Hello, ladies and gentlemen. Welcome to the 2023 Annual Meeting of Shareholders of McEwen Mining. Please note that today's meeting is being recorded. During the meeting, we'll have opportunities for questions. You can submit questions or comments at any time by clicking on the Q&A icon. To enter your question or comment, compose your question or comment in the lower field provided on the rights, on the right of the screen, and click the Send to submit. During the presentation, you'll be able to follow the slides on the left-hand side of the screen. To extend the slides to the full browser view, click the broadcast icon at the top right of your screen. To return to the reduced view, click any icon at the top right corner of the screen.
We will now begin the formal part of the meeting, which will be followed by a company presentation. It is now my pleasure to turn the meeting over to Rob McEwen, Chairman and Owner of McEwen Mining. Mr. McEwen, the floor is yours.
Thank you, Operator. It is my pleasure to welcome you to McEwen Mining's 2023 Annual and Special Meeting of Shareholders. Following the formal portion of the meeting, we'll provide you with a brief presentation featuring a number of our officers who are with us today, and many of our directors. I will now hand the formal part of the meeting over to Carmen Diges.
Thank you, Rob. Good afternoon. My name is Carmen Diges, and I'm the General Counsel and Corporate Secretary of McEwen Mining. At Rob's request, and in accordance with our bylaws, I will act as Chairman for the meeting, and Stefan Spears, Vice President of Corporate Development, will act as Secretary. A representative from Computershare will be acting as scrutineer for this meeting and is also in attendance, along with many of our directors and our directors of McEwen Copper. Welcome, everyone. Today's virtual-only meeting is a live webcast. As we believe in engaging with our shareholders, we hope this virtual meeting will maximize the participation of shareholders regardless of their location. This technology enables us to reach a larger audience and encourages your participation. Thank you very much to everyone for participating in our virtual meeting today.
We'll now consider the election of directors for the ensuing year at this meeting, as well as proposed amendments to our second amended and restated articles of incorporation to increase our authorized capital, as well as the ratification of the appointment of our auditors. For convenience, certain persons have been asked to propose and second resolutions. You don't need to vote if you've already voted by proxy, unless, of course, you wish to change your vote. All owners of record as of the close of business on April 28, 2023, are entitled to vote at this meeting. Those wishing to vote would have received a ballot when they registered with the scrutineers and will need to sign in using the link provided online and their 15-digit control number provided on the proxy card or notice of availability of proxy materials previously received by you.
Should participants wish to post a question or comment, they will need to click on the Q&A icon above on your screen. Our Vice President of Corporate Development, Stefan Spears, will be managing questions for this meeting. Any questions pertaining to the business of the meeting will be addressed today. A complete list of owners of McEwen Mining as of the record date for the meeting, April 28, 2023, as required by Colorado law, has been on file at McEwen Mining's office and was open to the inspection by any owner at the corporation's principal office and upon request by email since May 8, 2023. The list is also available online for inspection by any owner during our meeting.
I have an affidavit from Computershare Trust Company, our stock transfer agent, attesting that the notice of this meeting, proxy statement, annual report on Form 10-K and proxy, were mailed or made available to all shareholders of record as of April 28, 2023, in the manner prescribed by law on May 8. Copies of these documents are available today to any owner who would like them. If you would like a copy of the annual report or proxy statement, the links are provided online. There are a total of 47,427,584 shares outstanding and entitled to vote at this meeting. I've received the interim inspector's report on attendance. Our articles require 1/3 of the outstanding shares entitled to vote at this meeting for a quorum, and on that basis, I declare that a quorum is present.
I also declare that this meeting is duly convened. The first item of business is the appointment of the scrutineer. I have appointed Computershare Trust Company of Canada to act as scrutineer for the purposes of tabulating the votes at our meeting. The next item of business is the approval of minutes of our last meeting, held on July 7, 2022. Copies are available for inspection by any interested owner. With your consent, I propose we dispense with the reading of these minutes. Is there any objection? You may submit objections or questions online by clicking on the Q&A icon in the upper right of the meeting's screen. Stefan, any questions, objections?
No objections.
Thank you. Thanks. The polls have been open for voting since May 11, 2023, and will remain open until 5:00 P.M. Eastern Time today, as declared in our proxy statement regarding this meeting. We will vote on these matters by online ballot and provide an interim result of voting on each item at the end of business today. Management believes it has sufficient proxies to carry each of the proposals, and as such, the outcome is expected in favor of management's recommendations. If you did not vote by proxy and intend on voting at the meeting, and you have not yet been informed of the procedure for online voting, please read the online voting instructions available to shareholders by clicking on the Documents icon of the meeting screen.
The first item of business is the election of directors to serve until the next annual meeting of owners and until their successors are duly and elected and qualified. Mr. McEwen, McEwen Mining's Chairman and CEO, will now recognize the seven persons nominated for election to the board of directors.
Thank you, Carmen. The board has nominated the following persons to serve as directors of the corporation, to hold office until the next annual meeting of McEwen Mining and until their successors are duly elected. Allen Ambrose, Richard Brissenden, Robin Dunbar, Merri Sanchez, William Shaver, Ian Ball, and myself, Rob McEwen.
Thank you. Is there a second to the nominations?
I second the nominations.
Thank you, Mihaela. The corporation has received no other nominations for directors in the manner prescribed by the corporation's bylaws. I therefore declare that the nominations for directors are closed. Is there any discussion regarding this matter? If so, please communicate using the Q&A icon on your screen.
No.
