Gold Royalty Corp. (GROY) Earnings Call Transcript & Summary

Good morning, everyone. I'm your host, Joanne Jobin, with VID Media. I would like to welcome you to our very first live Gold Royalty Investor Day, coming to you, I'll say it again, live from downtown Toronto. People are just starting to arrive. So a reminder that we will be starting at 9:00 a.m. sharp. So please settle in with the coffee and start submitting those questions into the Q&A tab, please, as per usual. We will be taking questions from the audience throughout the presentation. When the Q&A sessions are opened, questions from the floor will be answered first, and then David or someone from the team will ask if we have any from our virtual audience. As per usual, we will do our very best to get everyone's questions answered. We have a full slate today with David Garofalo, leading the charge with opening remarks. And the entire team will have their turn at the mic today. After that, we'll break for lunch and end the town hall. In the meantime, I'll be online until the meeting starts. So if you have any questions, I'm happy to chat with anyone and everyone here. Thank you. Now I would like to turn the stage over to David Garofalo, who will commence with our live Investor Day. David, over to you. We are now live.

Thanks. Good morning, everybody. I'm delighted that we have almost a full room here live, and we have quite a few people, I think, north of 150 online, and welcome to all of you looking forward to answer your questions over the course of the day or this morning as you say, as we go through our presentation. This is our inaugural Investor Day, one of what we think will be many down the road as we grow the business out. And I'm delighted that we're able to welcome all of our key executives here today to present on the business and provide a holistic overview of our strategy or vision but more importantly, introduce you to our people. We have a very capable and professional team. And this Investor Day is meant to coincide with the publication of our inaugural asset handbook our ESG report, both of which are available online. If you're here live, you can pick up a hard copy of the asset handbook as well. And again, we've been quite systematic about growing the business from 18 royalties initially when we IPO-ed just over 2 years ago to well over 200 royalties today and still continuing to grow much of it organically in a very low-cost fashion. I'll talk about that in a bit more detail over the course of the presentation. But we've built a sustainable business that's starting to contribute significant cash flow from our royalty revenues, from our extensive and diversified royalty portfolio in the Americas and one that's poised to go dramatically over the course of the rest of the decade. And within a year, it contributed to free cash flow for the first time. And that's remarkable in any line of business to go from startup to free cash flow for the 3 years is a remarkable achievement, and we're very pleased to be able to talk about that and talk about how we're going to deliver on that revenue growth over the course of the next year or so. But first, let me talk a little bit about the team. I'm very happy about the assets we've curated over the course of the last couple of years, but I'm even more delighted with the strength of the team that we've been able to assemble, a very accomplished team with significant mining experience. Andrew Gubbels joined us as CFO at the beginning of this year. And Andrew, many of you would have known from ARRIS Mining before where he ran the corporate development group. But before that, an extensive and international career in the investment banking side, principally with UBS, almost 20 years in the business. John Griffith has been a long-time partner of mine. He's our Chief Development Officer; Ryan Merrill Lynch's Mining Group before I was able to entice him to join us at Gold Royalty Corp. over 30 years of investment banking experience with significant experience in the streaming and royalty part of the business as well. He's done a number of transactions in that regard, and has been a trusted partner of mine over the years in running Goldcorp, HudBay, Agnico Eagle and providing banking services, accessing capital markets and helping advise on transaction. So he brings a wealth of experience in the industry and in capital markets. Sam Mah, who is our VP of Project Evaluation, Sam's here as well today. He'll talk about our evaluation criteria, due diligence process, we're quite systematic. And it's a testament to Sam's expertise as a mining engineer. He was a working mining engineer for a long time and joined us from SSR recently. But before that, spent 10 years with Wheaton Precious Metals during its initial 10 years and doing exactly the type of work he's doing with us, which is to evaluate streaming and royalty opportunities. So he brings a wealth of operating experience but also a wealth of streaming and royalty experience, in particular doing due diligence. So we're very delighted to have him in the team. Jerry Baughman joined us through the acquisition of Ely Gold. He was the co-founder of Ely along with Trade Washington Center Advisory Board. And Jerry's expertise