NioCorp Developments Ltd. (NB) Earnings Call Transcript

Good day, and welcome to today's webcast with NioCorp Developments. This is [ Barrett Boone ] with Red Chip Companies. Today's webcast will cover NioCorp's recently published 2026 technical report for its Elk Creek Critical Minerals project in Nebraska. I will now hand the webcast over to Jim Sims, NioCorp's Chief Communications Officer. Jim, please go ahead.

Thank you, [ Barrett ], and thanks to everyone for joining us today. It's a big day for the company. The team today, we're going to walk through a supplemental presentation during today's webcast to accompany our overall discussion in the Q&A session. NioCorp's news releases, presentations, SEC filings, including the technical report supporting the updated feasibility study are all available now on our website at niocorp.com and on SEDAR. On the webcast today, we have Mark Smith, Executive Chairman, President and CEO of NioCorp; and Scott Honan, Chief Operating Officer of NioCorp and President of Elk Creek Resources Company. Before we begin today, please note that today's discussion will include forward-looking statements, including those regarding NioCorp's future financial and operating results, expectations, plans and prospects, any statement that is not a historical fact should be considered a forward-looking statement. Forward-looking statements involve known and unknown risks and uncertainties that can cause actual results to differ materially from those expressed or a description of these risks. Please refer to the cautionary notes in today's presentation and to the risk factors in NioCorp's filings with the U.S. Securities and Exchange Commission and on SEDAR+. Today's discussion may also reference market and industry data drawn from third-party sources, which the company has not independently verified and which are subject to uncertainty. Lastly, all dollar figures today are in U.S. dollars unless otherwise stated. Following today's prepared remarks, we will open the webcast to your questions. Let me now turn the webcast over to Mark Smith. Mark, please go ahead.

