Atalaya Mining Copper, S.A. (ATYM) Earnings Call Transcript & Summary

Good morning, and welcome to the Atalaya Mining plc 2023 AGM proceeding. [Operator Instructions] I'd now like to hand over to Roger Davey, Nonexecutive Chairman. Good morning, sir.

Good morning, ladies and gentlemen, here. Very quickly run through sort of running order of the day at the meeting. Although the Chairman's statement is included in the notice of meeting, I will for good form from people in the meeting, read the chairman's letter first before the formal meeting. We will then have the formal meeting and can I ask you please to restrict an items to the matters on hand at the formal meeting. Following this, we've a presentation by Alberto on the main activities of the company, and that would be a more open question and answers session. So if I can start then, please before the formal meeting with the show with the Chairman letter. The year of 2022 presented a number of external challenges, as always, although they were very different from those experienced in 2020 and '21, where COVID-19 affected everyone. We started 2022 with a positive outlook with the pandemic in rapid decline and economies all over the world picking up speed. This feeling of euphoria quickly subsided with the events in the Ukraine in late February '22, which immediately impacted the European and global energy markets. Severe spikes in natural gas prices in Europe pushed electricity prices in Spain to over EUR 500 per megawatt hour in March '22 and similarly also in late August and early September '22 [indiscernible] with average realized prices in quarter 3, reaching around EUR 290 per megawatt hour. The year was dominated by geopolitical and macroeconomic factors, but for the most part, our operations performed well. The company continued its good track record, with copper production totaling 52,300 tonnes compared to 56,000 tonnes in '21, a slight reduction in production was a result of lower grades and lower throughput. The plant performed solidly throughout the year despite the negative impact of the 2022 transport sector strike and related stoppages last quarter. The average process plant feed grade of 0.4 copper and the process recovery rate of approximately 86% were consistent with reserve estimates and budgeted figures. Cash costs and all-in sustaining costs for 2022 of $3.16 per pound and $3.37 per pound, respectively, were upper end of the guidance for the year. This was mainly due to a guarantee increase in electricity costs and other supplies and lower production volumes, partially offset by the weaker euro. The strong operating performance shown in the latter part of 2022 continued into 2023, with the plant maintaining throughput above nameplate capacity. Accordingly, copper production guidance for 2023 remains as previously announced, in the range of 53,000 to 55,000 tonnes. Despite solid operational performance during 2022, revenues of 2022 were EUR 361.8 million compared to EUR 405.7 million in 2021. Reduction was due to lower production volumes and a lower average realized copper price. EBITDA for 2022 was EUR 55.3 million compared to EUR 199 million in 2021. The EBITDA was significantly affected by the inflationary environmental globally and mainly due to the increase in electricity costs during '22 -- mainly due to the increase in electricity costs during 2022 of around EUR 64 million. At one point, we thought we were working only for the electricity companies. On a much more positive note, as a result of electricity price so far in 2023 and the benefits from two key company-specific electric -- electricity procurement initiatives, we are optimistic on the outlook for overall electricity costs for 2023 and beyond with a relevant knock-on positive effect on the profitability. The long-term power purchase agreement, PPA took effect on the start of 2023. This 10-year agreement to provide the company with approximately 31% of its current electricity requirements at a fixed rate that is over 75% lower than the estimated average realized electricity price in 2022 and also, in fact, below the rates realized in 2021. The company continues to advance as well in the advance of its construction of its 50 megawatts solar plant, Riotinto, which is expected to provide approximately 22% of its current electricity needs, when fully operational in late 2023. Combined, the 50 megawatts solar plant in the long-term PPA will provide over 50% of the company's current electricity requirements as we rate below historical prices in Spain. The company continues to evaluate additional renewable initiatives that could deliver further low cost carbon-free electricity for its operations in Riotinto, including the wind turbines. For additional growth prospects, the company is currently focusing on five main projects. The company remains fully committed to the development of the Touro copper project in Galicia, in the north of Spain. Running parallel with the permitting process, the company is focused on a number of initiatives relating to securing the social license, including engaging with many stakeholders in the region in advance of its plans to submit a new improved project design. In the south, at Proyecto Masa Valverde, exploration work is ongoing with three core rigs by which continuing to be active with encouraging drilling results. Drill target definition continues to progress and the first drill testing is planned at Riotinto East, another area. Two short drilling programs were completed at the Hinchona and Chaparral copper-gold projects at Proyecto Ossa Morena. Finally, in February 2023, the Company announced the completion of a new preliminary economic assessment for Proyecto Riotinto that contemplates a new integrated mine plan for Cerro Colorado, San Dionisio and San Antonio [indiscernible] which has the potential to increase copper production by increasing the blended head grade processed at Riotinto's 15 [ million ] plant. The Company continues to advance construction of the E-LIX Phase 1 plant. In recent weeks, activities have included the completion of most civil and construction and structural work, with equipment now being assembled. Commissioning of the plant is expected in second half 2023. Also operational, the E-LIX plant is expected to produce high purity copper or zinc metals on site, allowing the company to potentially achieve higher metal recoveries from complex polymetallic ores, lower transportation and concentrate treatment charges and a reduced carbon footprint. Our balance sheet remains strong and this allows the Company to continue to invest in growth and cost reduction initiatives, including E-LIX, higher-grade orebodies and exploration across our portfolio. In addition, our financial strength means we are well positioned to develop Touro should approvals be granted, which could become a new source of copper production in Europe. I would like to thank Harry Liu, who stepped down from our board following a long period of service, and also welcome Kate Harcourt to the company's board. Kate has immense expertise in sustainability and we look forward to publishing our second sustainability report for 2022. I would like to take this opportunity to express our appreciation for the continued dedication and commitment of the management and staff. At the same time, I would like to thank not only the Board members for their continued support, guidance, and close involvement with the company activities, but also our valued shareholders for their continued and appreciated support. Thank you. Ladies and gentlemen, I'd now like to move to the formal part. So ladies and gentlemen, welcome to the Annual General Meeting of Atalaya Mining. My name is Roger Davey, Chairman of the company and with the consent of the meeting, I will again be very proud as the Chairman of the meeting. So please let me introduce my fellow directors. We have Alberto Lavandeira, Neil Gregson, Kate Harcourt. Stephen Scott is, I think, on this side, on this side. We have, apologies, Jesus Fernandez and Hussein Barma, who unfortunately could not be present here today. The secretary, the meeting will now come to order and with your consent, I shall ask [ Dominic is going to Champion ] to act as Secretary and scrutineer of the meeting, [ Dominic ]. The following documents have been tabled. It's certainly containing the notice of meeting. The form of proxy and the annual report containing the auditor's consolidated financial statements of year ending 31st of December 2022. These documents are available for any shareholder to examine if you service. The Annual General Meeting of the company was contained by the notice the shareholders dated the 1st of June 2023. May I have taken the notices read. See no objections. I advise there is a quorum present and that notice calling this meeting has been given in accordance with a company's business Articles of Association. I now therefore declare that meeting is properly called and constituted for the transaction of business. I may now turn to the resolutions put before the meeting and propose each resolution each term simply meeting. Resolution #1 provides for the receipt and consideration of the audited and subjective financial statements of the company for the year ended 31st December 2022 and the reports of the directors in order to steering. In respect of Resolution 1, we have proxy votes have been cast as follows; for, 94,845,701, which is effectively 100% against 58,206 and withheld 176. I now proposed Resolution #1 is a ordinary resolution. Those in favor, please? [Voting]