Thank you, Stefan. We'll now move on to the next item of business. The next item of business is the proposal to authorize an increase in the total authorized shares of preferred stock to 10 million, and a corresponding increase to 210 million in the total number of shares that the corporation is authorized to issue from time to time. As stated in the proxy statement prepared for the purpose of this meeting, the adoption of the preferred stock amendment would provide the corporation with the flexibility to issue shares for financing and other business purposes in the future. Currently, the corporation is authorized to issue 2 million, sorry, 200,000,002 shares, of which 200 million are designated as common stock.
Only two shares were designated as preferred stock. These have been issued and subsequently canceled and retired in line with the articles of incorporation. The preferred stock amendment is outlined in the proxy statement prepared for the purpose of this meeting and attached as Annex A to the materials. If you'd like a copy of the proxy statement, the link is provided online. I'll now call for a motion on the proposal.
I move that the following resolution be adopted. Resolved that the proposed amendment to the second amended and restated articles of incorporation to increase the authorized capital to 10 million shares of preferred stock, to make a corresponding increase in the total authorized shares, and to make other conforming changes to the corporation's articles, be ratified and approved.
Thank you very much, Rob. Is there a second to the motion?
I second to the motion.
Excellent, Mihaela. You've now heard the motion. Is there any discussion regarding this matter? There being no questions or points of discussion raised, we'll now move on to the next item of business. This is the ratification of the appointment of EY (Ernst & Young ) LLP as auditors and independent registered public accountants of the corporation for the year ended December 31, 2023. The audit committee and the board of directors has approved the appointment of EY (Ernst & Young) LLP and recommends ratification of their appointment. Robert McEwen will make the necessary motion to approve the auditors.
I move that the following resolution be adopted. Resolved that the appointment of EY (Ernst & Young) LLP, as the corporation's independent registered public accountants for the year ending December 31st, 2023, be ratified and approved.
Thank you very much, Rob. Is there a second to the motion?
I second the motion.
Thank you, Mihaela. You've now heard the motion. Is there any discussion? There being no questions or points of discussion, we'll now move on to the next item of business. If you have not voted or wish to change your vote, you may do so now by clicking on the Vote link provided online. Any shareholder who has already voted and does not want to change their vote need not take any further action. As we said at the outset, the online voting will remain open for you until 5:00 P.M. Eastern Time, and the final tally of the vote and report on the ballot by the scrutineer will be published on the SEC website and on SEDAR within four business days of the meeting and in the minutes of the meeting.
Based on the preliminary review of the votes cast, the election judge has informed me that all nominees for the board of directors have been elected, the amendments to the second amended and restated articles of incorporation to increase the authorized shares of the corporation has been approved, and the appointment of EY (Ernst & Young) LLP as the corporation's auditors has been ratified. We will safeguard any ballots, proxies, affidavit of mailing, oath and certificate, and report of inspector, and save them with the records of this meeting. On the basis of the scrutineer's report, I'm pleased to announce that Robert McEwen, Allen Ambrose, Richard Brissenden, Robin Dunbar, Merri Sanchez, William Shaver, and Ian Ball have been elected as the corporation's directors. The amendments to the authorized shares of the corporation have been adopted.
The proposal to ratify the appointment of EY (Ernst & Young) LLP as the corporation's independent registered public accountants for the year ending December 31, 2023, is approved. Thank you. Are there any other items to be considered at this owners' meeting? If not, I would entertain a motion to terminate the meeting for McEwen Mining.
I hereby move the meeting be terminated.
That's your favorite part, Rob. Mihaela?
I second the motion.
Thank you. Unless anyone is opposed, the formal portion of this meeting is now terminated. I declare the meeting terminated. Thank you for your attention. I'll now turn the meeting back to Rob McEwen, who will chair the remainder of our meeting today.
Thank you, Carmen. Let's talk about McEwen Mining. We have good real estate, large land positions located in prolific regions of the world with the right mix of metals that I believe are important for the future of the modern world. Gold and silver to provide monetary protection, and copper to power the energy transition. Over the past 18 months, the steps we have taken are having a very positive impact. As you can see on the chart... Which is going to come up in a minute. There it is. Our share price is up 130% since the beginning of September last year, and has outperformed the prices of gold, silver, copper, and the GDX, GDXJ gold share indices. As well, and perhaps surprising to many, McEwen Mining has also outperformed the broad market, as measured by the DJIA and Nasdaq.
I believe this is just the beginning. I've personally invested $220 million, and I'm determined to see it grow. Management is dedicated on building value for all of our shareholders. Value that hopefully will drive our share price beyond its earlier highs. We are on a course year-to-date to deliver 12%-28% increase in our gold and silver production and at a lower cost than last year. Recently, we strengthened our balance sheet by reducing our debt by 38%. I feel we are now in the right lane to step on the gas and start passing the competition. We believe exploration is a critical engine for growth, and as such, we have continued to invest significant funds exploring at both the Fox Complex and McEwen Copper's Los Azules project.
The resultant discovery of resources near surface and at depth has provided us with the confidence to embark, later this year, on a major development at our copper at the Fox Complex, the Stock Mine. At Los Azules, its copper resource has continued to expand, clearly highlighting its world-class nature. A third area of growth is our Fenix project. Last summer, we purchased a used process plant that has reduced significantly the projected capital costs and payback period of our Fenix project. As a result, construction will start later this year, with production expected to start 12 months later. On the financial front, I'm pleased to say we expect to generate sufficient cash flow to fund the development of the Stock Mine and the Fenix project without having to do an equity financing. Based on...