Thank you, Jim. And much like Jim just alluded to is a very, very important time in the company's history. This is quite the effort that the company has undertaken here. And along those lines, I'd like to start out by thanking Scott Honan, our COO, the entire NioCorp team, including our Board of Directors, who have all been just phenomenally part in this effort. I want to thank the literally hundreds of consultants that we have used to put this entire independent study together and in particular, the 15 qualified professionals who have signed their name and certified the technical competency and accuracy of this report, very important and it's just a huge responsibility that those QPs undertake when they do that. And then certainly, last but not least, I want to thank our shareholders for their patience as we worked our way through this process. As Jim noted, we did file this report on SEDAR yesterday. If the report is not on our website yet, it will be up there today. And I encourage you to take a look at that 500-plus page document. One of the things that's very important to me personally in every one of these efforts I've ever undertaken is it -- and my entire NioCorp team could attest to the fact that I'm always pushing to get things done, let's get things done, let's get things done. But when it comes to a feasibility study, a technical report like this, quality needs to be paramount. And we will always choose quality over speed when it comes to doing a feasibility study. And so again, thank you all for your patience while we undertook this effort. It did take a little more time than what any of us had anticipated. But I know after all of the years I've been working in project financing and fundraising that, that short amount of extra time in this case, is going to pay very good dividends for us as we move into full project financing, including EXIM and additional equity fundraising. So thank you for that. I think it will pay dividends now with this high-quality study. We basically undertook the feasibility study update for two reasons to start with, and that was to do some additional drilling out on site. We wanted to have tighter hole spacing so that we had better definition of what the ore body contained in between all the other drill hole samples that we had. We undertook that effort and the results were outstanding. Once again, every time we put a drill bit in the ground, we find out something even better about this ore body, and that just continues to be the case. This is an outstanding ore body. Second, we had a new process flow diagram for our metallurgy and we needed to have the process flow diagram, converted into an actual feasibility study level engineering design. So after 12 years now of working on this metallurgy and really optimizing it, I think, to almost the high -- highest extent possible, where we're getting high 80s, low 90% recoveries of all of the elements that we're going to be pulling out of this ore body and selling, we're now in good shape because not only do we have demonstrated metallurgical process, we now have the engineering design to support that effort as well. And then just because, again, quality is paramount. We undertook during the feasibility study engineering effort and the drilling effort, we undertook some other additional studies just to make our technical program that much more robust. So we did some extra geotechnical studies, some geohydrologic studies. We did a lot of work on paste tailings and a lot of work on grouting, which will make for a better mine plan safer volume for our employees and a longer-lasting mine over the long run. So again, really, really a solid effort here, and I want to make sure we send out that thank you to everybody. So Alex, let's go to Slide 4. We'll start out with kind of one of the main drivers here in terms of improvements to the feasibility study for 2026 versus 2022. We will now have 8 different products that we'll be selling as a result of underground mining and surface processing activities. You can see we'll be producing niobium, scandium and titanium, which, of course, was in the 2022 feasibility study, but we'll also now be producing the neodymium praseodymium high purity oxide, dysprosium high purity oxide, terbium high purity oxide. And then as a result of how one goes about processing, rare earth of what comes out first and solvent extraction. We'll also be producing two different concentrate products. One is called an SEG or samarium, europium, gadolinium carbonate concentrate and the other one is all the other heavy rare earth elements in a carbonate form, again, concentrate style. What you can see on the right here, is the life of mine gross revenue. The circle on the left shows the 2022 feasibility study where we had niobium, scandium and titanium as part of the overall revenue, just a little under $22 billion for that life of mine gross revenue. And then the figure to the right, which, by the way, is to scale so that you could actually visually see what the additional revenue means in terms of to scale picture here, we'll have life of mine gross revenue as a result of 2026 feasibility study of a little over $37 billion, with multiple products here, niobium, scandium the rare earth and the titanium. And that $37.4 billion is about 1.7x greater than the $21.9 billion. So a huge impact on the revenue side of the equation given the additional products that we'll be able to produce from this ore body. Next slide, Alex. If we start heading into the overall economic highlights and some of the numbers associated with our economic model. I'll start out over on the left here. And this is a life of mine margin of $560 per ton. That is one of the highest that I've certainly seen in my career in the mining industry. We get that by simply taking the $815 gross revenue per ton figure and subtracting the $255 OpEx per ton. And keep in mind that, that $560 per ton margin is 41% greater than the margin we showed in the 2022 feasibility study. So again, really getting those extra products and getting the extra revenue in really bolsters the economics here. quite significantly. Then we can focus on some of the numbers to the right. I know I like to focus on the $4.1 billion pretax NPV utilizing at an 8% discount rate. We've got $519 million per year, average annual cash flow over the life of the mine. If we head over to the right, you could see the $608 million EBITDA over the -- annually over the life of the mine. We've got a 40-year mine life and we've got a total upfront CapEx estimated at $1.85 billion. So clearly, the CapEx number has gone up as has the NPV has margin as has the revenue as has the EBITDA as has the cash flow. But that CapEx number, I think we were all concerned about what inflation would do, and this is largely driven by inflation