Thank you very much. Those against? [Voting]

Thank you. I declare the Resolution confirmed. With the consent of the meeting, I'd rather not read the detailed numbers of the [ foreign against ] and against because all the proxies are in the range of between 85% and 99%. So if you don't mind, I'll just say -- I'll just declare the proxies as a positive vote. Otherwise we'll be here all day listen to [ 94 million ] [indiscernible] . So the second Resolution #2 provides for the reelection of Mr. Roger Davey as director of the company. In respect to Resolution 2, again 93%, [ for ]. Can I ask the shareholders please to propose a Resolution #2. [Voting]

Thank you. Those in favor? [Voting]

Thank you. Those, against? Otherwise I'll see you outside. [Voting]

Resolution #3 provides for the reelection of Mr. Alberto Lavandeira as a director of the company. Again proxy votes are 100% and I think I'll now propose a Resolution #3 as a ordinary resolution. Those in favor? [Voting]

Thank you very much. Those, against? Resolution #4 provides for the reelection of Mr Jesus Fernandez Lopez as a director of the company. In respect to Resolution 4, and again it's 100% to [ for ]. So I now propose the Resolution #4 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

Thank you very much. Resolution #5 provides the reelection of Dr. Hussein Barma as director of the company. In respect to Resolution 5, again 100% [ for ]. I now propose the Resolution #5 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

I declare the Resolution held. Resolution #6 provides for the reelection between Neil Gregson as a director of the company. In respect to Resolution 6, 100% [ for ]. I now propose the Resolution #6 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

Resolution 7 provides for the re-election of Mr. Stephen Victor Scott as a director of the company. Again, overwhelming for vote. I now propose the Resolution #7 as an ordinary resolution. Those in favor? [Voting]

Thank you. Those against? [Voting]

Thank you. Ladies and gentlemen, the resolution 7 carried. Resolution #8 provides for the reelection of this is Kate Jane Harcourt. In respect to Resolution 8, gave overwhelming for. I now propose the Resolution #8 is an ordinary resolution. So thank you very much. Those in favor? [Voting]

And those against? No? [Voting]

I declare the resolution carried. Resolution #9 provides the re-election of E&Y Cyprus Limited as the new auditor of the company. In respect to Resolution 9 again 100% [ for ]. Resolution #9 as an ordinary resolution. Those in favor? [Voting]

Those against? [Voting]