as we talked about in terms of capital cost expertise and the Jerry's been the prospect in Nevada [Audio Gap] through that our organic model. And as you can imagine, the rates of return on those types of opportunities when they do hit are infinite. And we generated several quarters at virtually no cost because that's a source a meaningful source of growth in our royalty portfolio and no cost to our shareholders, no additional cost in units, again, just through trusted activity and extra. So we're very fortunate to have him on board. Alastair Still brings a wealth of experience as a Director of Technical Services on both the operating and mine booking side, Alastair [indiscernible] Goldcorp and Alastair for a long time, was a Senior Operations Manager at our [indiscernible] in Ontario GoldCorp and then he moved down to Argentina where he successfully developed the [indiscernible] mine, one of the biggest producing gold mines in Argentina. And he joined our corporate development [indiscernible] [Audio Gap] [indiscernible], which is our formal part company upon which we have royalties and every one of their assets in the portfolio. And what Alastair has done now, he will talk about this in a bit more detail later on, is systematic [indiscernible] derisk these assets in gold mining and put capital into them, which our is in the world [indiscernible] as he advances these projects, starts to bring in outside capital into them, starts to derisk them, drill them out geologically so we get the benefit of that for free in a royalty world. As we do with any of our royalties, all of our 120 plus royalties and we can leverage the gold price is increasing, but we also have to leverage on the exploration undertaken by our partners like gold mining with no cost [indiscernible]. For example, last year, over $200 million was invested or about 700,000 meters of diamond drilling on our portfolio of royalty properties, and we contributed nothing to that exploration budget. And so we got the lift in our value as a result of the exploration efforts of our operating partners like Alastair, but again, we don't have to contribute to those extensive and significant budgets. Peter Behncke, many of you will know is our Manager of Investor Relations and Corporate Development. John was employee #2. Peter was employee #3, and he's been instrumental in our acquisition, evaluations and also starting to develop a more professional investor relations program as we start to diversify our shareholder base and hopefully get some institutional traction. We've gotten certainly a lot more institutional meetings of late as we've seen our revenues start to grow and crystallize. Katherine is another example of our shared services model. We share Alastair with a number of other companies. We share Katherine with 3 other companies as our Head of ESG, and we're very proud that she's not only published our inaugural ESG report a Gold royalty, but she's in the process of doing that with 3 other companies within our ecosystem. And so it's one of the reasons we've been able to keep a very low G&A is that we share a lot of resources among the number of companies within that ecosystem within my partners companies [indiscernible]. And so we can share people like Katherine with significant subject matter expertise like Alastair, like our General Counsel as well that helps keep G&A costs low. We share an office space, again, rents very low. We actually don't pay anything in rent right now. We just share meeting space with Ameris companies. So that's allowed us to keep our back office costs low, our rent low so that we can maintain a low G&A cost as we grow revenue, that really falls right to the bottom line and contributes to free cash flow starting next year. And Ryan Hass joined us from Equinox Gold. He's our Manager of Operations, what he does day in, day out is make sure that we collect the checks on our royalties, audits those royalty statements and gets regular information flow from our operating partners, not only in terms of what we're old on royalties, but when we get exploration news that flows up through Ryan that we can communicate that to our shareholders and communicate the upside that we're seeing in the exploration efforts of our operating partners. But what Ryan also does ensure that we get also ESG data theater ESG report, among other things. So he does a day-to-day relationship with our operating partners, which has become a critical part of our business as we've grown out our operating portfolio of royalties quite significantly since our founding over 2 years ago. So I'll hopefully provide some brief introduction remarks, talk about our strategy, vision a little bit about the gold market as well before I pass it on to a very capable team to talk about all the aspects of our business in a bit more detail and entertain your questions, not only for me, but for anybody else that you see within this podium that you might have questions of and the various aspects of our business. So what I always like to do is really talk about the gold market. And I think you've heard -- many of you've heard me talk about our thesis on the gold price, and I think we've been quite consistent in terms of our views of the gold price