more than anything else. But we do need to remember that we've added some additional processing to what we had before as well. We've got to solve an extraction for the rare earth. We have the coronation for the niobium and the titanium. And again, forget about that horrible thing called inflation. But a $1.85 billion CapEx number and we still end up with a less than 3-year after-tax payback with these numbers as a whole. So very, very strong economics, very robust economics, I would say. Next slide. So one of the things that is really starting to catch people's attention in the market right now is an absolute bifurcation pricing between things that are coming out of China and things that are not being produced outside of China. And this is quite compelling number, and it appears to have very good traction and we think it's going to last for quite some period of time. If we take a look at scandium as an example. Scandium being sold -- being produced and sold within China is actually upwards of $800 to $850 per kilogram right now. NioCorp is actually out purchasing scandium on the open market today because we are demonstrating the ability to produce scandium metal and we, of course, own a business that can make the master alloy scandium aluminum master alloy, and we're actually out on the market purchasing scandium to feed those businesses. We're seeing prices for scandium range anywhere from $3,000 to as high as $65,000 per kilogram right now. And it's a very good example of this bifurcation of what is being made and sold in China versus what is being made and sold outside of China. Terbium is another very good example. Terbium inside China goes for about $1,000 a kilogram. Outside of China, it goes for about $4,500 to $5,000 per kilogram and dysprosium goes for about $250 a kilogram inside China, and it goes from about $1,250, $1,500 outside of China. So there's an absolute bifurcation, very clear and evident. And we do, as I mentioned, feel like this bifurcation could last for quite a while because it takes a while to get these projects that everybody is supporting. It takes a while to get these projects built up and operating. We think that, in combination with the Section 232 duties, which are available to the President right now, tariffs, which were available to the President right now. Project Vault as well as the G7 support pricing discussions that are occurring and gaining a lot of traction are all going to help support this bifurcated pricing structure that we're seeing between China and the rest of the world. Next slide. So what do we have going forward here now that we've got the feasibility study done. feasibility study was a huge piece of what EXIM was looking for as part of the loan program that we're undertaking with them. We met with EXIM for about 2 hours yesterday going over as much of the feasibility study that you can in a 2-hour period. They will be looking at that document now for the next week or 2, and we'll set up another probably all-day workshop with EXIM and all of their consultants to go over the feasibility study in detail and answer any questions that they have. But a huge, huge step forward in the right direction here. As everyone knows, we continue to work on our offtake agreement with Traxys. That is all continuing to move forward, albeit a lot slower than what I think anybody anticipated, especially, but I had a couple of very good phone calls with Traxys just this last weekend, and we hope to have that agreement finalized. There's just points that are still in discussion between the two companies. And I don't see any reason why those can't be cleared up and finalized in short order here. The next item, though, is quite an undertaking. And this is where we have to continue with our engineering effort. We have to go from feasibility study to detailed engineering. We have to put the company in our EPC contractor in a position that we can actually write an EPC contract and have something that both parties are willing to sign and something that is willing to agree to as part of their loan undertaking for this project. So this is -- this will be quite an effort. We're already -- we have draft contracts that are already written. We're sharing those with the EPC contractors. We hope to have a lot of that effort behind us by the end of August or so. And then we plan to sit down with EXIM, the EPC contractor as well as NioCorp with the -- with EXIM and make sure that EXIM is as comfortable as we are with those agreements. So you can see we're on a very fast track moving forward now that, that feasibility study is there, and we can use that information to support a lot of the efforts, including offtake agreements and EPC agreements. And then finally, the EXIM bank loan and any remaining equity that's required. Let's talk about that for a minute. We all are aware of the fact that we have written documents from EXIM saying that they would loan up to about $800 million, and they specifically said 65% debt-to-equity ratio in that correspondent. So we are with the new feasibility study, the new economics associated with that study and the new CapEx estimate, EXIM will be making another evaluation to determine what level of debt to equity, they are willing to support for this project. And I don't have any reason to believe that, that amount of loan figure will not increase accordingly. Again, final evaluations have been made by EXIM but the robust economics here clearly will support greater than $800 million in loans from EXIM. So we're anxious for that process to get going. Again, we met with EXIM for about 2 hours yesterday. Talk to them about their next steps and timing for those next steps. They are very energized about all of this. They're as excited as all of us are about this feasibility study being done because now they could really start to move on several fronts, and we're going to have more meetings with them in the next couple of weeks. And the comment that was made by the highest ranking EXIM employee there at the meeting yesterday was that NioCorp remains the highest priority for EXIM right now in terms of critical strategic mineral projects. So we have their attention. They have the data that they need. We'll go through this additional due diligence process with them, and they will make a final determination in short order on how much that loan can be and what percent debt to equity that we'll end up with at the end of the day, once those decisions are made, then we'll know what additional fundraising, if any, we need to do on the equity side. So that's kind of a short description as to where we are now that the feasibility study is done. And with that, I'll hand it over to Scott to get into some of the more technical parts of the feasibility study, changes and whatnot. Scott, the floor is yours.