The resolution carried. Resolution 10 provides for the declaration of a final dividend for the financial year ending 31st of December 2022 of USD 0.0385 per ordinary share of the company. Came over 100% [ for ]. So I now propose Resolution #10 as an ordinary resolution. Thank you. For those who favor? [Voting]

Those against? No? [Voting]

That's true I declare the Resolution 10 carried. Resolution #11. Authorizes the directors to grant assuming to Atalaya Mining plc long-term incentive plan 2020 options to subscribe for up to 6,993,960 ordinary shares of 7.5p each in the capital of the company. All three shares representing approximately 5% of the companies issued share capital at an exercise price in accordance with the terms of the long-term incentive plan. In respect to the Resolution 11, the proxy votes are [ 4 8 2% ]. I now propose the meeting resolution #11 set out in the notice to convene the Annual General Meeting. As at least 50% of the company's issued share capital is represented at the meeting in order for the resolution effective it must be passed by a simple majority of the votes cast on The Resolution. Can I ask those in favor, please? [Voting]

Those against? [Voting]

Thank you very much. I declare the resolution carried. Resolution number 12 authorizes the directors to issue or corporate grant rights to subscribe for up to an aggregate of 13,987,921 shares ordinary shares representing approximately 10% of the current issued share capital of the company as if the rights of pre-exemption in section 60B of the company's law did not apply. Such ordinary shares issued or rights to subscribe for ordinary shares granted as soon as this authority will be at a price of not less than 20% discount to the market price of an orderly share on AIM for the 10 trading days immediately proceeding such issue or grant. In Respect of Resolution 12, again proxy voting votes are having 100% and I now proposed the Resolution #12 set out of an notice convenient language as at least 50% of the company's issued share capital is represented at the meeting. In order for this resolution to be effective it must be passed by a simple majority of the votes cast on the resolution. Those in favor, please? [Voting]

Thank you. Those against? [Voting]

Thank you very much. I declare the resolution carried. Resolution 13 provides for an amendment to the company's Articles of Association by the addition of a new regulation 161 as follows entitled 3 [ diminant ] 161. The company made by a special resolution and upon consent given by the Registrar of companies continue to exist as a legal person subject to the legal regime of a country or a jurisdiction other than the Republic of Cyprus to be operated pursuant to the laws of such country or jurisdiction. In respect to Resolution 13, we have proxy votes of 100% effectively. I now propose Resolution #13 is a special resolution to be effective it must be approved by at least 75% of the votes cast at the meeting. Those in favor, please? [Voting]

Thank you. Those against? [Voting]

Thank you very much. I declare this on resolution 13. The resolution carried. Thank you. Sorry it took so long. That completes in fact the formal business of the Annual General Meeting. And I thank everybody for attending. And Alberto will now make his presentation on the company's activists, where we can have a more a question-and-answer session and after which we'd like to invite more to stay and join us for refreshments. If we have some time? We do. Thank goodness for that and take the opportunity to discuss the business for every few weeks. So thank you very much. I will now hand over to Alberto for presentation.