This is based on assumptions that the current gold and silver price hold, and that we deliver on our projected production levels and cost per ounce. During the past 18 months, the biggest change has occurred at our subsidiary, McEwen Mining, McEwen Copper. We successfully completed two private financings totaling $267 million, where approximately $220 million went into the treasury of McEwen Copper and $47 million into the treasury of McEwen Mining. The first financing was done last August at $10 a share. The second financing had two closings, late February and early March, and was done at approximately $19 a share, a 90% increase in value. As a result, the implied market capitalization of McEwen Copper jumped from $257 million to $550 million.
Through these financings, McEwen Copper welcomed two significant shareholders, Rio Tinto, the world's second-largest mining company, and Stellantis, the fourth-largest automobile manufacturer and mobility provider. To our knowledge, Stellantis' investment was the first direct investment in a copper project by an automobile manufacturer anywhere in the world. A great endorsement for our products. The big news last week for us was the release of the updated preliminary economic assessment for Los Azules. The highlights were a bigger resource base, robust economics, production cost per pound in the lowest quartile for the industry, massive copper production, and a long mine life, while only mining one -third of the resource base. This mine could go on for many generations. I'm very excited about this project because this mine is being designed to be distinctly different than a conventional copper mine.
Los Azules will be using 100% renewable power source, consuming far less water and emitting much less carbon. Our objective is to be carbon neutral by 2038. Los Azules is being designed to be regenerative, very green, environmentally responsible, and to be an attractive place to work. We sincerely hope that Los Azules will become a model for new mines and will contribute to improving the general public's perception and exception of mines. Now, let's watch this video. It's an introduction to Los Azules.
McEwen Copper, leading the way in sustainable copper development. As a subsidiary of McEwen Mining, McEwen Copper is an active copper project developer in the Americas. Our flagship project is the advanced Los Azules project in San Juan, Argentina, which was ranked ninth largest undeveloped copper project by Mining Intelligence in 2022. The second asset is the early-stage Elder Creek project in the U.S. Committed to innovation and sustainability, we are seeking to contribute to shaping the future of the mining industry. In 2022, we secured a $25 million investment and forged a partnership with Rio Tinto through its Nuton Technology Company, aiming to further improve our business. We closed an agreement with Rio Tinto, optioning a 60% interest in Elder Creek through an investment of $18 million over seven years.
Rio Tinto, a global mining and metals leader, is a vital partner in the development of our assets. In a historic step for Los Azules, in 2023, McEwen Copper secured a game-changing ARS 30 billion investment from Stellantis, the first automotive manufacturer directly investing in a copper company, acknowledging copper's critical role and our position amongst copper developers. We closed a second agreement with Rio Tinto, securing an additional $30 million investment at a significantly improved share price. These developments increased McEwen Copper's implied valuation from $257 million to $550 million, evidence of our rapid progress and growing potential. At Los Azules, we assembled a team of industry professionals with over 180 years of collective experience in exploration, construction, and operation at top-tier mining companies, prepared to drive McEwen Copper's success.
In line with our dedication to the development of San Juan and our project, we established new offices in the capital city and community affairs offices in Calingasta, the municipality of our project. This year, we submitted to the authorities of San Juan, the environmental impact assessment for construction and operation. Developed by the engineering and consulting company, Knight Piésold, the report incorporates the expertise of 50 national and 22 local professionals with knowledge of engineering, environment, local regulations, and the social and cultural baseline of the province. In June 2023, McEwen Copper announced the results of an updated preliminary economic assessment for Los Azules, including an increased copper mineral resource estimate by 7% for indicated and 38% for the inferred category, compared to the previous estimate from 2017.
Of the 39,927 meters of drilling of this campaign, 22,252 meters of drilling from 49 holes will be included in the resource estimate for the upcoming feasibility study, further upgrading the resource. Highlights of the PEA: 401 million lbs average annual copper cathode production during the first five years of operation, and 322 million lbs over the 27-year life of the mine. $2.6 billion after-tax net present value, 21% internal rate of return, and a 3.2 years payback period at $3.75 per lb of copper.
8.68 billion lbs total copper recoverable to cathode, $2.5 billion initial capital expenditure, $1.07 per lb of copper, average C1 cash costs, and $1.64 per lb of copper all-in sustaining costs. Average EBITDA per year of $1.01 billion, years one through five, and $692 million, years six through 27. Compared to 2017 PEA, fresh water consumption is reduced by 75%, electricity consumption is reduced by 75%, GHG emissions are reduced by 57%, with paths to further reductions by implementing new technologies, with the goal of reaching net zero carbon by 2038, with some offsets. We developed regenerative guiding principles to reframe the approach to sustainable mining.
The project seeks to significantly reduce mining operations, environmental footprint, and associated GHG emissions by integrating the latest environmentally responsible technologies and processes, supplying 100% of its energy from renewable sources. We are striving to have long-term positive impacts on the ecosystem, local communities, while contributing positively to the economy of Argentina. Los Azules, gateway to a sustainable future. Join our journey!
Well, I hope you like that. I believe Los Azules has the potential to create the largest amount of value for MUX in the near future. Today, you will hear from members of our senior management team about our progress and plans for the future. Perry will lead off with the financials, followed by Bill, who will discuss the improvements at our operation. Sean, Kevin, and Stephen will cover off exploration at Fox, Gold Bar, and San José Mine, followed by Michael, who will expand on the advancements at Los Azules. I will conclude with thoughts on what we believe our underlying share value is, and after that, we'll invite your questions. Perry?