Thank you, Mark. And I'd like to start just by echoing something that you said at the top of the webinar. I'd just like to thank our NioCorp Nebraska team, the local community around Elk Creek and Tucomsa, Nebraska, the good folks at Kruger Farms and the 15 QPs that certify our feasibility study report. I'm really grateful to have a strong team like this that has worked so hard to make today possible. When we look at our project as it stands today, we have definitely built on the 9 previous technical reports we've done on the Elk Creek project and all of the engineering and testing and mine design that have gone along with that. But we've continued through this line process to derisk the project, both from a technical perspective as well as from an economic perspective. And I wanted to highlight a few areas where we've made some changes to the better for the project. The first area is just in terms of mine access. In our previous study, we had presumed that we would access the mine with a twin shaft arrangement. We've now replaced that with a twin ramp from surface. The twin shaft idea was certainly technically viable, economically reasonable approach. It did require us to use a freezing approach to freeze the ground so that we could sink the shafts through the ground safely. However, putting in shafts is an exacting science, vertical shaft in a mine has to be perfectly vertical. There can't be any deviation and shaft access does require some specialized equipment, both in the shaft and on surface that's only made by a few manufacturers around the world. So we're now moving from that to a ramp access surface. We started that work here in February, establishing the mine portal where our twin ramps will originate from -- and putting in the ramps is definitely an improvement in that the ramps can tolerate some up and down and back and forth as you advance and they are a quicker way to get to the ore body than the shaft approach. Kind of building on that in terms of project schedule, I'd like to thank the folks at Amplify mine planning and Dumas, who put together the new mine design and mine plan. And again, just building on the access question, we now have a design that gets us down to the ore body and into full production in 35 months. That's definitely an improvement over our previous study. And I think we've always recognized that in looking at this project, that the critical scheduling path runs through the mine, you have to get that line established up and running to get the entire project producing and making products. So it's been really gratifying to see that taking this approach gets us there faster. And we get there faster, we start generating revenue and getting a return for our shareholders. Inside the mine, we've changed our approach to material movement. So previously, everything would have been moved around underground using diesel equipment and then wasted to surface through the vertical shafts and the thing called the [ skip ]. Here, with the ramp approach, we've also changed our designer philosophy around material movement, and we've embraced the idea of the railveyor for moving material from the mine to the surface plant. The railveyor is -- it's a very nice piece of technology, I had the opportunity to visit a railveyor installation down in Missouri and I was struck by how simple it is both mechanically and operationally, how easy it is to operate and maintain. And one of the questions I ask myself when evaluating a new technology is, if this thing breaks, kind of go to Elk Creek welding and have it prepared. And the answer with the railveyor is certainly yes. So I think we have here certainly a lower cost, more efficient way to move material out of the mine that will serve us well as we put the mine into production. Sure. Energy supply has been a difficult proposition, particularly in Nebraska, like a lot of places, we've seen a situation where a lot of big data centers have gone in, power supplies are stretched a bit. And the situation with the local utilities is a little bit tougher than it was a few years back. And we are in a situation where getting connected to the local power grid was going to be an expensive proposition both in terms of the capital cost to bring in a power line as well as the capital cost to put in a large substation at the site. We really did evaluate a number of options here and I think where we have landed now is that our best proposition is an on-site microgrid. So what that means is we'll have a series of small natural gas-fired generators that will power the site, both during the construction period and during operations. And a third-party company will own, operate, install and maintain this equipment. We just get power through the fence to power our activities. And the third party can do this at a cost that's really right at the same benchmark as we would get from the utility. So we have a good solution there. We will certainly still need a natural gas connection from a local pipeline to the site that's underway. But that part of it has been certainly a design change, but I think certainly one for the better And when I say that, I'm very focused on the reliability of our power supply. Certainly, when you have people in an underground mine, you need to have power and it has to be there all the time. Now I was fortunate enough to visit a very similar type of microgrid system that powers the Pittsburgh Airport and has been doing so for 5 years. And really, I felt that if you can have one of these systems to power a big airport like that, we can certainly use it to our advantage at the Elk Creek project. The other big change is on the processing side. So certainly, we've added equipment to the production process to produce rare earth products, but we've also changed our approach to the front end of processing the ore. In the prior project design, we had a couple of upfront steps. The first was leaching with hydrochloric acid. The second was leaching with sulfuric acid. And the asset demand in that approach was quite high. It required us to have an on-site acid plant, which again was both technically and economically feasible, although acid plants are very particular technology and you come with some considerable maintenance considerations. Stepping back, we had -- we ran a demonstration plant and evaluated different plays to get it to pay metal and ore and what we came up with is a much better front end of the project. So what we have now as a calcining step and a step to remove calcium and magnesium, this reduces the mass of the ore that the rest of the plant sees by