Thank you very much, Roger. Well, here I'm going to go try not to repeat the figures that the Roger has shown. Let's try to summarize briefly what we have done in '22, how 2023 is going, and what are the -- what's the future for this company. The [ '22 ] was a though year where we use more or less a suspected and slightly less due to a strike in Spain. And it's much higher cash costs, especially due to the high inflation related to energy prices. Even with that we completed the year with a good cash flow position of a net cash position of EUR 53 million and generated the EUR 55 million of EBITDA. From the asset level, we continue to progress. We continue progress the announced what [ my character ] the satellites. From Riotinto where San Dionisio, San Antonio storage depositors were actually mined in the past. It must have a revenue that's something that we have acquired sometime ago. We published the technical reports on those projects and we started exploring around the belts to five new resources, and we also started with the construction of something called E-LIX and a solar plant and I will talk about that. An important thing from the corporate point of view is finally, we got rid of Astor. We concluded all the litigations after having to pay EUR 53 million, which was not a bad outcome because we had to pay after several years and we also paid an interim dividend besides we had paid in '21 and then the Board has approved another small dividend to complete that first deal. A long-standing shareholder exists older stake because they run into trouble in the real estate in China. So the shares were executed by a bank and he resigned as [ being accepted ] as nonexecutive director. He was one of the kind of founders of the company. So this person was certificated by others. We had the main addition to the Board of the stuff. Kate Harcourt, which brings a lot of experience from the sustainability point of view, which is consistent with the establishment of a sustainability committee in our company and the publishing of the first sustainability report in '21 and now recently interested to report. And also related to ESG matters, we commissioned a water treatment plant in Touro, which I will speak about that, which is essential to get the purpose. So that was '22 in a nutshell. So how things are going in '23. We're almost half the year. First quarter, 12,000 pounds of copper with a bit of [ 24 million ], a little bit lower than if you divide the whole guidance of [ 55,000 ] in 4, but we are on track for our guidance. We expect to be substantially higher production and lower costs during the second quarter. So I think you should really respect that will be within the guidance for 2023. Our cash position to continue to be okay despite the fact that we're investing heavily in the solar plant and in the E-LIX. And this situation will continue as we speak here during the year. We had also continued doing lots of activities and as a result of that, we got permits. So ready to start mining in Masa Valverde. So it would be a #1 mine, where we'll truck the ore to the existing plants and we already also got the environmental permits for the expansion of [ Europeans especially that gives us space ] for a additional 10 years of tailings capacity. This is process of almost 3 years. So imagine how important this is. And also we continue in reconstruction of E-LIX and solar. An important point is that we could continue with our plans to move to London as our main list. As a first step of that, we have finally been delisted from Toronto. We didn't have too many shareholders there in order to shareholders. So finally this basically we do this as a cost to saving exercise. To be our target is to be listed at the end of the year the main market in London. From the health and safety point of view, we've been dealing with a good health with good safety results. We could deal with the restoration and water treatment plant at Touro, which is essential for apartments and we continue to evaluate more renewals. So now in a very short how this is the future of the company? You can see the growth of this company from back in [ 2015 ], when we restarted the old absorbent plant for around 4.5 million tonnes per year to basically 15 million tonnes per year during the last 4 years. Quite established production, but the question mark is that were raised by some people about ability of the production could be extended after such a short ramp-up period in such a short capital has been not improved with also as a result of that, we have been reducing between 52,000 and 55,000, 56,000 tonnes of despite copper grade, which means the operations are going quite well. So let's talk about the briefly about the main issue on 2022 and what's changed. In different colors in his you will see in the lower part what was the price of electricity in the Spanish market back in 2020. It was quite low due to the government permission, the crisis, but in any case, we had a fixed price around [ 60 ], which is two lines in the bottom are [ zero ] and 100. So more or less slightly higher than half the way between. The next year in gray, you will see that starting low, but then it started going up in the last part of the year due to its collection of the gas prices. The black line which is in the upper part is there are you can see two big spikes; one in February -- late February; one in [ pions ], which are the invasions -- related to invasion for Ukraine and with a heatwave that happened to be in Spain, coincident with the blowing of the pipes of the Baltic. Those prices of electricity of 300 to 500 were basically 5x higher than we used to have in the past. What did we do about that? We hedged for 10 years in that small spike you can see downward in February, we covered ourselves for 30% of our production at around 54 or 10 years it started in January '23. Taking advantage of the market approach moment to be able to make sure we were covered at less than we used to have -- the best price that we used to have. We also started with a permitting reconstruction of a solar plant. The ordering all the equipment, but besides that, the gas has stabilized due to situation of gas. As you know, Europe is not so dependent of Russia anymore and since January in the kind of brown lines, you have seen -- you can see that the market prices that electricity have been always in general under a country and actually recently around EUR 100 per megawatt hour, that's the price of the market and 30% of that we pay at around EUR 55, which means our price is under EUR 100, which is roughly half what they used to be. So this is essential because last year, we used to pay in previous years EUR 20 million of electricity bill and last year, we paid EUR 88 million. So it was EUR 68 million that went directly to your cash flow pre-tax and of course the electricity also has relation with the line with the live prices with the other consumables and with inflation in general. So I think we are in a good start and we will continue looking at opportunities to hedge a little bit more in the future. But besides that, as I said before, [ my name is not all ] the panels on site. We are starting the construction. There were some delay in permits of the village of Riotinto and some supply issues. Finally it looks like at the end of this year, we'll have another 20% of our needs, basically covered at [ 0 ] price and of course, this is forever. In addition to that, why are we so interested in electricity? We have started something called E-LIX. E-LIX could be named for electricity [ niching ], and it's something that just in case you are not familiar with it. Basically consists of bleaching sink and copper concentrates using electricity as the main consumption. So for us it's very important to have cheap and opportunities. Last year, we decided the construction of a fresh face plant and this is how it looks in the last month. It's going a little bit slower than we have expected. You to be in a novel process and you need to be in constructed by some company for refinance. But finally we have the commissioning of this plant in the later part of this year at the end of the summer. You can see some pictures of outside, inside, you can say for example the position of the [ electrowinning ] cells that are already there. So things are going moving probably slower than I would have liked, but they're moving quite fast in general for such a complex and new project. All the motor control centers are inside basically waiting for cables to be distributed, including transformer equipment to all the programs outside. And as you can see, it's a quite a complex installation that would be ready to be commissioned at the end of the year and why is this important people may ask? Well why are you interested in E-LIX? At the end of the day you only have copper. Well, we do have copper. We do have copper, but in we are only mining copper in the center state that you see in the center of the picture that's called [ rock ]. If we didn't have anything else. We would buy them for around 