ESG Update

Jun 3, 2020

Slides

Ladies and gentlemen, thank you for standing by. Welcome to Teck's twenty nineteen Sustainability Review Investors Conference Call. At this time, all participants are in listen only mode. Later, we will conduct a question and answer session. This conference call is being recorded on Wednesday, 06/03/2020. I would now like to turn the conference over to Fraser Phillips, Senior Vice President, Investor Relations and Strategic Analysis. Please go ahead. Thank you, Melanie, and good morning, everyone. Thank you for joining us for Teck's sixth annual discussion of our sustainability performance. I'm joined today by our President and CEO, Don Lindsay, of course, and also by Senior Vice President Sustainability and Excel Affairs, Marcia Smith. We also have a number of other members of the tech team on the line with us today. We're looking forward to the first and second approach to ESG sustainability and and our performance. Before we start, I'd like to draw your attention to the caution regarding forward looking information on Slides two and three. This presentation contains forward looking statements regarding our business. However, risks and uncertainties may cause actual results to vary. Teck does not assume the obligation to update any forward looking statements. With that, I'd like to turn the meeting over to Donlin. Thank you, Fraser, and good morning, everyone. We have a lot to cover in this call, so I wanted to start by outlining our response to COVID-nineteen and our current business priority. We will provide a brief update on our new sustainability strategy, which is our vision short term goals for 2025 and long term goals all the way up to 2040. And then we will transition through a deeper dive on five g sustainability topics. I'll begin with an update on health and safety because the fact nothing is more important than the health and safety of employees and contractors. Looking at our recent health and safety performance, we saw an improvement in safety metrics year over year. And importantly, we've been able to reduce the rate of high potential incidents by thirty one percent, almost one third over the last four years. Despite our progress, though, in safety, we were starting to report the totality of the QB2 project in 2019. I should say that an in-depth investigation was completed and with preventative measures implemented, we are sharing less concerns across our company and all across the industry. COVID nineteen is clearly the most pressing health and safety issue in the We have a comprehensive approach to managing the risk and the impact of the pandemic based around five pillars, prevention, employee support, need for community, and public health organization, business continuity, and communication. All of our tech managed clients continue to operate, and we've implemented comprehensive preventative measures at our operations that are in line with guidance from health authorities. These include enhanced cleaning and disinfecting protocols, eliminating group meetings and requiring physical distancing, measuring shift part time to support the distancing, ensuring adequate supplies of special protective equipment, including masks, and promoting measures like frequent hand washing. Our people and our unions are working extremely hard to ensure these measures are being diligently implemented. And in fact, at just our steelmaking coal operation, we conducted over 28,000 assurance checks and achieved an impressive 98% compliance rate. We have maintained wages for employees whose work hours have been reduced because of COVID nineteen measures, and we are providing employees and their families with additional support, including access to specialized health resources and mental health support services. Lastly, I wanna take a moment to recognize and thank all of our frontline workers, these are men and women, for ensuring our communities are safe and have the services and supplies they need. In addition to our strong focus on our people and on their health and safety, we have also taken steps to ensure the resiliency of our business through this throughout this period. We are well positioned to weather the effects of this pandemic supported by our strong financial position. We have around $5,800,000,000 of liquidity as of April 20. Our $4,000,000,000 U. S. Revolving credit facility is committed through 2024, and it does not have a cash flow based covenant. Does not include a credit rating trigger, and does not include a general material adverse impact of foreign condition. We have no significant debt maturities prior to 2035, and we have investment grade credit ratings from all four credit rating agencies. And for our QB2 project, we have a prudent funding and financing plan in place. The $2,500,000,000 project financing facility and the QB2 party transaction dramatically reduced our funding requirements for the project. And there are no contributions to Project Capital expected to come back until mid twenty twenty one. Turning to slide seven. As we work to maintain the business continuity and the health and safety of our workforce, we are also working to support our community. We have created a $20,000,000 COVID nineteen response fund for communities, which includes procuring and donating potential medical supplies, such as 1,000,000 KNI Drive masks to health care providers and also supporting local health and social services affecting the COVID nineteen and contributing to relief efforts. That work builds on our well established approach to welcome global community priorities. For example, our support for health care aligns with our copper and health program. We've established copper and health several years ago to increase the use of antimicrobial copper to reduce the spread of health care acquired infections. Copper, as many of you know, has unique antimicrobial properties and is proven to continuously kill bacteria that cause infection. When installed on high-tech surfaces, copper will eliminate up to 99.9% of harmful bacteria. As a major copper producer, we believe we can play an important role in educating people about the use of copper to reduce the spread of infections like COVID-nineteen. We are also supporting international relief and regional organizations to protect food security. This aligns with the health program launched nearly a decade ago, so we are working with the United Nations World Food Program to improve crop yields and strengthen food security. Finally, we know some of the people who've been impacted the most by COVID nineteen are women and other vulnerable groups. And that's why we're working with UN Women and other organizations to support economic empowerment and provide educational opportunity. The extra