about half, and it takes out all of the acid consumers in the ore or at least most of them. After those first 2 steps, we then return to the idea of hydrochloric acid and sulfuric acid leaching to get at our pay metals. But we can do that at a much lower acid consumption than we had previously. And as a result, we no longer need an acid plant on site. We will recycle our hydrochloric acid and simply neutralize sulfuric acid. So it's definitely a change to the better on the process side of things, reducing our acid consumption and simplifying our production process. Now finally, as I mentioned, we've added or expanded our product suite to include the rare earth products that Mark mentioned at the top of the webinar. We're really leveraging our expertise around rare earth as a company. And we're taking advantage of all the good work that we did at our demonstration plant where we built a small scale version of our production process. We ran it continuously and we're able to take all of the data generated from that plant and incorporated into the current design. What distinguishes us on the rare earth side of things as separate from a lot of other development stage companies is that we are actually going to produce fully separated high-purity rare earth products that can go directly into the supply chain for making rare earth permanent magnets. And in addition to that, because we have all the rare earths present in a ore body like anywhere with ore body, we have the upside ability to take samarium, europium, gadolinium, perhaps yttrium and separate those out and make those products as well that could be a future capital project at the site again, to deliver some more revenue and value to our shareholders. At the end of the day, folks, we have a better project here. It's a better revenue distribution across a broader product portfolio. And we have a project that's not reliant on a single element or product to sustain our economics. We've made improvements to the mine and the surface plant, and those have resulted in higher efficiencies in the operation and higher yields to the product. And then we also have a shorter time to commercial production. Next slide. One thing I like to talk about is what's happened to our resource and reserve as a result of all the good work that we did last year at the site with an extensive drilling program. So now we have 45.9 million tons of proven and probable reserves, 40-year operational life. And in the process of doing the drilling last year, we have established a proven reserve, which is the highest category of reserve that you can have on a mining project. This is a very important step for us and it was important because not only does it increase confidence in that underground mineral reserve, but it's something that the EXIM Bank was looking for us to do. I think it's important for folks to understand that the drilling we did last year what's known as an infill drilling program. So we certainly knew where the ore body was and we had a certain level of confidence in it. Really, that program was intended to put holes in between holes that we already knew a lot about. When you tighten up whole spacing that way, you increase your confidence and you get to these higher level of resource and reserve categories. A nice side benefit of the drilling that we did is we did get a substantial increase in our inferred resources category. That wasn't part of the initial plan, but it's always good when it happens. And it just points to the fact that we have a tremendous ore body at Elk Creek that remains open in a number of directions and certainly has the potential to become bigger with more technical work. In terms of the resource now, we have 21.7 million tons of measured resources, 187.4 million tons of indicated and 169.2 million tons of inferred. And I think what you can read into those numbers is we've talked about a 40-year mine life. But again, with some additional work, we could certainly convert more of those resources into reserves and certainly extend the mine life beyond the 40 years that we're talking about here. Our product portfolio remains the same, and I'll just highlight to everyone that we're now reporting everything in Imperial units. We did that because at the end of the day, we're building a project in the United States and the people on the -- that are going to be using the tools are going to be used to doing everything in Imperial. So we've made that unit conversion to make it easier for the eventual construction of the project. We'll make a little over 8,000 tonnes a year of ferroniobium. That's our backbone product. That's what our entire production process is built and based around. We'll make 118 tonnes a year of scandium and just a lot of exciting things happening in the scandium world these days. I'm sure everyone has seen our recent announcement with Lockheed. We now have NioCorp [ advanced ] metals and alloys with the capability of producing scandium aluminum master alloy. And we've got some great things happening over in the U.K. with Project PIVOT, looking at incorporating scandium into aluminum that's used in automotive platforms. We have our three magnetic rare earth products that certainly are in high demand here in the United States right now. We're making a samarium, europium, gadolinium carbonate or SEG carbonate. That will have a market for it certainly. But that again goes back to what I said about some upside here and that with some additional capital and testing work, we could separate those rare earth products into individual oxides as well and get some more economic benefit from our ore body. We'll make a heavy rare earth carbonate, which is all of the rare earth elements heavier than holmium on the periodic table, including yttrium. Interesting things happening in the yttrium market these days, again, an element that certainly the federal government here in the U.S. has some interest in. And again, something we could do in the future as an expansion or improvement project to target that element and recover it as a separated product. And rounding out our product portfolio is just a little over 59,000 tons a year of titanium tetrachloride and higher-value version of the titanium product that we made previously and a feedstock that you used to make titanium pigments and titanium metal. Bottom line here is we have a strong project with a long life and the potential for an even longer life with more technical work, lots of upside here and certainly, I can't wait to get on the ground and see how big it really is. With that, I'll turn it back over to Barry.