Thanks, Rob. Good afternoon, everyone. I'll provide a brief overview of our financial results and highlights for 2022 and the first half of 2023. A lot has transpired since we held our last AGM, so on my two slides, I would like to highlight the differences from where we were in the first half of last year to where we are now. Overall, I believe we have made tremendous progress from both a financial and production standpoint, and we believe that the markets and our shareholders appreciate the turnaround, as reflected in the share price data that Rob showed earlier.
Starting first with our cash position, we reported a major increase in our cash balance at the end of the first quarter, and will continue to report a sizable balance in our second quarter report, with the majority of our consolidated cash held in the accounts, McEwen Copper, following the significant transactions completed over the past 12 months. We will report a somewhat lower balance at the end of the second quarter, reflecting Los Azules' project spend and a shift to allocate a portion of our Argentine peso holdings to short-term investments to mitigate inflation and devaluation risk. Turning next to debt. As Rob discussed, a year ago, it was necessary to increase our debt position by $15 million to $65 million to cover shortfalls as a result of operating challenges, particularly at our Gold Bar Mine in Nevada.
Fast forward to the current quarter, you will see that we recently repaid the full amount due to Sprott Lending of $25 million, thereby reducing our total debt load to $40 million and reducing our annual interest costs significantly. Further, we have amended the repayment terms on our remaining debt to defer principal repayments until 2025, which will allow us additional flexibility to undertake the important capital projects, which Rob discussed earlier, including our Fenix project in Mexico. Next, looking at equity financings. We have not issued any flow-through shares, or any common shares for that matter, over the past 12 months, and our outstanding share balance in McEwen Mining is unchanged from a year ago.
Instead, as discussed by Rob, we raised money via our McEwen Copper subsidiary from our key strategic partners, Stellantis and Rio Tinto, in order to complete the recently released updated PEA on Los Azules and provide initial funding towards the work required to complete the feasibility study, which Michael Meding will discuss further on. In addition to the primary share issuances, McEwen Mining sold just under 10% of its interest in McEwen Copper and secondary share sales to provide financing for our treasury and to repay our debts. Turning to financial metrics, we generally use cash gross profit, and more recently, adjusted net income, as the most meaningful measures of our gold operations.
As U.S. GAAP accounting rules require that we include in our reported net income the significant expenditures at our Los Azules project, which overwhelmed the gross profit we report from our gold operations. U.S. rules, unlike International Financial Reporting Standards, or IFRS, require us to expense these costs until, at a minimum, we have completed a feasibility study on the project, which is not expected for at least another 18 months. Looking at our cash gross profit, we are pleased to report that in the first quarter of 2023, Fox and Gold Bar generated $11.3 million in cash gross profit alone, compared to $5.4 million for the first half of 2022. We expect our second quarter 2023 cash gross profit to further improve compared to the first quarter.
Finally, looking high level at our production statistics, we reported first half production this year of 66,000 gold equivalent ounces, which is roughly a 7.5% improvement from the first half of 2022. If we go to the next slide and look at the details, look at our production in a little more detail. This slide shows what our production was in the first quarter of the year, our first half estimates, and where that compares to our guidance range for the year. Further below, we show our associated cash costs and all-in sustaining costs. Bill and Stefan will go into these results in a little more detail, but overall, I can say that we are on track to meet production guidance at Fox Complex.
We are slightly behind at Gold Bar due to extreme winter and spring conditions earlier in the year, but are making solid progress towards catching up to guidance. Similarly, at San José, they also experienced a slow start to the year, but have made good recent progress to catch up. If we look at our costs and all-in sustaining costs, at the Fox Complex, all-in sustaining costs for the first quarter were $1,311 per oz, versus guidance of $1,320 per oz, so we were where we want to be. At Gold Bar, we were at $1,725 per oz versus guidance of $1,680 per oz, so about 3% above, but we expect that to come down as production increases.
At the San José Mine, we were well above where we want to be at $2,234 per oz, compared to guidance of $1,550 an oz, or 44% above. As Stefan will discuss, now that production has come back more in line with expectations, we expect cash costs and all-in sustaining costs to come down considerably. I'll turn the presentation over to Bill.
Thank you very much, Perry. Good afternoon, shareholders. Today, we are happy to report our operational and financial results, as Perry has pointed out, have been continuing to improve over the last year, will continue to get better based on the improvements we have made in our operation. First and foremost, we must thank all of our employees for their effort and perseverance through many challenging times over the last year, since, you know, through COVID and many other things, including forest fires in Canada these days. This thanks also goes to our suppliers, consultants, and contractors, all of whom are instrumental in our success. At this point, I would say our people have worked through many challenges to put us in a position to be successful this year.
Successful operations are built on a foundation of safety, planning, budgeting, and flawless execution, with proper risk mitigation for the unexpected. We will have a good second half of the year and a good year overall. The future of McEwen Mining looks very good. Next slide, please. No, last slide. Okay, we're good. Thanks. Employee success or employee safety is a key to our success. At both the Fox operation and in Nevada, we are now at 18 months without any impactful injuries to our crew. This is after a challenging winter in Nevada and some other unexpected events that happen on a day-to-day basis in most mining operations. On the positive side, in May, our mine rescue team at the Fox operation participated in the Ontario Mine Rescue Competition and did very well.