steps we are taking today to respond to the many social challenges posed by COVID nineteen are rooted in years of working to improve the lives and well-being of people in our community and around the world. Our approach to sustainability is core to the success of our business. Strong sustainability practices are an essential part of our strategy to responsibly advance new projects, avoiding disruptions of operations, and attracting the best people. We also know that investors are increasingly valuing our company's sustainability performance in managing risk and supporting growth. It is our goal to be the leading diversified mining company when it comes to sustainability in ESG. I'm proud to say our efforts on sustainability have been recognized by a number of organizations. For example, in 2019, Teck was named to the Dow Jones Sustainability World Index for the tenth consecutive year, and we were the top ranked mining company on the index. We are also highly ranked on MSCI and Sustainable Limited in comparison to our peers. And we've been recognized as a strong performer by ISS, Digital Iris, Pussy for Good, and the Bloomberg Gender Equality Index. And we're proud to say we are also the only one company on the Global 100 Most Sustainable Corporation's list. While we are proud of our performance, we do know that there is still much more work to be done. Our work in sustainability aligns with leading external funding. And through our membership, for example, with the International Council on Mining Metals or IPMM, we conduct third party verification of sustainability practices in our operations. We also participate in global organizations to drive sustainability leadership. We have been producing GRI sustainability report for the past nineteen years, and we released for the first time an index aligned with the Sustainability Accounting Standard Corp or CASB standard this year. On climate change, we are members of the Carbon Pricing Leadership Coalition, and we are currently preparing our third report under the task force and climate related financial disclosure known as TCFT. In this next section, I want to provide an overview of our approach to business, which directly links to our sustainability strategy and performance. Slide 11, starting with copper, which is a critical metal for enabling the transition to a low carbon economy. Our copper growth strategy will see us rebalance our portfolio to make copper equal to or greater than our steelmaking coal business. As one of the lowest carbon producers of copper, we're well positioned for the ongoing electrification and associated decarbonization of the economy. We have a single platform of production with Silen Valley copper mine in British Columbia, Carmen de Andacollo mine in Chile and through our joint venture interest in Antamina in Peru. We have growth opportunities as far as the IT team is offering starting with QB2, our long life low cost Chilean operation that's currently in the construction phase while construction is currently suspended due to COVID-nineteen. Combined with the transition to a low carbon economy, as part of our commitment to be a net zero carbon company for 2050, we are working to store 50% of our electricity demand in Chile and clean energy in 2025 and 100% in 2030. Moving now to our steelmaking coal business. We have strong long term cash flow from our four long life high quality steelmaking coal mine. We have more than thirty years of reserves and over one hundred years of resources. Our steelmaking coal operations have consistently delivered higher operating margins than many other major steelmaking coal exports. As you know, steelmaking coal is a critical component in the production of steel, which is needed for everything from hospitals to clean power. We are amongst the lowest carbon intensive producers for steelmaking coal in the world, positioning us well to transition to a low carbon economy. We also have a strong focus on managing water quality at our steelmaking coal operations, which Mark will speak to in more detail later in the presentation. Turning now to our zinc business unit. Zinc enhances the durability of steel, and it is also an essential micronutrient for human health. Teck has a world class new business with our flagship Red Dog Mine, one of the largest high grade bank producers in the world. We operate Red Dog under an innovative operating agreement with the landowner, Nana, a regional Alaska native corporation owned by the Inupia people of North West Alaska. And the operation is currently located near the bottom of industry top curve year after year. And turning to our energy business, we have a 21.3% interest in the Port Hills oil plant operation, which has amongst the lowest carbon sensitive oil production in the oil plant, lower than half of the oil refined in The US today. It features proven technology and has an experienced operator with Suncor. We have been very careful that if we can't see value for Courthouse reflected in our share price, we will not hesitate to pursue other options to realize the value, including divestments at the appropriate time. Now how does all this fit together? Well, our strategy is very straightforward. We're implementing a growth strategy with financing cash flows from our steelmaking coal and zinc businesses. We are focused on rebalancing our portfolio to ultimately make our copper business larger than our steelmaking coal business, beginning with coal and QB2 in Chile, which will double our copper production on a consolidated basis. And then rebalancing our business towards copper does align with the shift to a low carbon economy, is a global sustainability priority for all businesses in government. As we advance this strategy, sustainability will remain forefront with everything we do with our ambition to use sustainability goals guiding us along on the path ahead. With that said, I will now hand the call over to Margaret Smith. Great. Thanks, Dawn, and good morning, everyone. I'm gonna cover a few ESG and sustainability topics, and then we'll open it up for questions. And as Fraser said, obviously, Don and I are here, but a number of our colleagues are on the line with us as well today. So Texas had a comprehensive sustainability strategy in place for nearly a decade. We updated the strategy first in 2015, and we released the second update a few months ago in early March twenty twenty. On this most recent update, we set ambitious goals in '8 strategic themes from health and safety to biodiversity to climate change. These team has long term objectives with short term milestone goals that are called us. Moving to slide 18, I'm gonna start with climate action. We know that we have a responsibility to help tackle the global challenge