchase what would be an effective kind of 4.7%-6.4% royalty for $670 million. That's the difference. I think that's where we have the opportunity to get our guys out there ahead of time, Guy, Brendan, Matt, and find those opportunities to create deep value. On the contract side, I would say this is where a lot of the key differences are within the industry, quite frankly.
I'm going to steal a phrase from some of our larger peers. If you listen to Wheaton and if you listen to Franco, they'll say it over and over. Small structural differences can have major long-term value impacts. That's a real key point to make right here: the structural differences are within the contracts. I don't envy your situation. From a street's perspective, it's very, very difficult to understand those differences within those contracts. A lot of the time, you don't have access to them or you have access to redacted contracts. What I would say is one of the things that we can leave you with is, and it may be take away from this, think about what questions you want to ask and find those key questions to ask to try to find those differences.
Because when we think about a project, when we think about a contract, sorry, only 5% of that contract actually has to deal with what is being delivered to us and what are we paying for those deliveries. 5% of that contract. There is another 95% of that contract. We know that lawyers, they love to hear themselves talk. They love to build a lot of money. There is another 95% of that contract that has a lot to do with the underlying value of our asset, our contract. That is where we talk about building long-term value. Those small structural differences in those contracts can make a world of a difference. I will go through a couple of things here, and I am just going to kind of list them off, and I am happy to have a discussion afterwards with anyone that wants to have a larger discussion.
Things like security and guarantees, this is one of those items that's become very topical. People are starting to understand that there are differences within security and guarantees. Obviously, a secured interest is much better than an unsecured interest. Within a secured interest, there are multiple shades of gray. You can be first or second ranking. If you are senior, how much sub-debt can there be? What structural controls and restrictions are around those subordinated lenders? If you are subordinated, how extensive is the collateral package that supports that security? Are you going to be able to get through that senior debt before you start getting paid? How big can that senior claim grow to? We have seen this become a lot more important lately as hedge books have blown up because some of those secured hedges are senior.
Those are unlimited amounts that can become above you as a subordinated creditor. That is a really big important aspect to it. Another thing is, and we do not like it, it is part of the job, almost an evil part of the job, but what is the bankruptcy process in the host country? It is important because how much control do we have in bankruptcy and how much control do the courts have? Over a 40-year timeframe, as we look at this, there is going to be upsides in commodity cycles. There is going to be difference in geopolitical situation. There could be just an issue with the underlying asset. We did not look when we looked at Eagle, it is a great asset, and unfortunately, some operator error happened. You have to be able to manage those cycles and how is that going to work out?
Understanding the bankruptcy process, if you unfortunately get to that point, is important. The last thing I would say is, do you have guarantees and what security has been provided behind those guarantees? That is important. A parent guarantee is great, but it is only worth something if there are other assets that are binding that collateral. If there is nothing at that top parent other than a single asset developer, there is no difference from having a hold-go guarantee from a senior parent guarantee. That is security and guarantees. A couple more of the things that we look at: reporting requirements and audit rights. You will see with Brendan, we spend a lot of time looking, monitoring our assets, talking to our operators. We really do have great relationships with our operators, but we want to be able to get that information, have those conversations.
That led to, with Capstone, through Brendan's correspondence with them, them going back and looking at the silver, how they model the silver, and potentially getting a new resource model for that silver, which is great. Operational covenants. How much leeway does the operator have to change the business or the project plan from what was underwritten in that stream? We do not want to be the operators, and I am not suggesting we do, but you have to give them swim lanes because you do not want them necessarily walking away and saying, "Hey, okay, we are not going to build the mine this way anymore. We are going to build it half the scale after you guys just invested on a different mine case." Or what consent rights do we have? That is another option. Commingling rights. People talk about this now and again, but how stringent are those restrictions?
How much compensation do we get paid? This is important because that can drive as to where the operator is going to be focusing their long-term investment. Are they going to be investing within your AOI? Are they going to be investing outside the AOI? That goes to comingling rights. Transfer rights. This is a really big one. Over time, over 40 years, that asset is going to change hands. There are very few assets in this world that stay within the same operator forever. Who can own this asset in the future? That is a big one. We want top-tier operators. We want to make sure that those operators are operating to the best industry standards. If we do not like that operator that comes in, what is our recourse to that asset? A couple other ones I will list off really quickly are distribution rights and debt limits.