and the fact that we're headed for a prolonged bull market. And we're gratified to actually start to see that thesis start to take some traction right now. And we started to see gold consistently above $2,000 an ounce, and we've been saying this when gold was as low as $1,700, $1,800 an ounce, that we are very much in an entrenched inflationary cycle. I don't believe the Federal Reserve, don't believe the central banks globally that are talking about tightening cycle. Indeed, we're in fact, in a declining real interest rate environment. And we think that will be amplified as we start to see nominal rates pivot later this year or early next. But the reality is inflation is far and above what the headline inflation numbers might indicate. Nobody in this room, I think, and nobody online believes that our inflation rates are only 4%, 5% or 6%. If you're putting food in your stomach, fuel in your tank or a roof over your head is deeply into double-digit territory. So these real interest rate numbers that you see in blue at the bottom of this chart are the headline numbers, but if you actually factor in real inflation and ignore the fiction that the CPI basket communicates, we're seeing real interest rates continue to decline deeper and deeper into negative territory. And the negative correlation since the U.S. dollar band, the gold standard early 1970s between the gold price and real interest rates is striking over that 50-year period. The gold price does exceedingly well in a declining real interest rate environment. That's precisely where we are. This inflation cycle is far worse than we saw in the 1970s. It bears many of the hallmarks that we saw in the 1970s. Back in the early 1970s, we had the U.S. dollar decoupled from the gold standard, and we saw a massive amount of mandatory expansion to fund economic activity, to fund a war in Vietnam. We saw very similar on mooring fiat currencies in the great financial crisis in 2008, where we saw global corrugated efforts to debate paper currency, expand money supply, it's gone up exponentially. And central banks are being disingenuous by raising nominal rates, but then flooding the market with additional liquidity when there are bank failures as we saw a couple of months ago. So there is a bit of stocking of going on by central banks. Make no mistake about it, monetary expansion is continuing in a dramatic fashion. And interest rates will reflect that nominally, we think by as early as next year as the Federal Reserve has to pivot to deal with a massive amount of debt that we've strapped on as a society. Global debt to GDP, you've heard me say it's 50% today versus 100% in the 1970s. There's very limited latitude for the central banks to dramatically tighten and raise real interest rates without bankrupting governments, corporations and individuals. There's just too much debt in the system. The only conceivable way to deal with the debt is to inflate it away. Central banks want inflation, inflation is here to stay. And gold will do exceedingly well in that environment as declining real interest rates start to take hold. And really, again, you've heard me say, if you bind to that thesis, the best place to be is in the royalty business. And it's no mistake that a number of us and our Board and management who have been operators and mine developers over much of our carrier and I've been doing that for over 30 years in my career, I switched to a royalty company. We all firmly believe in the bull scenario for gold, but we also understand that operating companies are not immune from cost inflation that we've seen in the sector. And many of you also know that on-site costs typically are 60% labor and energy, and that's where the inflation pressure has been most acute, and that's why we've seen a significant resetting of cost expectations across the operating sector in the mining business. And again, I think that's going to continue for a long period of time. And that will undermine the leverage proposition that you're looking for in gold equities when you're buying an operator. And the other dynamic in the operating side of the business is the sector is shrinking. The value in the ground of their businesses are shrinking because reserves are declining dramatically, and they have declined dramatically over the course of the last decade, down 40% because the industry simply has not been reinvesting back in exploration. And that's why you're seeing Packman underway in the operating side of the business. That's why you're seeing a massive amount of consolidation because if you're not finding it in the ground, you're going to have to buy it. And just to share a bit of an analogy, until recently, John and I were responsible for the biggest gold merger in history, Goldcorp and Newmont. Obviously, that's been Eclipse, the Newmont Newcrest deal. But I remember sitting across the datable from Gary Goldberg, the CEO of the time at Newmont saying, "Collectively, we have 7.5 million ounces of production a year as Goldcorp and Newmont together, but we don't want to be at 7.5%. We can't sustain that. We're going to call some of the noncore assets, and we're going to be able to sustain 6 million ounces a year for 20 years." That was the thesis. Four