of climate change, And we do this by working to reduce our emissions at our operations, by advocating for policies that support the transition to a low carbon economy, and by responsibly producing materials that are essential to building the technologies and infrastructure needed to reduce emissions globally. The carbon intensity of our operations is already very low within our industry. And as shown in the graph here on the slide, the intensity of our scope one and scope two GHG emissions on a copper equivalent basis is amongst the lowest in the industry. Further, the majority of our business is always covered by carbon pricing. But unlike many of our peers, the cost of carbon is always factored into our cost structure. Earlier this year, we set the goal of being carbon neutral across all operations and activities by 2050, and we came in and demonstrates our support for the transition to a low carbon economy and worldwide efforts to meet the goal of the Paris Agreement to limit global temperature increase. It also aligns with commitments made by our primary operating jurisdictions of Canada and Chile to commit to being carbon neutral by 2050. And underpinning this objective are three short term goals. The first is to reduce the carbon intensity of our operations by 33% by 2030. The second, as Dawn mentioned, is to secure 50% of our electricity demand in Chile from clean energy at 2025 and a hundred percent by 2030. And third is to accelerate the adoption of zero emission alternatives for transportation by displacing a footprint of 1,000 internal combustion engine vehicles by 2025. Moving to slide 20, we have set out a road map for how we will reduce carbon intensity and ultimately achieve our long term objective of carbon neutrality. We first start first start with a solid understanding of our current and our future emission sources, and then we apply the mitigation framework. So this framework has four steps. First, avoid emissions altogether where possible. Second, eliminate emissions through the use of alternatives such as solar instead of coal power. Third, minimizing emissions. And fourth, using carbon offsets if needed. We know that our two most significant emission sources are from power supply and from our mobile equipment fleet, such as haul trucks. So we prioritize those sources and our short term goals and are deploying proven, cost effective technologies to make progress now. So this includes completing procurement of electricity for operations from clean energy sources. And earlier this year, we announced a major purchase agreement for our CVT project in Chile that will source renewable energy for approximately half the power required for that operation. We're also replacing internal combustion engine vehicles with zero emission alternatives with a focus on electric transportation and alternatives for material handling. And as you can see on this slide, as we move forward, we will evaluate and implement options to address other sources of emission. For example, we're considering lower emission alternatives for stationary combustion processes, such as in our steel making cool dryers, and more definitely the potential for using emerging technology such as carbon capture and storage. At each stage, we're looking at what possible types of technologies are available and proven now that we can begin implementing. And at the same time, we're monitoring early stage technologies as they mature towards commercial viability. I've got just a minute on slide 21 about an area of active technology development, and that's something called the clean staker vehicles initiative that we advanced through the International Council on Mining and Metals. 27 of the world's leading mining companies, tech and mining equipment manufacturers, are collaborating to develop a new generation of mining vehicles with a significantly reduced environmental footprint, including lower greenhouse gas emissions, reduced diesel particulate release, and decreased chance of collisions. I'm on slide 22, and I'm gonna talk for a moment about water stewardship. We have been, and we will continue to focus on innovative water management and water treatment solutions to protect water quality. And we continue to focus on transitioning to seawater or low quality water sources in water scarce regions. For example, this means using desalinated seawater for our QB two project, which is located in one of the driest places in the world. One of our key priorities is managing water quality at our steelmaking coal operations in the Elk Valley Of British Columbia. We've discussed this topic before on this call, and I'm pleased to say that we're making good progress. To address the challenge, kept working partnership with governments, indigenous people, and surrounding communities to develop the Elk Valley water quality plan, which was approved by our provincial regulator. We're advancing a range of innovative technologies to achieve the objective of the plan. And as part of that work, we developed a new form of water treatment called saturated rock fill, which is gonna help achieve water quality objectives more quickly and at a lower cost. And saturated rock fill, or SRS, this is called them, use naturally occurring biological processes to remove soil, aluminum, and nitrate from mine affected water. The first full scale for us is to test retrieving up to 10,000,000 liters per day and achieving near complete removal of chlorine and nitrate. We're currently holding the second phase of the subclera, which will double water treatment capacity to 20,000,000 liters per day. We have one tank based facility operating successfully, and we're currently constructing a second larger facility at our Gordon River operation. And moving forward with planning for all future water treatment facilities to be SRS. We have a major r and d program underway to continue, for example, including our options for source control. This includes advancing our work to reduce nitrate at source through the use of explosive product liners, and you see that picture here on the slide. Moving now to slide 24. As you can see in this chart, we have a clear path forward for implementing the Elk Valley Water Quality Plan and improving water quality. As disclosed in our q four twenty nineteen results press release, we anticipate spending Canadian 640 to 690,000,000 from 2020 to 2024 on water treatment in North Valley. And this will be a total treatment capacity increase to a 120,000,000 liters of water per day. And, ultimately, it will ensure that the water jet is protected and that we can continue to sustainably operate our mines in that region. I'm gonna shift on slide 25 now to tailings management. And the safe management of tailings dams and