When can the operator take money out? Payabilities and offtake contracts. Are payabilities fixed? Are they floating? If they are floating, do we have any say under the offtake contract? That is really important when it becomes a byproduct credit because your alignment is not with the operator. They are slightly different. Completion tests, reps, and warranties. The list goes on and on and on. These contracts are very complex. We have teams of lawyers that look at these things constantly for us. That is why I say I do not envy the situation the street is in, but if you can get the right questions into these streaming companies, you start to understand the value with which that contract can have, some of these conditions in the contract can have to building long-term value. The next one I will speak about here, I know a lot of people have questions about this.
Certainly, it's one of the most topical on our conference calls, is the pipeline. What is coming in the future? One thing I should have said off the hop here is at OR, we split our business into two distinct business units. There's myself, Brendan, who came up here was talking about Mantos, and the team in Bermuda, our OR International. Our strategy and our focus is centered around streams, international streams, including new investments, portfolio management, metals trading. Iain, Guy, and the rest of the team in Canada, they're focused on investments in Canada and international royalties. So that's how we split our business. Many of the key considerations I'll talk to you up here are similar across both business units, but I'll let Iain jump in here if he sees any subtle differences. On the left side, you'll see I'm just reiterating what Fred had said.
A reminder, we have about $1 billion in total liquidity available to deploy today in accretive transactions. I suspect if we do not deploy any more money, we will be across that $1 billion barrier by the end of this year. We have not completed any big or flashy transactions in 2025, but I can assure you that our teams are extremely, extremely busy. We have been close on a few fronts. We have been down to the kind of eighth, ninth inning for another Blue Jays reference, Jason. We really stuck to our investment criteria, stuck to our disciplined approach, and we actually walked away from a few transactions that we had in hand this year because they just did not meet what we wanted. It is very important to note that we are very busy, and we will continue to look at a lot of things.
Iain showed you how many opportunities we've looked at over the last 12 months, and we'll kind of go through what our key considerations are here. The first item up here we have is expected returns. I'm going to actually do this one last because all these other things here that we talk about feed into what we think for expected returns or what guides our process to determine what kind of return we're looking for. Opportunity size, number one. We are seeing opportunities up to and including $1 billion. I think someone on the conference call said you could drive a truck through that. I agree. There is a very widespread in terms of what opportunities are out there today. Jason has been extremely consistent that as a mid-tier, our strike zone is really around kind of that $50 million-$500 million mark.
We will go outside of that for good opportunities. One example of that, Iain walked through a couple of them, but one example I'll touch on here is South Railroad. That was a $13 million check. It was an opportunity that we saw very quickly. We had good insight on the project because Jason and Brendan had previous experience with it. We jumped on it even though it was kind of outside that main strike zone. The other side of the coin, if we go up to the upper end of that spectrum of a billion dollars, we get very conscious about portfolio construction and how any new transaction fits into that portfolio. For instance, I do not think you'll see us go out there and spend a billion dollars on a new sportier jurisdiction in the world.
We do like to stick to our bread and butter, maintain our discipline approach. That said, we do have $1 billion. If we saw a good opportunity in a good jurisdiction that we're comfortable with, we do have the ability to kind of spend some big dollars here. Opportunity mix should actually have been up here in between opportunity size and structure. Really, at the moment, we're seeing opportunity centered around M&A financing and project financing. I would say that was kind of the bigger tickets at the moment. We're seeing a couple of portfolios still trickling out, and Iain especially has been working on a few of those. To a lesser extent, some balance sheet refinancing, especially around some of those hedge blow-ups. We are seeing opportunities where people are trying to look for some refinancing there.
I would say going forward, there will definitely be a slant, at least as what we see today, towards M&A financing and project financing. Structurally, outside of the contractual structuring that we talked about on the last slide, this structure here, what we really wanted to talk about was what are we looking at in terms of putting dollars out the door in what form. We have been pretty transparent in the past that we are looking at investing across the capital stack now. Our main focus will always be on streams and royalties, and that will not go away. We are seeing opportunities to get near-term producing opportunities with really good contractual terms by providing some of those other forms of capital as well, specifically debt and equity.