years later, Newmont has not been able to sustain that. They've had to do Newcrest, they get back up to that 6 million ounce range. And the reality is because the industry has not been reinvesting back in exploration to replace depleting reserves. And importantly, the juniors have not had access to the capital markets in any consistent fashion. And they are the ones that do the heavy lifting and grassroots exploration. And if they're not doing grassroots exploration or not accessing capital to do that, the industry will necessarily shrink and necessarily cannibalize itself. And that's what's happening in the operating side of the business. And that's why I think that's a shrinking pie and will continue to shrink. And the royalty business as capital inevitably gets allocated back to exploration and development out of existential necessity will be an important -- an important provider of capital to the explorers and emerging developers to replace the shrinking pie of reserves in the industry. But again, providing you top line exposure while protecting you from inflation. So it is a better way to invest in gold. It gets you that precious metal exposure, gets you the exploration exposure as well, but without having to pay for it and gets you diversification that no operating company can hope to deliver to you. And we have over 220 royalties. And with the people you have here, and this is pretty much the whole team sitting at this front desk here, we could run a business 10x the size. We can scale this without having to scale up our G&A. And in fact, our G&A costs have come down 30% year-over-year, and I'll give Andrew an opportunity to talk about that in a bit more detail. So we can and have diversified dramatically. And that's, I think, a key and attractive feature of being in the royalty business over and above that top line exposure, while protecting you from cost inflation. And again, the reason we've been able to grow this business so quickly, so dramatically is the depth and breadth of our management board, which collectively have over 400 years of industry experience. So this gives you an overview of how quickly we've grown the royalty business, but we've been very disciplined geographically about where we've been. We're very disciplined about the geological models we invest in. We do extensive due diligence, which we'll get into in a bit more detail. But I think this growth is quite dramatic. And I think unparalleled in the royalty space since we came into an existence a little over 2 years ago. Again, another important part I talked about our management team is we have a very, very strong board as well. Warren Gilman has been in the business as long as I have over 35 years investing in the business. He's been a banker. He's a mining engineer and now he's a portfolio manager one in Queen's Road Capital in Hong Kong, a cornerstone investor in our IPO and an important steward of our capital. Alan Hair worked with me at Hudbay. He was my successor CEO, he's my COO, a prolific mine builder in his own right, 35 years as a mineral process engineer. He built the Constancia mine in Peru. He built the 777 Mine in Manitoba, the Lalor Mine in Manitoba, the Reed Mine in Manitoba, so it brings a wealth of technical expertise to the Board. Glenn Mullan joined us. He's the cofounder of Golden Valley in Abitibi or founder, I should say, of those companies. And like Jerry brings a wealth of expertise in prospecting and staking and generating royalties organically. And through his companies an arrangement we have with him, and we're able to continue to generate royalties organically within Quebec and Ontario. So he's been an important contributor to our growth since he joined the company about 1.5 years ago. And then the last person I'll mention last couple of people, Amir Adnani, my partner, a co-founder of Gold Royalty also controls 15% of the company through his vehicle Gold Mining Inc., which I'm involved in as well. And Ian Telfer, many of you obviously will know who was my Chairman at Goldcorp and was the founder of Wheaton Precious Metals and pioneered the whole streaming model with Wheaton about 15 years ago. And so it brings a wealth of streaming and royalty experience to the table and has been an invaluable contributor to our success since we launched a little over 2 years ago. You've heard me say this before, the re-rate potential in the small-cap universe is immense, particularly when you look at where the category killers are trading, the big caps, Wheaton, Royal Gold, Franco-Nevada at 2x to 3x net asset value. You can start to see Triple-Flag and Osisko have been creeping up gradually, trying to capture that multiple as well, and they're doing that through scaling. And that's what we've been endeavoring to do since we launched is scale does matter. It does become institutionally relevant. If it becomes institutionally relevant, the stock will get bought, your multiple go up, it drive down your cost of capital and create a virtuous cycle in your business. Cost of capital absolutely critical in our business because we're a capital provider. And so trying to get our multiple up through this re-rating through the scaling of our business. We can certainly do that organically with