facilities is a critical importance for our company and our industry, especially in light of the tragic incidents at both Brumadinho and San Marco. Teck manages 16 active tailings facilities and 39 facilities that are closed and no longer receiving tailings. To get comprehensive systems and procedures to ensure the safety of our facilities, organize around six levels of protection as outlined on the slide. Our accounting facilities are operated and maintained to meet global best practices for safety, including industry leading protocols established by the Forest Sustainable Mining Program or TSM and the Canadian Dam Association. And our facilities also have full emergency preparedness plans in place, which are received with local stakeholders. The most recent annual GAM safety inspections facilities, which are available on our website, confirm that they are stable and secure and that our monitoring and surveillance practices are robust. And many on the call will also be aware that last year, the Church of England Pension Board and the Swedish Council on Ethics saw additional additional disclosure on tailings, and you will also find that detail on our website. In 2019, we undertook a special review of tail textile and water retention structures following the Brumadinho incident. That review was conducted by independent external experts who provided their report to the safety and sustainability committee of our board. They confirmed that there are no immediate or emergent types of catastrophic failures without killing clean water down. Nevertheless, we are focused on maintaining our management practices and ensuring that our facilities meet the highest standards for safety. And finally, will say that planning is underway today at tech to fully implement the new global accounting standard that has been advanced by the principles for responsible investment, the UN environment program, and the ICM has finalized and released. So moving to our next topic on slide 26. In today's increasingly complex operating environment, capitalize on developing positive long term relationships with community. And this begins with acknowledging and respecting the human and indigenous rights of the people that we interact with. In 2019, we had no significant human rights related to community incidents. And last month, we released our updated human rights policy, which emphasizes our commitment to the UN guidance principle. Most of our operations and the majority of our development projects are located within or immediately adjacent to indigenous people territories. And so currently, we have formal agreements in place with indigenous peoples at all mining operations. We believe that agreements form a framework for relationships, they build a foundation for cooperation, and they support ongoing engagement. Indigenous community support for our activity is also contingent upon sharing economic benefits, and that's why we're focused on local employment and procurement. In 2019, we spent 225,000,000 on procurement with indigenous businesses, and 72% of our workforce is local. The 46% of our procurement is coming from local suppliers. We're moving here to slide 27. I wanna spend just a moment talking about inclusion and diversity. And this is an issue that is very much at the top of our minds right now with recent events that have both shocks and sadness. And it's clear that as a society, we need to do more to combat racism and keep each other safe. And at times, we recognize that all employees have a right to work in an environment that supports diversity and is free from discrimination and harassment. And that's why we have a strong inclusion and diversity policy, and we work to actively implement our global harassment policy and our code of ethics. We also recognize that the world is evolving in the light of COVID nineteen. And while we have a number of family friendly policies and programs in place, we are working towards an expanded remote work policy to further enhance workplace flexibility. On gender diversity, we've implemented programs to attract and retain a greater number of women women at tech, and we're seeing progress. In 2018, women comprised 32% of new hires at tech, about one third of all our new hires. 25% of independent directors on our board are women, including our board share. And women now make up 20 of our total workforce, up from 14% just five years ago. We put a place of range of projects and programs to promote inclusion and diversity across our company. And finally, we ensure that no matter the topic or the concern, employees can raise them in strict confidence at any time through our twenty four seven doing with right pipeline. Accountability for sustainability performance is embedded throughout our company. Our compensation program is directly linked to sustainability performance through individual, department, and company wide objectives. At minimum, performance against sustainability related objectives affects at least 10 to 20 of an individual's annual bonus. And businesses also have sustainability metrics built into their bonus structure. As you might expect, executive compensation, including my compensation and Gong, and our business unit leaders' compensation, can also be a close one to sustainability. In particular, with the safety and well-being of our people, our relationship with communities where we operate, our use of energy, and our carbon intensity, and environmental impact. And our sustainability performance is tracked on an annual basis, especially as it relates to our sustainability goals, and it is reported in our management cost restructure and our sustainability report. And for more detail on our sustainability performance, we have a range of ESG resources available for investors. On our website, you can find our annual financial and sustainability report, our TCSC aligned report, and more. All of our sustainability data is available, and as Don mentioned, it's also available with our new strategy index. We also provide them for CDP and UN Global Compact report. And all of these resources are available on our online disclosure panel, which we update update throughout the year with new data as it becomes available. And when it comes to sustainability, we are focused on continuing to improve our social and environmental performance as a key element for our business and long term value creation strategy. And this will mean a safer and more diverse workforce. It will mean less carbon emissions and a reduced environmental footprint, and it will mean even stronger relationships with communities and indigenous people. And with that, we would be happy to answer your questions, and I'll turn the call back, Melanie, to you. Thank you. Once again, please press 1 