10 years. A reminder will have been finally already for 8 years. So it's talking about 18 years by the higher phase, when back in 2013, the facility study was shown a point of quality of life. So in the foreground in the background, we have two deposits called San Antonio, San Dionisio, which are historically deposites that are well known. As you can see that have higher copper grade and higher and had good sales. Well, the first thing we said is how can we put this into our you know so we for certain studies established, how we could blend this deposits into with our open pit. How this looks if I made a vertical section along this pitch? It would be looking something like this. At the left side, you will see the you can see Atalaya pit, some red color rates a couple over 1% and orange and yellows over 0.2%. So anything that's yellow it's interesting and red and you can see in the right side a higher grade a flat deposit going under -- going down. You can see several things in the centers, where we bind your federal Colorado and the two sides, you can mine a big part of it will have open text and participate underground and the right side will minus. So this is the reason why E-LIX would be very important. In any case when we commissioned this PEA, we said, look, I want you to put a plant here. How we can mine this in the next 15 years, and we put a plant together, but because we have these [ 7 ] deposits, it will be very interesting to also have some other means of recoveries with very low recoveries for copper and zinc. What I mean copper range of 70s versus our [ 86 ] right now and with zinc also in the range of the 70s, we will get in these results of production from the start-up of after tax interesting values at certain describes [indiscernible] what is the effect of E-LIX? Well we are in '23, and we have we can assume that until '26, we don't need zinc. Zinc is shown in black, shown as copper equivalent, but actually zinc is there. It means before '26, we had to decide that we are going to go with zinc flotation or we are going [ to use values ]. So right now we have this industrial plant being constructed. So we believe that this thing can help. Why it can help? Because the recovery is using this leaching basically it's like trying to separate both crystals of sugar, brown sugar and white sugar by hand versus dissolving that when you use the sovereign, which are basically 100% recovery and [ 95% ] recovery [indiscernible]. In any case, we are -- as you know, we are quite conservative, and we assume this plan even in the [ southwestern ]. With this plan, our production will get us to over 60,000 tonnes of copper in the next 4 years, only copper without having anything or at least minimum [ safe ] and then going to over 100,000 tonnes of copper equivalent, including the copper at the long-term prices copper prices of [ 385 ], which is our current price, flat for the next 15 years. The cash flow undiscounted which is the cash flow you after tax will you use for the pay dividends is [ EUR ] 2.7 billion, which is more than 5x our market cap. Even if we discounted at 8%, it will be [ EUR ] 1.4 billion, which is roughly 3x over market cap. Of course we believe that the copper price in 15 years is going to be much higher than that, and you can see our leverage this project will still be economic even at very low copper prices, but at higher copper prices and we believe the market is going to do over $4. They have the standard cash flows over $3 billion and the discounted cash flow after taxes $1.5, which is more than fact that's our cash flow. So I think we have a very good a very nice future at the redeem to itself and this is assuming that in the next 15 years, we don't discover any reserves or resources from any of the satellites like Masa Valverde, Majadales or any of the places that we are drilling. This is just one of the parts of our growth. The other one is [ Touro ]. I'm really sorry to be saying every day because I'm every year finally we'll get the purpose of total because I'm from the area. What you're seeing in the picture is the old bits that were mined back in '87 the last time and in the open picture is the former, the old plat we are going to be putting up news now, but we don't in 2020 a negative environmental impact declaration. So that's negative declaration was used to I think it was political reasons, but the main thing is look two excuses. One is that we cannot warranty that the tenants are not going to break things on the remote going to break like they did in the Brazilian disaster happened previous year and flood the rivers and second is that there is remnant acid water from the past historic mines that if you see what happened in the past then it's going to happen in the future. Well for the first statement, we said, look, we are going to remove the water from the [ bay leaks ]. So it's not water on top of things. It's impossible and it breaks it makes up. Second thing, we are going to fix the water situation, which is a quite unusual case because normally this was going to be done after we started up. He said, look, Mr. authorities -- actually Mrs. Because it's a lady running the water authority, allow us to fix the water situation, which is our legacy situation, which is not our problem. The same way that we were going to do it as promised in the project. Let us show you that can be done then that's what in the future of one working is going to be worse. It's not true. We did that. We were allowed to take the plants started operating the plant since the beginning of the year working in closed circuit or is the result of this and this is visible is that the rivers that are flowing under the total project in the left slide you can see how was the Lañas River, which takes the water from the whole seepage back in August 2021, the water is not that dirty as it looks, but there was a precipitation. There was a precipitation of iron in stones and what you can see in -- what you can see in the right side, hopefully, you can see it well. It's the [ Pristine ] River. The same picture from the same position with the river totally [ pristine ]. Obviously this is known by the authorities and this gives us a very good feel that now those two species cannot be used anymore and there's a third reason why we believe this thing is this time is different. From the past, we used to have some people saying no to the mine, you they even remember 4 years ago some activists come into one our AGM saying that they didn't want the mine. They were two persons. One was local. Well, few couple of months ago we got 3,000 people saying, yes to the mine, getting together into a market. They are all local and you seldom find these things. Normally humidity will be very vocal say we are against the mine and it's not very common that the TV comes there it shows the local support for this product. So we are very confident with this. So with all this, where are we going? Where I see this company? Well, in the range of 54,000 tonnes of copper produce this year in the next 4 years, close to 60,000, grow into 91,000 tonnes this is just copper and copper equivalent. And then with Touro, we will be going that's an average of years with total another 30 [ transportation ]. So our company in, I would say, 3 years time with the range of 100,000 tonnes and 120,000 tonnes of copper, which is doubling the game when we doubled from 2015 to 2019. And why do you believe this the shareholders will benefit? The coppers grew up going up -- the copper consumption is going up in the left graph. I'm sure you have seen it. In lots of studies, it's going up simply because there's more people in the new work and there's more people living in the cities, they all want their car, their fridge, their TV. On top of that, it has been the normal growth as you can see in the right part of the graph, you have something that's been done, you know the country, which is a [ notification ]. It's not we are not talking about implications of vehicles. We're talking about the use of green energies to try to reduce the carbon CO2 of the world. So there is a clear increase in demand and consensus of deficit of around 6 million tonnes in the next 6 years. Six years is nothing. Six years is, it's a blink in the eye and you are there. The biggest producer, which is CODELCO release public information years released a few days ago. It's going down on their mines. This is their own thing. They struggle to keep production flat with huge investment, yes in the next few years. So it would be lucky if they can stay as they are and only in 2030, they may get some products -- new projects being constructed. And why only then? Just look at the right side of the picture, what's a real cost of [ audience ] in [indiscernible] Quellaveco, Cobre Panama I could also mention [indiscernible] in Mongolia, all between 8, 7, 6 -- $7 billion investors carried in 5 to 10 years. Very high capital intensities with lots of issues of the new ports and celebration water lines people, getting people. This is something that we don't have.