One of our new members was declared the winner of the Rookie of the Year award. This is a very good commitment or demonstration of our commitment to safety in all of our operations. With our values as a focus, we continue to impact our operations in a positive way. In the second half, costs will improve over the first quarter and the first half of the year. We see this continuing as we move forward. During 2022, continuing into 2023, we made considerable improvements at Fox in our mining operation and in our budgeting and cost processes, which have led to better operations. We are now processing 1,400 tons per day through our mill versus 1,000 tons per day in 2022.
Fox production will improve from 36,650 oz in 2022 to approximately 46,400 oz in 2023. This is an improvement of over 25% on a year-over-year basis. Our underground operation and development work at the Froome Mine will now allow Froome to continue at least until mid-2025, and hopefully a little bit longer. At present, we also have a stockpile of ore on surface of approximately 120,000 tons. The stockpile will generate an imputed value of $15 million after we run it through the process plant. At the same time, we are investing $14 million in diamond drilling exploration at Stock and at Gray Fox, Gray Fox being the mine that is slated to follow Stock.
We have a succession of mining operations which go from Froome, to Stock, to Grey Fox, which is, should sustain us into the future. At the same time, at Gold Bar, we have successfully transferred to a new mining contractor. Gold Bar produced 26,620 oz in 2022, and this will improve to 42,600 oz in 2023, assuming that we can hit all of our marks as we move forward. Gold production in the second half, in the second quarter rather, was a little bit lower than we planned. However, we now have a plan to make up this difference as we move forward through the rest of the year.
Overall, as Perry mentioned, costs are tracking pretty close to our cash costs and our AISC costs, and these will improve over the remainder of the year. In terms of our future, we are planning the Stock Mine to be the next after Froome. As I mentioned earlier, this will be followed by Grey Fox. Sean will give us an update on our exploration endeavors, both at Stock and at Grey Fox. In short order, in the second half of this year, we will get a resource and a mine plan for the Stock operation, and we hope to start the initial ramp access into the mine in Q4 of 2023.
There is one particular zone that Sean will describe in the upper part of the old Stock Mine, which looks like the starting point for our mining operations, which will get started in mid-2024. An interesting aspect of the Stock Mine is that the ore is considerably softer than the Froome operation. We anticipate that this will allow us to improve production through the process plant by at least 25%. This will significantly impact our production of gold and help with our cost management. At El Gallo, as Rob mentioned earlier, we plan to remine a 10 million ton leach pad. We plan to do this at approximately 1.2 million tons a year.
At the present time, we are engaged in engineering, design, permitting, and sampling of this leach pad, and we have a plan to start mining in the second half of 2024. The execution of this plan should generate approximately $10 million of free cash flow per year as we move forward. For these reasons, we think the future is good. Thank you very much. Now over to Sean for some description of our Canadian exploration work. Thank you.
Thanks, Bill. Thank you, Bill. Good afternoon, all. Our Fox Complex is ideally situated in the highly prolific Abitibi Greenstone Belt, along a fertile transect of the Destor-Porcupine Fault Zone, which is denoted by the black dashed line in this image, with abundant subordinate blade structures, which are key for the presence of robust gold mineralization. This year, we earmarked $14 million in flow-through for both exploration and delineation at our Stock and Grey Fox properties. Next slide, please. In 2022 and continuing into 2023, we executed an aggressive drill campaign at Stock Main, which is primarily within 200 meters of the historical Stock Mine, in order to identify mineralization in close proximity to the proposed ramp system we've driven to Stock West.
Multiple lenses have now been delineated, including mineralization, as Bill mentioned, near surface, adjacent to the proposed Stock West ramp entrance. This mineralization could provide early key revenue during the initial phases of ramp development. We continue to intersect deeper in mineralization, that is to say, greater than 600 meters below surface, indicating that the Stock system remains robust, adapted with good grades and widths. An example would be drill hole S21-202, which graded 4.3 grams per ton over 20 meters true width. Another hole, approximately 50-60 meters down dip, S23-306, which had 30 meters of azurite-bearing green carbonate, which I will show you on the subsequent slide.
Geological modeling has now identified at least two principal plunge vectors of Stock that appear to control most of the mineralization systems, as you'll see on the following slide. Next slide, please. I would like to first draw your attention to the two principal plunge vectors identified for Stock. The first one is the mine vector, which is the shallower one that you can see to the left, and then the steeper one, which we call the N2, which is named after the easternmost chute at the historical Stock Mine. Good results are demonstrated within both plunge vectors and offer us opportunities for resource growth, including those deep intersections that you see in the middle of the page, S21-202, and assays pending for S23-306, and provide us additional opportunities for early mining horizons.
In addition, two underexplored areas are also exciting to us because they might represent longer term potential for the overall Stock West project. Next, we will look into the intersection of an intriguing new zone located within the black dashed box, which may give us early access to mineralized material for the Stock West project. Next slide, please. I just want to point out to you that the mine headframe and mill are connected and very close. Recently, drill holes SM22-110 and SM23-145 highlight some of the results seen for this area, where the mineralization remains open. An infill and expansion program are currently in progress. Next slide. Here are some examples of the coarse visible gold from our shallow ramp portal zone drilling.
It is notable that most of the VG logged occurs within or at the margins of abundant gray quartz carbonate veins that are hosted in ultramafic rocks. In this case, a gray carbonate on the left and a green carbonate on the right. Next slide, please. Drilling at Stock West was mainly concentrated on de-risking the project through resource conversion and exploration growth. It also became apparent that mineralization continued at Stock West along a shallow southwest plunge, where the main system appears to be splitting into multiple lenses, but still returning mineable grades and widths. Recall the intersection seen on the Stock longitudinal for S22-255W2, which returned a grade of 3.2 grams per ton over a width of about 14 meters true width.