One thing I want to note here in terms of structure as well is that we're very cognizant of not over-encumbering an asset. We've seen some very large streams completed in this industry that fundamentally change that risk-reward profile of an asset over the long term. Again, our focus is building long term. What we want to do is make sure that an operator has sufficient upside to continue to invest in that project going forward, whether it's exploration upside, expansion upside, etc. That's something we take into consideration a lot when we're looking at structures here. Commodities, we've been consistent in our approach. It's a precious metal, pure play, precious metal royalty company. We have obviously looked at copper in the past. We have a stream on CSA. We will continue to do so in the right size and the right position.
That kind of copper angle, we will continue to look at. I won't close the door on every other commodity. There's always a right place, right time, right factor, but certainly it's not our focus at all today. Precious metals with a side of copper would be our focus here. Jurisdictional bend, I'm not going to harp on this one. Everyone knows we have the highest ratio of tier one jurisdiction assets in our portfolio. We will continue to prioritize our dollars there. Development stage, priority A is to acquire near-term producing assets, like I said, but we will continue to look outside of that into the development stage where we can find good deep value. Again, Spring Valley is a great example of that. Types of counterparties, very simple.
We want good trusted operators that have been there, that have done that, especially when we're going into new jurisdictions that we don't know. We would definitely want to be going into those jurisdictions with a partner that knows them very well. That all goes right back up to the top again to expected and required return. We get a lot of questions about this. When we think about our returns, the starting point is always risk-free rate and our OR's weighted average cost of capital. That mainly informed the WAC or WACC is mainly informed by the revolving credit facility. After that, what we do is we take a look at what type of margin or what type of spread we would want on top of that risk-free rate or that WACC.
That is very much determined by all those other things that we just talked about. There is no succinct answer to give you that this is the number for this and this is the number for that. There are so many factors that fit into the solution. We need to take into account all of the risks that we just talked about. We also need to take into account all of the risks that we talked about previously with respect to contract structuring. When you factor all of those in together, we generally, as a team, think about exactly what kind of spread we would need for all of the risks as those things add up. I should also note that first and foremost, people think about IRR, and I understand why, but we also look at more than just IRR.
We will also look at payback timelines vis-à-vis reserves. Are you getting your payback within reserve life? MOIC or ROIC, however you think about it, roughly the same concept. How does that impact our per-share metrics, PNAV, P-cash flow, etc.? IRR is one piece of a larger puzzle when we think about expected returns and rates. With that, I think, Jason, am I passing it back to you for closing remarks?
Yep.
Q&A now?
Yeah.
Yeah, we'll now proceed. Yeah, we'll now proceed with Q&A in the room. Please wait for the mic. We've got one over here. Just for the benefit of people on the webcast. Hey, Larry.
Thanks, Grant. Hi, this is Larry from CIBC. I just have a few questions. I can start off with a more topical one this morning. Last Friday, there was permitting news in Mexico. I'm just wondering, we've talked a lot about upside in terms of long-term growth potential. How does that kind of impact OR's long-term guidance? Are there any positive impact over there?
Thank you. Obviously, the situation in Mexico is fluid and complex. As we've said through the presentation, our preferred go-forward, we have some assets clearly in Mexico that I think everybody's aware of. We don't see any of those being of any risk based on the news flow that we saw last week. As we talked about in terms of our future opportunities, I think Mike went through a very good criteria of actually how we start to price these instruments. Our preference and our main filter as we look at instruments is really around ensuring that our jurisdictional profile continues to be best in class with respect to our peers.
Again, Australia, Canada, and the U.S. would take paramount when we actually start looking through those screens. I'm going to ask some of the technical folks if they also wanted to answer the question specifically with Mexico in the news that came out last week.
Just waiting here. Yeah, it's case by case. I think Mike explained it quite well where it's multidimensional. Mexico is not Canada, U.S., or Australia, so we take that into consideration. Mexico is actually a pretty big country with regional areas that have different risk levels. There's a lot to consider just beyond the permitting. There's also the risk on that permitting. Things change when politicians change sometimes. We look at it. We do look at things in Mexico, but we rank them case by case.
Awesome. Sounds good. I just have a second part question. It's more around more accounting base. I know we've talked about Osisko Development today and how that would impact potentially long-term guidance. Earlier this quarter, there was a disclosure that the accounting for ODEF has changed. I'm wondering how does that impact the geo-calculation? Would that be an upside or how should we look at the geo-calc over there?