Ladies and gentlemen, please bear with me just while we reconnect to the room. Alberto, can you hear me from your machine? Alberto? Ladies and gentlemen, just wait momentarily while we get reconnected to the room, which is coming back in now. Alberto, you're back with us. Thank you very much indeed. You can see the slide deck in front of you. Ladies and gentlemen, thank you, we will just resume.

So in other words, each time it's getting more difficult, even if we wanted to we didn't even want to build new life, you want to fill this supply gap just to give you an idea of how big is this gap of 6 million tonnes. You can see it in the upper corner of this line. It's equivalent to the production of 5x of CODELCO what will be producing like 6x [ Kiruna ] which is the largest mine in the world like 20 mines of their vehicle. So simply, there is no time to build this production. So we are very confident that eventually when China starts opening up normal economy like the rest of the world is moving in this interpretation, that says sequence or a new life of the world. We are going to be seeing a huge consumption of copper, which can take a few years to come, but it's not a question if it will come or not it would be a question of when. Why would you invest in Atalaya? Well, in London, If you want to invest in copper, [indiscernible] in a certain ways other companies are copper of other metals. Here of the large companies. We believe we are very small obviously, but we believe we will be moving to the left side of the graph, where we can be a company with a much higher market cap and higher equity. And with that how do you take some questions from here and also to go and see the questions that have been submitted.