at this time if you have a question. There will be a brief pause when the participants register. Thank you for your patience. Once again, please press star 1 at this time if you have a question. The first question is from Greg Brown of TD Securities. Please go ahead. Yes. Thank you. Mark here. That's slide 24 on the Elk Valley water treatment plan. I think that's the first plan we've seen. Is that all of the water treatment that you require in the Elk Valley mapped out there? And is I assume that the way you've mapped it out, I mean, that the government is on-site and in premise for all the factories at Rockville facilities will happen. Yeah. I'll Greg, and then I can turn it over to Robin. He's on the call too. But, yes, that does outline our our plans for water treatment. And, we do have support from government for proceeding with our strategy on saturated black hole. I don't know you wanna add anything. I'm I'm not sure what to add, but I agree. I think that was just the chart itself gives a pretty good sense of what the plan is, and it's pretty much locked down now. So as far as you said, we've got approval to I mean, we're in the middle of constructing the first such or the largest expansion, the factory at Rockville, and I'll keep that's probably the capacity there. So I'm not sure what to add to that. I think my understanding, Robin, was that the government was studying this and trying to figure out if they were happy with the way that the tax rate was was still formed and stripping out the Slovenian. But I I guess with this plan, that is all taken care of now that you agree with you that the best move going forward. Yeah. I would just say, Greg, you know, as I said in in my in my remarks, I mean, the ultimate capture at Russell is achieving near complete removal of turning the nitrate. So he is achieving what we set out to do, which is to, you know, get water treatment online quicker, and it is obviously more cost effective for us. So I think, you know, all systems are well. As I said, we made a lot of progress since we we talked about this a year ago, sort of on this on this call. Okay. Okay. Thank you. You're welcome. Thank you. The following question is from Karen Orson of GSO. Please go ahead. Thank you, operator. Thanks for the presentation and all the all the details. Maybe it's concern for your topic with the COVID and other issues. Just just actually this question goes back to some of your previous competitors in the industry who don't have this anymore for their product. But you know, that's copper alloys and copper sulfonyl bacterial, antimicrobial properties. He I'm I'm actually amazed all through this pandemic how little publicity has gotten in in the public forum. Doesn't matter if it's the news channels or the business channels or the industry journals. Is there is there anything else that with your leadership you can do to either brand it in such a way that it becomes a preferred high value competitor product? And also, as well, I I was going back to my notes and look at the zinc stripe issue, you you say this very well about the it's effect on the on the fertilizers and also usage for learning ability and so on and so forth. Is there a branding way or pricing in such a different way that people have to pay it to get it? It's cheap. People think it's just not worth it. So how how can we take the next step or buy? It becomes a recognized product. Not only as it is, but from product itself. Thanks. Terry, thanks very much for your question. It's a really important point for society at large. I'll I'll start with the commerce though and then throw it open to any of your colleagues who wanna jump in. You know, we have been pushing it at tech with our corporate health programs for a number of years now, and and we funded the installation of copper composite material and contact surfaces in the intensive care unit for Vancouver Dental Hospital where they've been testing it. And and there's a number of aspects that these people still need to learn about in terms of what the effect of different cleaning agents are over the course of a year or two. But so far, it's it's just had excellent results. We're now supporting it going into, I think, four more hospitals so far. And we've been, you know, educating people and pushing the story on a number of fronts. We have seen, during COVID nineteen, numerous media reports. I get a report sent to me by a a friend or colleague or somebody almost every day, from some media outlet. But you're right. There's still a lot of institutions going, particularly with government that would fund major investment infrastructure using copper. We did see Toyota, a Canadian Honda of Manufacturers, they were reopening. They applied cost to their high touch surfaces and railings and so on as part of the COVID nineteen restart protocols. But, really, we'd we'd like to see that everywhere. And and also in public transit, health care facilities I mentioned, but, you know, restaurants, turnovers, you name it. For society at large, it would reduce the risk of infection and and, you know, make it safer for people to carry on with the normal life that we used to have. So those are some thoughts. I think the National Caucus Association has a program pushing it, but but you're absolutely right that this is an opportune moment to to get that story out and and have governments really start to act as a requirement for building infrastructure. But I'm sure it opens because anybody else has has what do wanna add? It's Mark. Yeah. Maybe I would just add, Don and Terry, Terry, as part of our COVID response fund or $20,000,000 fund, we have allocated actually a million dollars for Coffer and Health in 2020, and that is designed to do exactly what you what you just suggested, which is to increase awareness of Coffer and infection in infection control management. So we are looking at projects, and we'll continue to invest in trying to raise awareness so that people understand both at government levels and as we as I mentioned, as we've been moving through the health care sector in Canada. And, you know, there are other options that people don't think about, like, copper clothing is getting more and more popular. I I obtained copper laced masks for my family, and and there's several manufacturers of those now. But you everything from copper gloves to copper socks and and so on. So but I guess, by branding it or just getting that that message, I'll call it the 12%. Well, I mean, there's two ways of branding. One is the copper itself. One is the tech itself. I think it this conversation goes with the Inco. I'm a tell you this a year ago. And Caterpillar came with their boots and toys and everything else. Inco has an opportunity to get into the Inco. They