As was previously mentioned, much of the drilling was focused on identifying mineralization in proximity to the historical Stock Mine and proposed ramp system to Stock West, in order to enhance the 2022 PEA outlining potential early mining horizons. These robust results indicate mineable mineralization could occur relatively early in the Stock West project. A final note, a year-end resource estimate for Stock Main delineated approximately 30,000 oz of gold. Next slide, please. We are very excited to return to Gray Fox this year, which is our greater than 1.1 million oz deposit, sitting approximately 3 km to the southeast of the producing Froome Mine. At least four new veins consisting of six sub-deposits to follow up with good drill results from mid-2022.
At least four new vein systems were identified at Gibson, one of the Grey Fox sub-deposits, highlighted in blue, in proximity to the historical Gibson ramp, which is denoted by the thin brown line in the center of the deposit. Those examples would be Grey Fox, 22 Grey Fox 1365, and 22 Grey Fox 1366. There is opportunity to continue to find new discrete vein systems at Gibson, which has a current resource of more than 100,000 oz of gold, and to explore to the northwest of Whiskey Jack, which is highlighted in red, where the current resource is nearly 80,000 oz of gold. Together, they make up only about 15% of the total indicated resource for Grey Fox, but represent its most attractive growth and exploration potential. Next slide, please.
At McEwen Mining, we're always keen on examining new technologies which would aid us in all aspects of our mining exploration activities. Multiple department validation studies are currently underway, which include the use of LIBS, which stands for laser-induced breakdown spectroscopy, which is being used successfully in places like Australia and holds great potential for optimizing our exploration, mining, milling, and milling operations. It is noteworthy to mention that the mineralization of Stock appears to be softer, as Bill mentioned, than at Froome, based partially on the LIBS data, which has favorable cost implications. I will now pass the presentation on to Kevin Kunkel for an update on exploration at Gold Bar. Next slide.
Great. Thank you, Sean, good afternoon, everybody. This slide represents a general overview of the Gold Bar Mine area. Gold Bar is located in central Nevada along the Battle Mountain-Eureka Trend and is a Carlin-style disseminated class of gold deposits. The Carlin Trend is located to the northeast of Gold Bar. Current mining activities are focused on the Gold Bar South to the southeast on this figure and at Pick in the central portion. Most of the known deposits at Gold Bar are aligned in a west-northwest orientation between the Roberts Creek Fault on the east and the Wall Fault to the west. In subsequent slides, I will explain this in a little bit more detail. In 2023, we are addressing three exploration areas that I will speak of, starting with the Cabin South exploration target. Next slide, please.
At Cabin South, we began with drill testing the favorable Bartine unit, shown in the dark blue, in the footwall of the Cabin Fault or to the right of the Cabin Fault. Logging of the drill holes identified only minor alterations, but importantly, the geology was unexpected. This led to a revised geologic model of folding and thrusting. This new geologic model is very similar to the Northern Carlin Trend and at the Cortez deposits, 20 mi to the north. Utilizing the new geologic model, drilling was redirected to the east to target the eastern limb of the fold. Recent drilling has encountered thick intervals of strong alteration on the eastern limb of the fold in several drill holes, with assays pending. Next slide, please. As mentioned earlier, known mineralization is oriented along the west-northwest direction, as shown by the red shaded shapes.
Mineralization is located on the north flank of an old fold, depicted in the blue dashed lines, similar to what we see at Cabin South in the previous slide. In 2022, mapping identified a second set of folds oriented more northerly, which are shown in the red dashed lines. These folds intersect and appear to refold the older fold sets. The intersection of the two folds provides excellent traps for mineralizing fluids, analogous to other Carlin districts in Nevada, such as the Genesis deposit on the Carlin Trend and the Goldrush deposit at Cortez. Additionally, this area is proximal to the wall fault, which is believed to be a possible feeder to mineralization. To date, no drilling has tested the favorable Bartine Member unit at depth between the Ridge Fault and the wall fault. Next slide, please.
The wall fault corridor is one of the most significant faults on the Gold Bar property, extending for over 5 mi in length across the property, with an estimated 1,500 ft of offset down to the west. Mapping the sampling of the fault has shown strong silicification with very elevated geochemistry, including arsenic, antimony, mercury, and locally, gold. While the fault corridor has been recognized as a possible feeder zone, only five legacy drill holes have actually penetrated the fault. All five of these holes did intersect mineralization on the fault. In 2023, we will be conducting wide-space scout drilling, coupled with downhole geochemistry, to identify potentially favorable areas both in and around the fault. Thank you. I will now turn it over to Stefan.
Thanks, Kevin. I'll now review the operational and exploration performance of our 49% owned San José Mine in southern Argentina, operated by Hochschild Mining. As you can see on your screen, 10 members of the McEwen team visited San José in April to review the plans for 2023 and beyond. Next slide. San José is a high-grade, narrow vein, underground mine, which has been in continuous operation for 16 years. You may have read the headlines that our nearest neighbor, Newmont Cerro Negro Mine, announced a major capital investment in the range of $350 million-$450 million, according to Newmont's Q1 report, to extend the life of the mine beyond 2030.