Great. Great question. Thank you, Larry. I'm going to ask Fred to come up and clarify anything that I do say. But in short, it makes no difference in terms of the geo-calculation whatsoever. All we've done is we declassified our investment because we're obviously below the 20% threshold based on the Osisko Development financings. We sit just around kind of 13% on a pro forma basis when all those financings are closed. We have reclassified or declassified it as an investment and associate and reclassified it under other comprehensive income. There will be no P&L effect going forward. In terms of the GEOs that we are expecting to come out of Cariboo and the other assets within Osisko Development, there is no change. Fred, did you want to add anything further?
Awesome. Sounds good. Thanks again for taking my question and thanks for hosting us today, Jason and team.
Thanks, Larry. Thanks, Derick.
Derick Ma, TD. When you talked about the business development, you talked about the iterative process, you talked about the feedback loop. What are some lessons that you have learned from the feedback loop over the past 12 to 18 months?
I am going to hand it off to our corporate development team. Iain, Mike.
Look, I think you can hear me. There are a lot of lessons that we learn.
In terms of specific cases, I'm going to keep it a bit more general. But I think one of the lessons that we take home is, and this isn't, I'm not necessarily speaking about one of the lessons we learned in our process, but perhaps some other processes, is that intercreditor principles are key. When you look at things going into insolvency or on the brink, Mike made the comment whereby there are different levels of subordination and there are minutia in intercreditor principles that can really dictate what kind of cards you're playing with at the table when you're getting to that point. If I'm being as specific as I can without giving you the case study, but that was one that we looked at that we took a lot home from. I think Brendan might have others because he's the master of the look-back.
Maybe. Is this what? Yes. We do it regularly. Maybe I'll just talk to you about that. We do it at least twice a year. If we have something that is like a material miss or something big happens in the industry, we will have a look at it. We like to give it a bit of time so that when we do look back, it is more meaningful and some of the hot air has gone out of it. We look at how we did the due diligence in terms of could we have done it better. Did we predict it appropriately. We also look at the other end in terms of deal structure and all the rest of it. It is painful at times, right. We try and keep each other honest and ask really hard questions of each other.
At least I find it rewarding afterwards. Not during it, but afterwards you feel better about it. Yeah, that's about it.
Maybe let me ask one more. Sorry. Let me ask one more. You talked about portfolio construction multiple times and how you think about it as a portfolio. In terms of jurisdictions outside of Canada, U.S., and Australia, what else are tier one or tier one B jurisdictions that you're currently not invested in that you would like to be invested in?
That's a great question. I'll start and then hand it over to Iain and Mike who really kind of run through the strategy. It's certainly evolving, Derek. There's no question. As I said, those three jurisdictions are the ones that we primarily look at for assets. We do look obviously at other jurisdictions as well.
There's a lot of South American jurisdictions that we might not have significant exposure to currently. It will already depend on the region within South America as well. All that said, as Mike went through kind of the process of how we're pricing our instruments, that actually takes a big, big factor too. We do need to make a spread over our cost of capital. Yeah, I would say that there are some jurisdictions certainly that have generational type assets, a lot of porphyries obviously in South America that we'd really like to get exposure in. We're not going to go out and put instruments in at any cost. It's got to be a measured return as we've described. There are lots of opportunities out there that our team is quite busy in. I'll ask Iain to comment first.
Yeah, look, it's case by case. There are instruments that you can integrate into the deal that alleviate some of the risks in a jurisdiction that may be a bit more risky, like political risk insurance and things like corporate guarantees. It also comes down to the counterparty you're with. If there's a counterparty that has been in the jurisdiction for decades or is coming out of a team that is building a team that has deep roots in a jurisdiction and they've been proven to operate there, that gives one a lot of comfort in going into a jurisdiction with a group like that. It really comes back to the context in those four pillars. It's one of the underlying, it's one of the premise, one of the criteria by which we judge.
Maybe it's not a 10 out of 10 on one of those criteria, but it really comes with the context.
I think I was going to say the same thing about the teams. When you go into a jurisdiction that's not tier one, you want to be with a team that knows how to operate there. As Jason said, even countrywide, you need to split that down into region-wide. It's like very regional-specific expertise because it does vary significantly region to region.
The one thing I'd add is royalties are a bit different because sometimes you're picking up royalties that are already created. A lot of royalties are third-party royalties. There are some jurisdictions that are very good for royalties because they're treated as interest in land. There are some that they're basically just treated as a piece of paper that can be wiped in an insolvency. Even differences between Chile and Peru, for example, and different states in the U.S. We look at that very carefully. Especially if we're picking up a third-party royalty, the jurisdiction plays a key role.