what we already own and given the cash flow growth profile, which we'll get into in a bit more detail in a few more minutes. But we can also do that through M&A. I do expect that this smaller cap universe will continue to consolidate and capture a mid-tier vacuum that currently exists in the space. There's a large cap and then there's a small cap, not a lot in between. If we can capture that mid-tier and then I think we can capture a multiple that could conceivably be superior to what the seniors provide because what we can provide if we capture that mid-tier is the prospect for growth. It's very difficult as high a quality as Franco, Wheaton and Royal are -- royalty companies, they can't capture any growth given the scale. It's very, very difficult for them to grow significantly. And so that's the opportunity I see in the sector. Looking at it from a 30,000-foot perspective, is there a scope for consolidation. In fact, since we launched 3 -- 2 years ago, we absorbed 3 of those companies, Ely, Golden Valley and Abitibi Royalties, but 5 other companies have been absorbed by our competitors as well, including Maverix and Nomad, among others. And so the consolidation cycle is happening in the royalty space, and we believe will continue to happen until somebody captures -- maybe 1 or 2 companies captures that mid-tier crown and captures that growth multiple that clearly is absent in the sector right now. So with that, I'd like to pass it to Andrew Gubbels our CFO, to walk you through our financial results for the first quarter and talk about our financial position as well. Thank you for your attention this morning.

All right. Thanks, Dave, and thanks, everyone, for coming. Let me start off by saying Gold Royalty Corp. is really emerging from a transitional period, whereby the foundation of the company was really built from a successful IPO through to a series of transformational acquisitions. It's been very important for building that solid foundation from which we can now grow. We now have a consistent cash flow base, some quality assets and a very robust pipeline of projects -- development projects that are being built by some of the gold industry's largest, best-capitalized operators as well as a long tail of exciting exploration properties. Moving forward, we're going to see increased cash flow from our royalty portfolio as these high-quality projects are constructed and commissioned. At the same time, we are expecting our recurring cash operating costs to decrease and moderate post the integration of these prior acquisitions that I mentioned and the establishment of a real core management group and efficient operating structure. Now let me start by giving you a snapshot of our quarterly results for the first quarter of 2023, which we announced on Thursday of last week. Investors should be aware that we did change our fiscal year-end from September to December last year. So this is officially our Q1. So in the first quarter, we saw revenue from -- and option proceeds increased by 12% quarter-on-quarter. Now this is the second highest quarterly revenue figure that we've had since our inception. In Q1, we also saw a cash operating cost decrease, as Dave mentioned, it decreased by about 30% quarter-on-quarter, and recurring cash operating costs decreased by 26%. So it shows that we're moving in the right direction when it comes to managing our offering costs. In Q1, we closed an asset swap transaction with Val d Or Mining, VZZ and also generated some additional royalties in Nevada, which Jerry will talk about a little bit later in the presentation. In total, we added 12 new royalty assets to our portfolio. We also increased the size of our revolving credit facility in the quarter by $10 million to a total of $35 million, including the accordion feature. And that does provide us with additional liquidity to support our growth in the future. And finally, we paid our fifth consecutive dividend. We currently yield over 1.7% at current share prices. And we also established a dividend reinvestment plan. And that will allow investors to take shares instead of cash if they choose and allow the company to reinvest some of the cash back into growth initiatives for the company. So all that plumbing is in place now for investors in the future. Now in terms of outlook for fiscal 2023, we do expect to see increased revenue despite the temporary suspension of operations at Jerritt Canyon. We have provided guidance of $5.5 million to $6.5 million of revenue and option proceeds for the fiscal year 2023. This is really driven by revenue from royalties at Canadian Malartic, at the Borden Mine and Isabella Pearl and option income from our large growth portfolio. Now what's not on this chart, but in 2024 and beyond, we do expect revenue to increase materially. And we haven't put out guidance for future years, but all the brokers in the room have put some estimates for our revenue, we will see a step change in that revenue come 2024 and going forward. On the cost side of the equation, for fiscal 2023, we are targeting decreased recurring operating costs. 