And at least we have two. So if I am going to read all the questions. And I have a very interesting and stuff and I would say untrue a question filled up untruth of lack of truth that normal with my behavior. I will answer, a reply and if possible as clear as possible. So I want to start reading the questions that I have here. So how do you see at Atalaya benefiting from energy transitions and the need for more and more help. Would you benefit from IRA in the U.S.? Do you see the benefits of having assets in Europe rather than South America and other jurisdictions? Yes we will benefit because copper price has to go up due to this energy transition and obviously we are very, very leveraged to copper. There's no such IRA in Europe or there's something similar where copper has been included in the critical metals, which means list which means that the Europe has given some instructions that some copper has to be -- some metal -- those metals have been produced in Europe and also gives some guidelines for permitting to speed up permitting. This will obviously be essential for totals because it will be very hard for the [ Lincoln ] authorities to say that they do not have the technicians and equipment and the knowledge and the controls to be able to construct the mine, while they're able to construct cars like as one of the big factors in Spain or ships or nice wines or nice clothes. So it would be very difficult for the government after this orders from Europe to benefit from this. And of course, yes, new benefit -- we believe that we are positioned uniquely in EU because of the safe jurisdiction because some of these mines that I've seen that I mentioned before that are needed to grow and to balance the market are in funny places like some parts of South America, some of the mountains of North America and parks, some countries in Asia or deep in the middle of making the title rounds, which are not going to be so easy and social security and like in the EU. EU can take longer, but it's a kind of safe jurisdiction. spending strategy, there is a problem with Spain. We have the largest lithium in Europe. Infinity Lithium Corporation the problem is subject to similar systems from local optimists, ATYM has a big expertise in permitting. Are there any talks with this group? Is there opportunity to present itself to a Well, [indiscernible] it's a tough question. I don't like to speak of other companies and this asset, it has opposition, but it's nothing to do with the position we have, actually as you have seen we have a lot of people are totally in favor. The only position comes from very specific small groups in [ Barbados ] that are against the mining in general and also against windmills against absolutely error in the case of this company, the project is very close to living houses. So housing will be at the edge of the bed when he was initially rejected now they're going on the ground. So the resistance is more due to the fact that there are people even there and they don't like to see [indiscernible]. Besides that I am not an expert on this product and I cannot say if it's interesting or not specifically this product. Doesn't mean we don't like we don't like lithium. Make it to the previous question. [indiscernible] If you're in [ cobalt ], is this being considered? Yes it's being considered. We have been looking at the [ Archero ] metals not only not only copper and specifically this metals, including here. Is Atalaya Mining 24 hours a day? Yes, of course. 24 hours a day, seven days a week. We only stop the plant for preventive maintenance, which is carried several months. Stopped the whole plant for a few days and then run again all the time. The race from last 8 years, can this be reprocessed with E-LIX? Any value? Actually, it's a very interesting question. I think E-LIX would be better used for high-value materials and waste with low-grade with not be a high value. But having said that it's a very good question because we have huge dumps, in fact around 0.2% copper and our cutoff is around 2018 at this copper prices. What does it mean? If copper prices went up to $5 per pound and I see that happening in the future, obviously all these dumps would be economic to be treated because you'll see already accounted for as a cost. So they don't have any mining costs, any waste cost. So they would be an additional resource that right now we are not contemplated. We're just keeping this store and yeah just in the store and in the future, it's written this. These questions likely to have been asked moving to the main board. Can you make this a priority? Yes, we have this priority. We were moving to the main board, and we had an issue with the taxes since the [ Brexit ]. Due to the UK not being in the EU, the Spanish authorities -- tax authorities considered that the main asset was in Spain. So selling, they considered that the company was basically selling shares of Atalaya Mining and being given a share of a new company called Atalaya Metals, which even had a name and that would trigger some tax payments in Spain and of course probably in other places due to the fact of being known to EU. So that route was take -- was removed, but we continue with moving to the main board and we plan to do this at the end of this year. That's the target. Basically, we'll be listing the shares instead of AIM moving and listing them in the main board. Besides that, we are looking also at least in the shares in EU jurisdiction country, you call it France, Spain or Netherlands because we have lots of shareholders that cannot buy shares a name or shares in the UK. You have a notion of acknowledged in the past that size is important for a mining company. We let the larger make a decisions to grow. We merge with other entity growth. I can tell you that we have looked at lots of companies. We have been signing CAAs and even making offers. Final offers and binding offers to companies and unfortunately, we were not successful because we really need to short-term to our shareholders. We will not merge for the sake of merging. Yes to grow for one simple reason it has to be something that makes sense and that creates value because dual shareholders will be asking you to dispose the manual version with somebody 50-50. Would you please dispose 50% of your shares to buy another company -- another 50% of the shares of other company? Yes, we go because we are larger. If it makes sense, yes. If two plus two is more than four, it's five. But normally, due to this fact of the market premiums and so on and some people are requesting cash. We did not see return and we didn't make any progress on that. And we will continue looking with patient -- patients and the opportunities we have acquired in the past have been also always with limited expenditures. What did they not look and you make a list? Well, this year we have a small dividend that has been approved due to the relative low cash flow generation. Although our policy will be to give a 30% to 50% dividend or equivalent to between 30% and 50% our free cash flow and we have been consistent to that. And I only have one long question, which is very interesting because normally, I think, I should have ignored. It could includes such a statements that I think would be unfair for the team and the company not to save. What is investment opportunity in Atalaya? 10 years of historic share price proves that simply there's none of the [indiscernible]. You can clearly see the excellent remunerational returns of executive board members and join the -- enjoy from the company during year, including their amazing ability to dispose of their free shares at historic heights. Well, I will stop, but it continues. I'll start saying this last statement of certain shares at historic highs, it contradicts with the fact that shame that the share price had been going down all the time. So something is wrong either one of the two statements which is also not true. Also 10 years of historic share prices prove that simply said one, but the team new team came into this company. I just checked our share price now was around [ 120 ] and it went down to [ 95 ]. I have it in front of me. Back in [ 15 ], we were under 100p either [ GBP 1 ], you're almost one year. We have reached $4 per pound and now we are around [ 320 ]. Well, I'm sure that going to COVID, going through two expansions, three expansions and still behaving like that has given you or this gentleman ample opportunity to dispose a shares. I'm sure he has lots of faith in our company, but it continues because also the rewards to the lawyers, accountants and procurement, it's funny. I think it looks like the lawyers and accountants and procurement suppose beans purchases are rewards, are not payments. I suppose in this gentleman, the shareholder, which I think I know the name and maybe Spanish. Our believes that the lawyers and accountants are work for free, especially if they're rude ones and procurement is you buy things also for free because probably this is what used to happen in the past, but the hard fact is that shareholders have had no return in real terms. Investors in the shares of a company do not see a return in their investment and do not hear -- or do so to see a return in their investment not to fear promises of returns not to see the executive board continually rewarding themselves. Their share price as I write is struggling about 3 in the past 10 years the price of copper has doubled but shares in Atalaya are now below the price prior to consolidation. I will continue then I will reply and that's why I know where it's coming from. Investors actually saw better returns on their investment when the business was struggling as a starter called EMED. why does -- Well, let me continue, price on the shares of EMED can say. This is how it went from around 3 up to 8, fantastic to drop in the same year under one. So a small drop up and down, after 10 years ups and downs, ups and downs and when we got the company back in 2015, actually had been going down after 8 years around 150 -- I mean around half of the price that it was initially in 2005. Why does the share price of this company fail to reflect the investment? But in the rises in copper prices profitability perhaps the Board appointed brokers are simply beyond the lifestyle of this business and force them and they cannot sell the investment [ story ]. Maybe it's true. The reality is that in the past, in this company you used to love, called EMED. They had offices in Sevilla, in Cyprus, in Slovakia, in houses paid by the company, paid by the company in Sevilla [ Aracena ]. Right now, we drive our own cars, go every day to them. We work hard. We don't have a minimal office that you can see it's quite humble. In London and we continue to work hard for our shareholders. So I do not accept this statements and I think they are unfair to the existing shareholders and to the past shareholders and to management and to the Board. I think I could not stop saying this. And that's all I think. I don't have anymore.