Ingrid Rico with Stifel. Thank you so much for the presentation. There was a lot of detail here. I just have maybe two questions if I can. One on the assets under consideration for the sort of five-year outlook. Most are they're restarting the, I guess, remaining construction. As we think about the stream and the stream terms, can we assume that there's no renegotiation on the stream and that you guys are going to get paid on how the stream has been structured already?
Really, I'm going to hand that off to Mike because Mike spent probably the better part of the last three years of his life around Amulsar and the stream amendments. What I would say holistically, though, before he talks about that, we feel very comfortable, Ingrid, about the instrument that we have. If you actually look at the modifications that we made, it has very little, if not any, impact on the NAV as you think about the GEOs that we'll earn from that stream going forward. Mike, please.
Yeah, look, I think as part of getting the new debt in place and the new team in place, you'll see that there were amendments made to the stream at that time. We're very comfortable that that stream will be as is. That's a really good asset. It's just in a jurisdiction which has had some troubles politically.
The ASIC at this point in time is probably $1,500 U.S.. It is a high-margin asset at these prices. I would just point out that a couple of the amendments that we made that may not have come through is that there was a cap on it before and there is no cap on it now. There is a tail stream that got put on there. There also was a buyback on it, 50% buyback, and that has been removed as well. Those were kind of two big amendments that got made out of that stream. As Jason said, we are comfortable with the stream as it is today. We expect that once that $150 million is repaid, we will start to collect GEOs out of it.
Okay. Thank you. For Mantos Blancos, the silver grade reserve that I see on the presentation is much lower than, I guess, what has been so far. I guess just trying to understand a bit of the grade profile as OR sees it. Maybe if you have a number that you can tell us on what you expect on grade and recoveries going into 2026.
I'll try that .
Go ahead, Brendan, please.
Yeah, we have received the first cut of the 2026 budget and it's similar to what we're saying today. Six and a half. Yeah, six seven. There you go for all the ones that are teenagers. That's for 2026. The other thing I would point out or remind you is that there's a new technical report coming out in the first half of next year. I would refer to that in terms of more long-term and all the rest of it now.
Thank you for your questions, Ingrid. Go ahead.
Yeah, just on some of those opportunities that you missed out on, obviously you got outbid on some of those opportunities. Can you just talk maybe about the competitiveness that you see in the market? If you are obviously as positive as probably many in this room are on the gold price, do you relax those more stringent return requirements at some point to execute on some of these transactions?
Great question. Again, it is quite topical given where we are with respect to the commodity market. The short answer is no. We absolutely have to remain disciplined. Again, we obviously are not paid to prognosticate where the gold price is going for the next 5, 10 years.
The best information that we have is actually by folks like yourself and the strategists and the economists that work at your firms. That is a long-term consensus. We absolutely mark ourselves against the long-term consensus in terms of gold and silver price. What we do also do, if it is a near-term asset, is obviously there is a forward curve that we can price it off. Again, it is a bit of a hybrid. We will not sacrifice returns. You heard what the return threshold that Mike went through. We will not sacrifice returns. We have seen a number of deals that clearly in our mind, this is a bet on commodity price. As I said, three years from now, either these teams are going to look like absolute heroes because they got it right.
If the commodity rule, it might not be three years, it might be five, six years when people are looking and our accountants are looking at the instruments that they put in and there's potential write-downs happening. That's a position we definitely do not want to be in. We've also seen through the course of at least the last six months, but maybe a little longer, some of the structural components, i.e., the security that Mike, they're certainly being a little bit more and in some cases a lot more relaxed as to where we're comfortable. I think Mike did an excellent job presenting why we think and why we continue to believe it's not just, again, it's very hard to quantify some of these qualitative aspects around our security package. We always think worst-case scenario.
If a country blows up or if a country goes pear-shaped or if an asset does not have what is expected in terms of a technical report, what would happen in those scenarios? What would happen going through an insolvency process? What are our protections? We will not do anything naked. That has cost us deals as well. I think the short answer is, again, we are not going to compromise on either of those. If we are sitting here two, three years net from now and we still have not done significant deals, that is fine as well because unlike some of our other peers, we really, as you saw with the growth profile, do not have anything to backfill. We have got an exceptionally good growth profile that, again, is set up for the company.