[Operator Instructions] Our first question comes from Neal Dingmann of William Blair.

Mark, could you talk a little bit about -- you mentioned the timing, again, I think -- and Jim and I talked about this a little bit. Key data now is the timing between now and the -- now in the financing, of course, again, is it just the EXIM, seems like now having the definitive feasibility study, you'd have most, but is it just now across the [ test ] in the eyes, I mean how much more details will EXIM be looking for between now and then?

It's a good question, Neal. And we continue to learn more in every discussion we have with EXIM. They're no different than a commercial bank in many ways. They kind of have an idea as to what they'd like to see and we talk about that, and we provide it to them and then they have another idea. So we'll continue to go through that process, but we know what the main pieces are that are remaining. We've got to finish the Traxys offtake agreement. We need to get an almost final, if not final EPC contract in front of them, and we're going to be ready to go. So I don't -- I just don't see any reason why we can't get a lot of that work done in the very near future and get this in front of the Board of Directors for EXIM in short order.

Very good. And then love to see and was hoping to see the -- now walk through having the 8 distinct critical minerals that are in there. I guess my question is, as prices -- once that starts -- when [ Tel ] kill starts producing, how flexible, I guess, is the best way to ask it, will you all be? I mean if, again, scandium prices take off or dispose them, you name it, there's going to be a lot of, obviously, upside potential for the mine. How much flexibility will you have to sort of lean into one or the other. So I guess my question maybe for Scott, just on operational flexibility, how he sees it once the -- once Elk Hills is producing commercially.