understand. Inco does Inco that. And they looked into that. What can be tech? What can be why there should be anybody else? And you get multiple on your copper price or whatever it is. Because you go to home, you could today buy a copper alloy tube for a kitchen, and you're paying $10 a pound. Weight has to be, like, $200 a pound giving it away. Okay. We're gonna look into that. That's an interesting idea. I remember the income statement. It's all. Thank you. Thank you. The following question is from Oscar Cabrera of CIBC. Please go ahead. Hi, Oscar Cabrera. And I'm just calling on, you know, same question thing that Terry has done. Call the call industry and the and the oil industry are are getting a pretty bad luck with investors in terms of the environment. And so and you have touched on this a couple of times, but it is it is it good to to hear what would you have planned? I'm referring to the type of call that you produce versus the promo coal, which I think the most of the comment would you like the environment to come from? Alright. So it's a good question and there's no doubt that it's education issues that we have been working on. So first of all, wanna make it for both our production in the oil sands and our production steelmaking coal, we are at the very low end in terms of carbon emissions per ton of production or barrel of production. And I think it's important that as the world, you know, moves the energy transition, which we strongly believe in that while there's still gonna be a need for oil, we wanna have barrels of oil that have the lowest carbon emissions associated with the the barrels that that should be producing in the highest emissions barrels should be the ones that that that are shut down. In terms of steelmaking coal, I mean, steelmaking coal is crucial for a low carbon future for for the world. And it's a it's a story that we have been working hard from probably September, September till November. Pedro and I saw literally hundreds of institutions, and it was extended to reach me till January, making sure people understood the difference between who's still making call and verbal call. And I could say now that probably 98 or 99% of investors do understand the difference, but they just worry that someone else doesn't understand the difference. In fact, pretty much everybody does understand the difference. We still have to keep pushing that story probably in every investor meeting that we do have. And and also with the medium margin and the population at large. But, you know, if if you want a low carbon feature on this planet, you can't you can't do it without the field for everything from hospitals to for our health care, rapid transit, for lower footprint, for windmills, and so on. So I think, collectively, you all have to do that to make sure people understand that. Right. And and then if I may, there's been an increase to spike in cases of COVID nineteen in South America. I was wondering if you could provide an update of of what's happening in Q B 2 and the, you know, getting people back to construction status for that. Okay. We are making some progress there. I'm gonna turn that over to, I think, Dale or Alex. I see Dale on the line. I'll take Dale over to you. Yeah. Thanks, Don. Currently, we remain suspended for construction. We do have a fair maintenance staff, and we do have a small number of critical activities that are that are progressing on-site. And we're spending a lot of our time focused on what it would take to do a full restart in construction. We're obviously monitoring the situation for COVID in the country and and in particular in the Tarapika region, including medical capacity. A lot of our workers come from across the country. And so it's not just work at that site, but it's the transportation of workers that, you know, we're concerned about as well. So now construction remains suspended. Some people activities carrying on, and we're continuing, especially at this time, while Chile is still still peaking for COVID cases while watching the the country very carefully in in the region. Thank you all. Thank you. Following question is from Carlos De Alba of Morgan and Chairman. Please go ahead. Thank you very much. Good morning, everyone. And so, Marsha, on on referring to the city that slide 22, can can you elaborate a little bit more as to what are the water scarf regions that you have identified? Is it mostly Peru and Chile? Any more color would be appreciated. Thank you. Yeah. We're really referring to to Chile where we have our, you know, our q d two project and from that quote. So we have operations in Chile that we that we manage. And so that is that is largely what we're referring to in terms of our goals. But, of course, if we, you know, if we brought projects on in in other water scarce regions, like Peru and in other places, we would apply these goals to them as well. Thank you. Thank you. The following question is from Derek Smith of Gmail Global Asset. Please go ahead. Jamie, alright. Everyone, I've checked this also to speak well during the during the pandemic. Very excited to rate your new business. Melanie, it looks like maybe we have Derek coming out. Yes. Mister If, if you could press 1 again. I'll open your line again. I do apologize. Sorry. Once again, if you could press 1. You may not otherwise have used to mute it, I guess. His line is now open. Please go ahead and assist. Hello. Can you hear me okay? Yes. Yes. Thank you. Hi. Sorry. Yes. So first, just read your new business university report and the presentation as well as you have made a set of new and important strategic priorities in water, carbon and selling. And we did actually welcome the carbon neutral commitments on climate change, which I think covers scope one and two. I'm quite curious about your your views on the scope three emissions And and whether you have done any accounting on that as I can see on slide 18 that currency, it is kind of hidden from that when you compare with this year. If there is any timing on talking on that on on the scope of this emissions, we'll be very keen to hear more of the details. Thank you. Marci, I I missed part of that question. It was breaking up a bit. Did you get it? Yeah. It was breaking up for me too. I think I got it, which which was Derek, I think you're asking if we have any specific scope three emissions goals. And while we don't have any specific goals at this point around scope three, it's obviously something that we're paying a lot of attention to and we're looking at. And as I mentioned in our in our comments, we are looking at and, you know, following technologies like carbon capture and storage and and trying to understand those those as well. We are seeing, of course, you know, steel