I would say if we're in the commodity environment you're talking about, a lot of those options that we talked about that we're potentially moving forward into 2026, given the studies, given the margins, those will be accelerated. We've got this long-term of optionality that, again, I believe our shareholders will definitely be rewarded from. Excellent question.
Can I just go one step further and say that there were, in fact, three specific deals this year where we weren't outpriced on the deal. There was a structure that was put in place that there was a red line we drew and we wouldn't walk over it. In those instances, there's somebody willing to walk over that red line.
That's actually a great segue for some of the questions we have from the webcast. They're kind of asked, they're kind of very topical with what you just said, Iain. Kind of asked the same way, but one, when you walked away transactions, what you walked away from, what were the items that did not meet your criteria? Then asked another way, what top three items in your contract structure will you not compromise on?
I think the first one was already answered. We won't go unsecured, especially naked in a jurisdiction where we don't have interest in land. We can consider corporate guarantees in the right circumstance with the right counterparty. I'll let Mike answer the what was the second one?
Just the top three, what you walked away from, what were the top three items in the contract structure that you sacrificed?
I think some of it goes to the ones that I've already mentioned. When we look out 40 years, what risks are there in 40 years that we need to mitigate? I would say that security is a big one, and Iain just touched on that. I would say who's going to operate it is a big one too. At the end of the day, there's a very big difference in quality of operators. We want to make sure that a good quality operator that has the financial and technical ability to operate that asset is the one that owns it in the future. After that, I think it also comes back down to debt levels. That kind of ties into security, but what kind of debt levels can be put on the asset and where do they rank with respect to the stream or the royalty?
We need to make sure that that asset, the debt that's being put onto that asset is increasing the value of it as well. We want to make sure that all in all, whenever someone is sitting there with us, another secured creditor, they're adding to the value of that asset, adding to the value of our stream. I would say those are off the top of my head, the top three.
The other is on the intercreditor side. We have what we call our sacred cows, and there's two of them. One is on an enforcement event or under default, you're paid as operating expense. These insolvencies or workouts can last a long time.
If the royalty is stalled and they understand still over that period and not getting paid, those cash flows are accruing, but you do not know where in the ultimate waterfall they will flush out. The other one is called an attached sale provision whereby if you are a subordinated creditor and you are a royalty holder or a stream holder, that asset is going to go through a process and it is going to end up in the hands of a new counterparty. The senior debt needs to support your royalty or stream being sold in whole and to the full extent of the obligations to that new counterparty.
Thanks, guys. Just a couple more. These are from Scotiabank's Tanya Jakusconek, actually. Jason, Silver streams, Tanya is hearing there are some big ones out there to the tune of $1 billion. Would OR Royalties be looking to increase its silver exposure? Then separately, but also from Tanya, we said today that size does not necessarily mean better. Do we think our market cap is too small for generalist investors? Why or why not? Would we add to our silver exposure? Are we big enough to be on the radar for generalist investors?
Thank you, Tanya, for those questions through the webcast. First question on silver, as I think we have articulated and we continue to be consistent, we are a precious metals vehicle. We have no issue bringing more silver into the portfolio. Right now, as I mentioned in my remarks, at least from our third quarter, we are 30% silver. We do have a significant amount of silver in our portfolio. You are absolutely right, Tanya. There are some big opportunities out there for us.
You can think that we're trying to be competitive because it is incredibly competitive, as I mentioned, but along the same lines in terms of remaining disciplined and not overpaying and/or taking streams that, again, impair or don't provide us the appropriate security. In terms of our size, another really good question. Look, we obviously are a mid-tier. From a Canadian dollar perspective, from a market cap, as I think everybody knows, slightly over CAD 8 billion as of today. We've gone over CAD 10 billion in terms of market cap and CAD dollars. I think it's incumbent on this team, myself in particular, to start getting the message out there around this investment opportunity.
As I said earlier, royalty and streaming sector, if you did create an index, a synthetic index, it would have outperformed effectively the Mag 7, which is the barometer that the benchmark for the generalists out there. I encourage all the other CEOs and their investor relation teams in the royalty and streaming sector to obviously go out and tell the message because this is not a short-term phenomenon. There are multiples in terms of our trailing EBITDA as best as if you look across all industries. Rightly so. The last thing that I mentioned is clearly there is a bit of a consolidation theme that is happening in our sector right now. Obviously, Royal Gold stepped in and acquired both Sandstorm and Horizon, as I think everybody is aware.