Cerro Negro is already the largest producer in Santa Cruz province, projected to produce 330,000 oz of gold this year. Our large land package surrounds it. Next slide. Last year, San José produced 5.3 million oz of silver and 79,000 ounces of gold on a 100% basis. Our attributable share is 49%, as shown on the slide. Cash costs and all-in sustaining costs were $1,300 and $1,700 per gold equivalent oz, respectively. In the first half of 2023, production is expected to be 10% lower than the comparable period in 2022. Costs have been elevated. San José normally has lower production in the beginning of the year because of holidays and a planned annual shutdown for maintenance.
This year, production was hindered by a grade variability around the margins of the mine veins. The mine management reacted, making adjustments to the plan for 2023 to maintain our production guidance for the year. In Q2, production has so far rebounded over the prior quarter to normal levels. Emphasis will remain on completing additional underground development and drilling to access better mining areas for the remainder of this year and next. Next slide. On the exploration front, drilling is underway on veins discovered in the northern sector of the mine area. Two veins are returning good results. The first, called Mora Northwest, is located approximately 700 meters north of mine infrastructure. It had an initial resource defined in 2022, with additional potential along strike.
The second vein, called Mora Southwest, located only 250 meters from the mine infrastructure, is returning encouraging drill results, and the geological team believes this vein has good potential for resource growth. In the second half of this year, drilling is planned at the Telken Norte Target, which is an exciting opportunity adjacent to the Cerro Negro mine, targeting extensions of the northwest-trending veins that exist on Newmont's property. As an extra benefit, McEwen Mining holds a 2% NSR on Telken if a discovery is made. I'll now turn the call over to Michael Meding to discuss our McEwen Copper subsidiary and the Los Azules project.
Thank you, Stefan. Good day, everybody. Before telling you about the progress that we made with McEwen Copper, specifically the Los Azules project, I would like to talk about this picture. In this image, we have Gisella. She's from Calingasta in San Juan, where our project is located at 3,600 meters above sea level. Gisella joined Foraco, one of our drilling contractors, as a future driller. She's a single mother supporting her two children, an 11-year-old daughter and an eight-year-old son, who live in Calingasta. This example highlights our collaboration with our partner, Foraco, in meeting the social needs in Argentina. There's a large untapped human capital in mining. Current female workforce in mining is 10% on the national level. In contrast, we employ more than 20% of highly qualified women.
20% of our geologists are women, and we have 20% of women in leadership positions. Foraco is joining us in this effort. They supported the incorporation of four women into drilling, three as driller trainees and one as a mechanic. The mining sector, together with oil and gas, pays the highest salaries in Argentina, providing a huge opportunity for progress and development in provinces that traditionally had limited growth opportunities. I'm now going to talk about McEwen Copper and the progress we have made with Los Azules. Our flagship asset is the advanced Los Azules project in San Juan, Argentina, which was ranked as the ninth largest undeveloped copper project by Mining Intelligence in 2022. Our second asset is the early-stage Elder Creek project in Nevada, United States.
With a commitment to innovation and sustainability, we seek to contribute to shaping the future of the mining industry.... What were the highlights of 2022 and the progress achieved so far in 2023? Having completed financing totaling $267 million. Despite a challenging market, we created significant value accretion for McEwen Mining and McEwen Copper shareholders, we are well-financed through 2023 and into 2024. From 2022 to 2023, we have executed two comprehensive drilling campaigns totaling 53,427 meters, representing about 49% of the drilling ever done at Los Azules. We tasked Knight Piésold to develop our environmental impact assessment report. Based on our more than 10 years data, filing in April this year for the environmental permit for the future construction and operation of Los Azules.
We updated our mineral resource estimate, which increased by 27.6% in contained copper. We recently filed an updated PEA with strong economics, long life, significant upside potential, with a very much reduced environmental footprint compared to our prior one from 2017. Rob and Perry had already mentioned our financing. I would like to add that beyond obtaining $82 million via an oversubscribed first financing round, we have gained Rio Tinto as a strategic partner through the Nuton venture. Nuton and Rio are strategic opportunities for our future development. While we have built a robust PEA with existing bioleaching technology, Rio, through its Nuton venture, could represent a significant upside for our project, leaching the primary ores after our initial leaching phase of enriched mineralization, and potentially adding decades of low-cost future production.
Through its [chemical] exploration company, Rio also optioned a 60% stake of the LFC project, located in the well-known Battle Mountain-Eureka-Cortez trend and close to significant operating mines, by investing $18 million over seven years. In our second financing round, we had another strategic partner, Stellantis, which is the fourth largest automotive manufacturer. Importantly, Stellantis manufactures in Argentina, has about 4,000 direct employees, including the local supplier base. About 25,000 families depend on Stellantis in Argentina for their income. Stellantis that has plants in Buenos Aires and Córdoba, and in the future will use copper generated by our project in San Juan, in production in those urban centers, areas that historically are less mining friendly. Beyond the significant investment, this is an absolute strategic fit.
A car manufacturer with a vision for electromobility, a future client for our production, and well-known with great public affairs in Argentina, sharing a vision of delivering better mobility options for the world through green copper and being net zero by 2038 at the latest. In that round, Stellantis invested about $155 million. Rio Tinto also invested $30 million at a significantly improved price, whereas the first financing round only a couple of months earlier, testament to our project advance and opportunity. Our drilling campaign, 2021, 2022, completed 54 holes and 13,500 meters with 11 active drills. We scaled up to 15 drills in the 2022, 2023 campaign, and drilled 138 holes with a record of 39,927 meters.