mills are looking very closely at at their emissions, and so that's something important that we're following. Maybe I'll I'll turn it over to Chris Adaptive who's on the line with us as well for more color. But but I would say in terms of a specific goal at this point, we do not we don't have a specific scope three goal, but, obviously, this is an area that that we're watching very closely, and and we'll see at some point if there is a goal that we can play in the thinking about scope three emissions. I don't know, Chris, if you wanna add anything? Just just one minor note I'd add, which is we we have been disclosing scope three emissions for for the most material. So three emissions are sustainability report. So that information's been in a number of reports for a few years. But, yeah, I I just just so so you said, Mercia, which is, you know, we are monitoring this. We are looking at what the field sector and other sectors are doing and keeping an eye on where those opportunities are going to emerge. Okay. Thank you. The following question is from Michael Pooh of System Analytics. Please go ahead. Hi. Good morning, everyone. Thank you for the presentation. Hi, Chris. I wanted to, one, make a a quick correction. You mentioned in the opening slides that you were tied for second in the same latest ratings. And I would say I'm looking at the April ESG risk rating report we've done, updated the controversies, and you're number one in diversified metals. So congratulations there. My question follows on from Derek's a little bit more looking at the responsible steel initiative and also the I'm sure you're aware that the PPI paper on Scope three and and carbon pricing for diversified metals. And I'm curious as to how you are contributing to those discussions at RSI on the double counting for coal and and iron ore, because I know you're not in the iron ore. And then how that also translates into the and I see you're already going to the copper equivalent or carbon diversified metals. So how you might be navigating and contributing to those discussions as far as establishing the standards go? Yeah. So so thanks. I'm gonna I'll I'll start, and then, Michael, and then maybe Chris can jump in as well. And also maybe Katie Satysenko who's on the line with us. So we are just actually in the process of of joining responsible field. We've been talking to them since the very, very early days and have spent quite a bit of time early on talking about the standards and, you know, in particular, standards like CFM and how those might be integrated. So that's a conversation. I'm trying to think how long it's been going on. Maybe two years? I I mean, mean, maybe it's not that long. I can't quite remember. But we have been talking to them for a long time, and we are now, as I say, in the process of of more formally joining them. And so we can continue to work with them and others now that that's where we're getting some traction. And, yeah, maybe I'll just turn that maybe I'll turn over to Chris and Katie if they have any more color to add on sort of how we're thinking about some of these issues. Yeah. Thanks, Marcy. It's Chris. And, like, thanks for the question. Yeah. I mean, we're we're tracking both, and and I know exactly what you're talking about the double counting. You know, we've we've joined some of the conversations with the TTI to see how they're going through their accounting. It's something we'll continue to monitor and engage in, make sure that we're providing some contributions so that they can make some reasonable decisions in the end of methodologies. But I think it's it's still a process that they're they're working through. Right. Okay. Yeah. I just thought you guys are are kind of settling the line there, one on the the precise metal side, but also then on the certification and their their sourcing on the raw materials for the steel side. And I know they're looking and talking with them, and they're having the discussions on the the double counting. So that's all I was just concerned. I'm sure you guys are on top of it, but just wanted to see how you're thinking about it. Thanks. Okay. Thanks. Hopefully, yeah, I think, as I said, this is is definitely an an evolving area that we're we're involved in. Great. Thank you. Thank you. The following question is from Anne Marie Daniel of BC Investment Management. Please go ahead. Bonjour. Initially, my my question related to to the scope three emission reduction target as I was tackled already, but I will follow-up with you know, just just to say I think that it it's been great for you to to update your your long long term due to emission reduction target for 2030, providing investors and stakeholders with with more visibility towards the milestone to to meet your your your net zero aspiration by 2050. And and the plan for carbon neutrality also provides much more nuances and and visibility into how you're going to to meet those objectives. But I think the next step, new considerations to to come up with even more of a milestone project to to 2040 on on the emission reduction front? Hey. I'll start on that one, and then proceed to jump in as well. We we are just in the process, Melanie, of working with our business teams in fact, Dale and Robin who did our base metals and and so making cool units. And the team, we just sent a a session, I think, this last week, talking about our implementation plans how those will unfold at the site level. So, you know, I think I don't think we have a plan necessarily today to develop more milestone goals. We've got the ones set in front of us right now. But, you know, 2050 is a long time away. And I think, you know, the world is changing pretty rapidly. We have consistently been updating our sustainability strategy sort of over, you know, four to five year increments. So I fully expect that as this unfolds, we will be making those kinds of updates as we head towards, you know, 2030, 2040, 2050. I don't know, Chris, if you wanna if you wanna weigh in there. Nothing really major to add. The only thing I'd say is, you know, as you said, we we do update the strategy every five years. So at those times, we try to set, you know, both short and long term goals within the 2030, as you mentioned, and we showed that bridging. So I think, you know, that that 2030 goal was set to align with with sort of Paris trajectory type action. And so I think that's gonna be continue to be our focus the same way that that's why we set the carbon neutral goal to stay along that pathway. Thank you. Thank you. The following question is from Karen Thorsman of DSO. Please go ahead. Thanks. Actually, just just a quick follow-up. Few years ago, I asked the same question. I just kinda wonder. I'm just wondering if the if