Yes. I think, Neal, that we have a production process that's built around a mine plan that is intended to deliver a fairly steady head grade to the operating plant. That's not to say, though, that, that can't be optimized. We have some very good and clever mining engineers. And while you're a little bit constrained in underground environment as to how you approach the mining, there's a certain sequence you have to have. We certainly have enough information about the ore body that we could target, say, higher grade zones of niobium if niobium market got really hot. I think the other thing that we've certainly talked about internally is the fact that our production process is pretty versatile as far as what kind of feedstocks it could incorporate and process successfully. So there's probably a number of flavors of rare earth concentrates, for instance, that might be available in the market that we could buy and supplement to the feed coming from our own mine to prospectively increase our production of rare earths that might require some capital investment on the back end of the process to ensure we have adequate separations capability to make additional rare products, but it certainly could be done.

If I could sneak one more in, Mark, just on further -- should we expect those in the coming months, coming quarters?

You broke up a little bit there.

Offtake agreements -- should we expect you guys have done a tremendous job already, obviously, locking some things in. Should we expect more in the coming months, coming quarters?

Yes. Let me discuss that just a little bit, Neal. Kind of at a very high level, we're going to have two commercial agreements for 100% of the offtake for this mine. 50% of our ferroniobium will go into [ Tseroup ]. And then everything else will go to Traxys once that commercial agreement is finalized. Within that Traxys agreement and a lot of this is built around the long-term relationship and trust that we have between Traxys and NioCorp is our ability as NioCorp to continue to go out and market those products on our own. And we may find customers or uses, applications, different strategies that we want to employ because of a growing market or strategic implications for the country that we want to really focus our sales on [ SR ] customers versus others. We will have the right in the Traxys agreement to undertake those sales efforts and then sit down with Traxys and discuss which party would be better overall for NioCorp and its shareholders. And Traxys will be fine one way or the other because they'll get the economics regardless of whether they make the sale or whether we make the sale. So we could really kind of lean in on a lot of different areas that we think may have a better future better margin, maybe working with a customer that's a better credit risk. So lots of things that we can use there to optimize our commercial situation. Other thing that we're doing, and this is based on -- after a while, you how not to do things in the business. And so we try to keep those in top of mind as well. One of the things we're doing with our commercial agreements is we're turning them into volumetric take-or-pay agreements rather than price-based take-or-pay agreements with floor prices. And one of the big reasons behind that is our confidence extreme confidence, I might add in where all of these markets are headed for the products that we're going to be selling. The supply and demand fundamentals are all in our favor. And what I don't want to do is to end up with a commercial arrangement where we may get a floor price, which really helps our debt provider get comfort, but then we also end up having a ceiling price as well. We're going to avoid ceiling prices wherever possible and make sure that the company can take full advantage the confidence that we have and where these markets are going. So we are trying to apply some deeper thinking to how we're conducting our business. And I think we'll end up being very protective very good markets going forward and be able to, like you say, lean in where that possibility opens up.

Our next question will come from Tate Sullivan of Maxim Group.

And can you talk about the plan construction time line. I think in this study, it indicates 35 months back in 2022, it's 45 months, I believe. Is that due to the ramp access? And also, is it a bit of the portal starting construction in February?

Scott, do you want to do that?

Yes, I can certainly take. As I mentioned, we've always recognized the critical path for this project goes through the development of the mine and getting the mine into production. So it's a combination of two things. One is getting that mine portal started and established if we can get that behind us, then the remaining work to get down to the ore body and get the ore body producing goes quicker. I think the other thing here is that when we had put together various mine plans, including the one in the last study, looking at shaft access. The shaft access and the development from the shaft to the ore body, introduce some constraints on our ability to get to the ore body quickly and to ramp up that production. And if you look at our last study, there was a fairly long period of 8 months or so where the mine started producing at an initial rate and then it ramped up fairly slowly to full production. I think the design we have now gets us there just a lot more quicker. So we get down to the ore body quicker. And with the ramp access and the advantages it provides, it allows us to get the stopes that we need into production quicker and get to that full production threshold just as quick as you could hope.