Both those campaigns represent 49% of all drilling ever done, a demonstration of our commitment to accelerate project development. We drilled several exploration holes and have published so far one hole with 0.29% of copper over 1,052 meters, including an interval of 0.42% and 480 meters at the northern edge of the pit outline. Demonstrating openness to the north and depth and further exploration potential, which we are following up in the 2023, 2024 campaign, to expand on this already vast resource base. Let's talk about our mineral resource estimate and the improvements we have seen so far. Since the 2017 PEA, an additional 51 holes for 21,770 meters of drilling have been added.
This, coupled with an increase in copper price used for the resource estimation from $2.75 - $4 per lb, resulted in increase of contained copper by 7.3% in the indicated and 38.3% in the inferred category. We talk about the PEA highlights. We did more than 200 mine plans with different production rates. We have developed two cases with equal detail. One, our base case for production of 175,000 tons of LME grade copper per year, and one smaller version showing scalability with 125,000 tons per year, LME grade copper cathode production. Our base case has a LOM, or a life of mine, of 27 years.
A strip ratio of 1.16, total copper cathode production of 3.9 million tons, a relatively low initial capital cost of $2.5 billion, with sustaining capital cost of $2.2 billion, resulting in a project with a projected C1 cost over the life of mine of $1.07 per lb of copper. An all-in sustaining cost of $1.65 per lb of copper, and an internal rate of return of 21.2%, with an NPV of $2.7 billion and a payback of 3.2 years. A very robust scenario with further upside potential as laid out in our filed PEA.
Using the S&P Mining Property dataset from 2021 of producing and selected development assets, our base case, as well as the alternative case, rank in the lowest cost quarter, as you can see here in this presentation. Comparing our CO2 footprints, we would also rank in the lowest quarter based on our projected carbon output with further optimization potential. As a summary of the last two slides, a very interesting cost profile with a very responsible greenhouse gas emission footprint, with which we believe we can command a premium in the future. What's the path going forward? We aim to finish our feasibility study by the end of 2024, beginning of 2025.
In order for this to happen, we need to complete infill drilling, with the aim to have the majority of our initial five years of production upgraded to measures, and upgrade a significant amount of the resource we currently classified as inferred to indicated. We need to complete metallurgical testing, both for our base case as well as continuing testing together with new depth technology. We need to execute geotechnical, hydrogeological, and engineering studies to feasibility level, including incorporating further sustainability elements to achieve net zero by 2038. We need also to complete basic engineering design, updating our leach pads, processing plants, and infrastructure to feasibility level. Our upcoming drilling program is slated to be 45,000 meters in this upcoming campaign. Argentina is an interesting place to do business in. I have significant experience in Argentina.
I arrived there in 2009 and have seen several ups and downs, and have been at the helm in finance of a tier one gold operation for seven years in the same province. What I've learned is that it is absolutely vital to have a strong, experienced management team with significant local knowledge to be able to successfully manage projects and country risks. This is why we build a strong local team with the appropriate skills and experience to drive our project developments. This concludes my presentation of McEwen Copper and the advances and opportunities of the Los Azules project, and I now hand back over to Rob. Thank you.
Thank you, Mike. I'd like to conclude by sharing with you what we believe is the underlying value of McEwen Mining shares. The value ranges from $8-$35 per share and represents the sum of our parts. As you can see, we have provided a value range of high and low values. Let me give you some of the numbers. McEwen Mining, fully diluted, has 51 million shares outstanding, and it owns 52% of McEwen Copper. McEwen Copper, in turn, owns two properties, the Los Azules property and Elder Creek. There are two market reference points for the property, the copper projects in Argentina. Just valuing Los Azules, there's...
The two reference points are the Josemaría deposit that sold in April of last year for $485 million, and Filo Mining's Filo del Sol project, which has a market cap today of $2.5 billion. To get to the values we have on the screen, we first discounted these market values by 50%. We multiplied it by our 52% ownership, from McEwen Copper's 52% ownership, and we divided that by the fully diluted number of shares McEwen Mining has out, of 51 million, and arrived at the range of $2.47-$25.14 per share. We moved from Los Azules to Elder Creek, which Rio Tinto has optioned for $18 million to earn a 60% interest.
That would give a total value to the property of $30 million. Again, we multiplied that by our 52% interest, and it's divided by the 51 million shares, fully diluted, to get a $0.31 share value. We have a royalty portfolio consisting of five properties, 1.25% on both Los Azules and Elder Creek, another 2% in Nevada, and 2% NSR on the large San José property portion that was ours before we entered the joint venture. That we valued at $0.69 or a gross value of $30 million. Then we looked at our gold and silver assets, Fox Mine, the Gold Bar Mine, our El Gallo and Fenix Mine, and our joint venture in San José Mine.
We saw that we're trading at a large discount to our peer group, and we compared it to the economic value per gold equivalent ounce, and took that average and cut it in half. That came up with a value of $4.66. In the high end, we went and said, "Well, if we traded up to the peer group," and in the past, we've traded higher than this peer group, "we would be at 930 shares." You get the sums of just over $8 and just over $35 a share. That's where we think we're heading, to the higher number. At this point, I'd like to open the session for questions. Thank you all for attending.
If any shareholder would like to ask a question, please click on the Q&A button and type in your question.
They gone to sleep? No questions? We'd like to thank everyone for attending today. Look forward to reporting to drill results and further developments at our operations, precious metal operations and Los Azules. Thank you very much.
Ladies and gentlemen, this concludes the 2023 annual meeting of shareholders of McEwen Mining. Thank you for your attention. You may now disconnect.