You also have this new entrant called Tether that is looking to consolidate or roll up what we call the tier threes or the smaller cap royalty and streaming companies. Again, it's a really good question. If Tanya, if you have any advice for us to be able to get in front of some of the generalists and/or the players that you see as Scotia sees important, we're all ears and we're happy for you to take us marketing to see those folks.
Just a couple more. These are from Adrian Day. You just talked about it briefly, Jason, the theme of consolidation. Do you want to talk about that more generally, but also if there's any specific transactions that we looked at from a consolidation point of view, if we ever care to, and how come these transactions didn't happen if we walked away from them?
Thanks, Adrian. It's another really good question. Again, our team has been very consistent. Our company is open for business. Clearly, I think everybody has also heard myself saying consolidation is required in both the royalty and streaming sector as well as the gold operating sector. Whether we're the consolidator, which would be obviously our preference, we have to do smart M&A. We can't do M&A that dilutes, again, the per-share metrics that we're all compensated on. That wouldn't be the best situation. We also could be in a scenario or situation where we could be consolidated. What we would say, and I know, Adrian, we've gone through this before, but certainly our team is very acute and up to speed with respect to all the mid-tiers as well as the tier threes in terms of our view of value for them.
Put another way, we have a file on all these companies. If there is a continued consolidation theme, we will look to be active. As long as it does meet our metrics and be an accretive deal, you can think of that we'd be a player in, again, the consolidation theme that we expect is going to happen over the next 12-24 months.
Thanks, Jason. The last one from Adrian is, would we do more syndicated deals with one party or potential multiple parties working alongside us?
Yeah, another great question, Adrian. Syndicated deals, they're very rare in the royalty and streaming sector. The one that we did in 2024 with Franco, again, it was a very unique set of circumstances. It's obviously in Ecuador, a jurisdiction that we don't consider tier one.
To spread and diversify some of the risks across with, again, a major player was important for us to do. I think people were not aware, we also had a royalty, as did Franco-Nevada, and the Cascabel asset. It is not something that we went into without deep understanding and knowledge of that project. To answer the question, yes, we absolutely would be open to do more syndicated deals. Syndicated deals, however, I would suggest are in jurisdictions such as Ecuador or areas that we could structure around to ensure that we are protecting our shareholders. If you were not aware, the Cascabel transaction was essentially through a series of staged contingent payments as things progress and the asset gets de-risked. Certainly, we would look at syndicating those type of deals.
But again, the architect for that deal is sitting in this room here with Mike, Mike Spencer. Maybe you want to comment on that.
I think Jason hit all the high points there. It was a unique set of circumstances where we both had an interest in it. We both were interested in investing further. In Ecuador, for both of us, we wanted to spread that risk. I think it was just a unique set of circumstances. As Jason said, there could be other opportunities that come up, and we're certainly open for business to work with other people if it makes sense.
Thanks, Mike. That's it for those questions on the webcast. Jason, off to you for some concluding remarks. Look, thank you everybody for your time. We've gone a little bit over time.
I'm just going to wrap up by, again, the three takeaways that I started with. I'm hoping over the course of the last 140 minutes or so, you've got a pretty good lens in terms of our asset quality. We do think we have peer-leading asset quality. In addition, now that you've got some exposure to our bank strength here, our team, our talent density, I couldn't be more pleased with. We've got exceptional people at OR Royalties and will continue to obviously look at opportunities and create value for our shareholders. The last thing is just around optimism. Again, as I said, we're in an inflection point of OR Royalties.
We've got a very, very good growth trajectory as some of the assets that were more longer dated, actually, and the maturation of our portfolio as some of these assets mature and the studies get done and the funding comes in. We're just incredibly, it's such a great sector, the royalty and streaming sector. We're incredibly optimistic, and we hope that you as both shareholders, investors, and analysts and folks that advocate and share our view and vision are also very optimistic. Thank you very much for your time. The team here will, for the people in the room, the team here will stick around if you did have any specific questions for us. Certainly, please do. We're all very approachable, as I said. One of the things that we take really significant pride in is their access to the management team.
Thank you very much for your time. We look forward to doing this in another two years.