2021 and 2022, as I mentioned before, were really transitional periods as we set up the company. It included higher costs related to insurance, insurance for new companies, especially New York listed companies are on the high side. We had elevated marketing costs and consulting costs associated with some of the M&A to build that foundation of our business. In 2023, however, we are working to and have done quite a bit of work centralizing some of the administrative activities within our subsidiaries, bringing it into head office. It's an initiative, I've done quite a bit of work on today. We've refocused some of our marketing and professional fees, and we're finally starting to benefit from decreased corporate insurance costs as the company matures. So we do expect to see recurring operating costs moderate at that $7 million to $8 million level and continue around that level on a recurring basis going forward. And as a result of this growing revenue, of which, again, we'll see a step change post 2023, in particular, and decreasing costs. Operating margins from recurring activities are expected to increase and improve in future years. Now next, I just want to talk about some of the sources of capital we have available to us. Having access to capital is critical to our strategy. As Dave mentioned, we are -- the thesis for consolidation is strong, and we are looking to grow this company. Gold Royalty does enjoy a healthy balance sheet, and we have put financing programs in place to be able to access capital when -- and if it's required. We have approximately $10 million of cash and marketable securities on the balance sheet at the moment. Earlier this year, again, I mentioned before, our lenders were supportive of enlarging our credit facility by $10 million to $35 million in total, which gives us a good convenient access to that credit facility on a revolving basis. We also have approximately $50 million of capital available under our ATM facility, which was put in place mid last year. And finally, GRC filed a $250 million shelf prospectus in mid-2022. That will allow us to facilitate the access of additional equity capital if required in the future. So when it comes to M&A and acquisitions, we'll evaluate all sources of capital to fund future acquisitions, the choice of which will really be dependent on the size of that acquisition and on the cash flow profile of those assets that we do acquire. Now finally, I want to let talk a bit about the trading liquidity of Gold Royalty. We've really built a strong market presence. I think this is an important characteristic that differentiates us from some of our peers as well. We have solid trade and liquidity we built up over the last 2 years. We currently trade on average over $1 million worth. It's $1 million worth of shares on the New York Stock Exchange every day. And it takes -- the amount of time it takes to turn one turn of our float is about as frequent as some of our larger peers. So in terms of getting in, getting out of Gold Royalty shares, it is an easier proposition than some of the smaller peers in the sector. We also have strong research coverage with additional brokers preparing to launch coverage throughout the year. I know many of the institutions are room today, so I'd like to thank you for your support to date and we look forward to your continued support going forward. And now with that, I'd like to pass it on to Katherine to speak to our sustainability and ESG.

Thank you, Andrew. Good morning, everyone. My name is Katherine Arblaster, I'm the VP of Sustainability and ESG for Gold Royalty. So I'm going to talk a little bit about our approach to sustainability, our management of ESG-related risks and also to talk a little bit about how we've embedded sustainability as a core value in our organization. So fundamentally, we believe mining can be an important mechanism to achieve sustainable development, and we believe that mining can enable positive contributions to the local community. As a royalty company, we recognize that we don't directly manage many of the ESG-related risks that sit at the underlying assets of our portfolio. Therefore, it's important to us that we're ensuring the quality of our operators, and we're partnering with leading miners that are focused on sustainable mining practices and then also throughout our process that all of our operators are aligning to our ESG core values as well as meet our rigorous ESG due diligence process. So I'm going to start with a little bit of an interactive session to keep everyone awake this morning and to get everyone talking now, as I know we have our Q&A happening in a few minutes. So if you see up on the screen, there's 2 earths. On the left-hand side, you'll see the gray earth with the blue bubble. Does anyone who's a brave enough to raise their hand this morning, I want to share with you what they think the blue bubble represents. I know none of you are shy. I want to say there's no wrong answers, but there are wrong answers, but there's always good guesses. I can look up here at the front table and see if anyone has an answer, Sam.

It's got to be water. It's got to be water.

That's right. So the blue bubble represents all of the water on the ear surface to scale compared to the earth. On the right-hand side, you'll see the Blue Earth and the pink bubble. Does anyone have an idea of what that is?