the progress is such a way that we can help whether again the old sustainability, accolades, recognitions, that's that's great. And and just for the legacy and the existing issues, I'm looking to for the future. However, could you say that today, because all this efforts that tech put on the table, has it impacted the timeline to keep the permits faster than anybody else? Are you a partner of choice? Permits will get that texting that that's a great company because all these efforts they do. That means your financing is at the lower cost. Your cost of capital is impacted. Is it just for metrics that are you using saying that this is where we achieve and we gotta do more or we have enough be done? Thanks, Terry. I think it's an excellent question. And I'll start and maybe Marcio or others could could follow. You know, we do get a very good reception, and then we have a strong dialogue with governments all over where we operate. And it's a high priority that that we maintain that rate from, you know, my office throughout the different management, chair board every now and then, and so on. You have to start with relationships and quality dialogue, whether it be with the community, business people, government, and shareholders for cost of capital. We put a strong emphasis on that. But it is difficult to measure whether if if we weren't ranked entirely or we hadn't adopted, you know, the leading practices, their cost of capital would be higher, you know, whether it be share price or interest rates on debt, that sort of thing. But I think it's it's more about access to capital markets and ability to get a permit at all. You know, there have been many projects around the world that did not go ahead because they never did get the permits and everything to community acceptance, and they didn't have good quality dialogue with the government. And we had some of those right here at British Columbia. So probably the the next success is is being able to continue to operate and to to, you know, sometimes get a growth venture permitted. Whereas if if you didn't, you know, meet the highest standards of of practices and sustainability, you'd probably just not be able to continue. Marcia or any others on the team, any any other comments on that or any evidence that shows that it does make a difference? Yeah. Maybe I would just I would just sort of add to that, Don. I mean, I think we see I think we see the impact of our sustainability practices in a couple of ways. One is certainly is in recruitment. We consistently consistently hear that people so from, you know, whether we're recruiting at the senior VP level to the front lines, we we consistently hear that people wanna join our company because of our sustainability practices. So I think, you know, that that's a positive and it helps us on that front. When it comes to permits, just to sort of add what John said, I think a big part of it is building trust with regulators, building trust with, you know, indigenous communities. And I would say that, you know, in our operating areas, we we do have strong levels of trust. Mean, certainly, here in British Columbia, you know, all of you who've been following our water quality plans, and Greg mentioned them earlier. You know, this is a very complex trial, and we have a high level of engagement with the British Columbia government on it, with the Ktunaxa Nation on it, with our communities on it, and we've been able to work through that, you know, so far so good. I mean, we are, you know, continuing to operate and to solve some pretty complex problems together. And and so, you know, I I think it is hard to put to to kind of nail that in a very specific way. But if you it's on to if you look at if you look at companies that aren't able to proceed, you know, I think that that's maybe that these would waive measure. And and then maybe just the last thing I would say is a lot of what we're talking about here, you know, our approach to talent management, our approach to climate change to, you know, inclusion and diversity, these are becoming for regulators, certainly in the Canadian and Chilean context. These are becoming table stakes. Like, if you cannot, you know, live up to a certain bar, I I think the reality is you will not get permits going forward. So yeah. I don't know I don't know if that really fully answers your question, but it's it is an area that is absolutely, I would say, evolving. It's evolving significantly over the last few years. If you think six years ago, on this very first call that Dom and I did, we sat at the end of our presentation and looked at each other across the table because we didn't have a single question from anybody, from our sustainability performance. And today, you know, we're spending hundreds and hundreds of time. We're getting lots of questions. And so I think that the focus on ESG performance is, you know, is just growing and increasing. And I think, ultimately, this is gonna translate into advantage to those companies that can demonstrate their operating at the highest level. You know, because we we cover a lot of companies, most of my colleagues on this call and and the industry. I think tech has a story to tell. And the question is, you deliver it to your benefit for all those issues. I'm not sure you are. And don't don't let it go away because the industry becoming, as you said, marketing and on, being very selective. The other side, the governments, the competitors, they wanna deal with the credibility issue. And you're hired. I think I'll use that leverage as much as I can. Thanks. Oh, thanks very much. I don't know, Fraser, if there's any other questions or, Melanie, whether we've got more on the line. No. I I don't think, at this point, we do have any more, questions on the line. So I think, Marcia, we can hand it over to Don for closing remarks. Okay. Well, thank you, Peter. Thank you, Marcia, and thank you all for joining us today. We appreciate the questions. We appreciate your input. And if you have any questions that you think about afterwards, please don't hesitate to contact us. And if you have any suggestions, some good ones here today, we'd love to hear those as well. We look forward to doing this again next year, and we remain absolutely committed to to maintain the the rankings that we've been having and and to continue to raise the bar on all things sustainability. As I close many meetings at Tech, I'll just say this, sort of my mantra. If I repeat it often enough, I hope it all comes through. Please, to all of you, stay healthy, keep the faith. This too shall pass, and all will be well. Thanks very much. This meeting is adjourned. The conference has now ended. Please disconnect your lines at this time. Thank you for your participation.