Alberto, that's correct. There's no further questions online. If there's anything in the room or if you'd like to hand that to conclude the online session.

Any more questions in the room?

[indiscernible] So the plant I understand it correctly once up and running next year, it will supply 20% of the energy costs, et cetera. Is it in your mind to expand that to the bigger plans.

So because we -- there's a certain limit. I mean the plant that's what they call big capacity, which is basically when the sun is up at 3 o'clock in the afternoon or less and that's -- at that moment, we'll almost be sourcing all our demand from the plant and minimum from the net. You still need to the net for technical reasons. If you expand beyond that you will need to store it somewhere, but you will not be able to consume it. So let's say our plan gives 50 megawatts and we consume 50 megawatts. Yeah so we size it to the maximum we could consume.

And the wind turbines?

We are still struggling to find the economics on that because they are so. We are not in a perfect wind area. The price that what they call the levelized cost of energy, which is the price equivalent of the energy that we produce with wind. In that case, we will be around EUR 45 megawatt hour. That's more or less the futures you can buy anyway. So it would maybe very nice for point of view, but from the economic point of view and you know it's fine easy, but we also have to be economic. But we continue.

Just going back to the solar in the U.K., there seems a bit trend to put excess it, let's just say the batteries.

The batteries again also what they call the levelized the cost of energy. Right now, it's over 100. So for a private consumer, maybe is yes because there's you know the consumption of energy of sorry the prices of energies in Spain at least they are lowering the midday due to the wind and sun and then there are higher in the sunset in the and on the sunrise. So those peaks if you have batteries and squints and when you have a higher consumption in your office, in your house waking up or going to bed makes sense for private consumers or in our case, I think this is still more economic to have a long-term price agreement with the consuming consulting company. And now if you look in the future prices in the, you could lock in EUR 56 per megawatt hour. So it's a there's a page called OMIP, which anyone can look at and you see the future prices started in January. Right now you can lock EUR 56. So there's no sense to put the batteries so far. In the future it will come up. It will come especially because you have hours during the day that the price is 0 and certain days will win and so on.

And just a question about foreign exchange. If the pound gets stronger against dollar and euro and dollar gets weaker against other currencies, all the impact beyond the profitability of the time?

The pound in euro, well I think the only changes for the share price because most of our costs are in euros or dollars. I would say 70% are in euros and 30% are in dollars. And dollars are treatment charges, shipping charges as mentors and things like that. And here in pounds, we don't have too much cautions. I mean there are some office costs, fees, listing fees, lawyers, accounting. So it doesn't affect too much. Yeah it doesn't matter. What's important is the euro. We would like a weak euro.

How realistic you think we're going to get onto the main market by the end of the year?

Indeed. Indeed, yes and as Alberto mentioned that was mainly because the transactions were suspected to retired and firstly coming to the U.K. and then after we're going to the main market yeah. So obviously be listed on the billion listed it's almost been a priority end of teams. So we have started doing some good work ahead and we're progressing. So we are buying data patterns and we have a lot of leverage of the work that we did last year. And we're in a very goo position to get it done as soon as possible. It is in our mind to get a job before year-end, but again you know we all suspected these last year out of order, it's difficult to rely on other people. It's exactly. I think according to an advisory says very little chance that we can have life back. There are always coming from things that you didn't expect that, but just to remind that this is a priority for the company and we know this is a feedback that we are consistently receiving from the shareholders and it didn't you know priority list and continue to be the operating list and we tried to execute as soon as possible.

In my view, it can only be very good once we get this on the main market because it opens up the doors for institutions that the sooner the better.

Any other questions? It's time of refreshments and it's more informal questioning.

That's fantastic. Thank you thank you very much. Thank you for updating attendees today. Can I please ask attendees not to close the session as you'll be asked has been redirected to provide your feedback and all the teams and expectations. Thank you and good morning to you. Thank you for attending Annual General Meeting. Thank you. Good morning to you.