I believe it's air.

That's correct. The reason I wanted to show this picture is it represents the urgency around things like the climate crisis and the sustainability and the use of our natural resources. So generally speaking, many of us, mining companies included, treat water and air as infinite. But it's very clear that they're actually finite. So this is a call to action for organizations like Gold Royalty that we need to be very mindful of the way that natural resources are being used so that we can ensure that they're going to continue on into the future and that our organizations in our portfolio can continue to rely on things like water and the climate. A few other data points that always, I think, really drive home the point around the urgency of the climate crisis and sustainability are that I'm sure many of you are familiar with the global goal to keep global warming between 1.5 and 2 degrees Celsius. Well, the UNs released recent research that shows that we're actually very likely to surpass the 1.5-degree warming goal, and we're actually likely to hit 1.5 degree warming probably in the mid-2030s. There's also a date that I know as a sustainability practitioner iTrack, which is what we call Earth Overshoot Day. And that's the day of the year that we've used all of the Earth's natural resources that could, on their own, regenerate throughout that year. Last year, in 2022, that was July 28. So many research has shown that we would actually need 3 Earths to be able to live at the current pace that we're living in our current use of natural resources. So I bring that up not to be all doom and gloom in the morning, but really to demonstrate that sustainability is a really important value for us as an organization. And we ultimately are committed to ensuring that our operators that we partner with are ensuring that they're using sustainable mining practices that are mindful of things like GHG emissions being released into the atmosphere and their water usage. So at Gold Royalty, we're committed to addressing many of these challenges through appropriately and proactively managing risks related to water, biodiversity and climate change. To demonstrate that commitment, we've joined the UN Global Compact, which is the voluntary initiative based on CEO commitments to implement universal sustainability principles and commit to accelerating progress to the SDGs. We've identified 7 SDGs that we feel we can contribute to both internally within our organizations and then also through our partnerships with leading top-tier operators. And we think about sustainability as a two-pronged approach. So there's sustainability within our organization, and that's us being a steward for our people, for our local communities and for our environment. And as Dave mentioned, we have a very lean team. Most of the team is here in this room. So as you can imagine, our footprint is pretty small. Our Scope 1 and 2 emissions from our corporate office, very minimal. So we recognize and the second prong of our sustainability approach is thinking about the impact of our portfolio. So we recognize the Scope 3 emissions from our mining operations are much more significant than our Scope 1 and 2 emissions. So we think about this as our approach to ESG due diligence to ensuring that we're working with responsible and leading miners and then are also thinking about how do we support them to reduce things like their emissions, their water usage, et cetera. So we're proud to say that in FY '22, so last year, we were able to contribute over $20,000 to diverse community causes, including the Arts, mental health and culture in the Vancouver area. We also prioritize diversity and inclusion on our Board, 29% of our Board members are female, and we have a goal of reaching over 30% by 2025. Also within our executive management team, 30% of our leaders are female and 50% identify as ethnically diverse. We also focused this year on really laying the foundation of our sustainability program. So we focused on updating our sustainability policy, which really sets the guardrails around our commitment to sustainability and how we plan to work with our operators. And we've approved things like our anticorruption policy and insider trader policy. A big focus of that sustainability policy is the reflection on our ESG due diligence and the rigor that we ensure within that process. And so last year, over -- well, 100% of our agreements were reviewed with our enhanced ESG due diligence process, which I'll speak to in a few minutes. And we did screen out 11% of deals because of ESG-related risks. For example, jurisdictional risk, as Dave talked about, the quality and location of our assets, jurisdictional risk is one thing that we watch very closely, along with ultimately looking very closely at things like water practices and usage. I see a question here, but I know we're going to go to Q&A in just a few minutes. So why don't we -- I will come to you first. So ESG governance is very important, and this is really what enables us to remain accountable throughout the organization. And I think this visual helps demonstrate how we've embedded sustainability as a core value throughout the organization. So our Board has oversight over our sustainability approach. For every deal that we bring to the Board, we spend time reviewing the ESG-related risks that we identified for that organization or for that asset specifically. And then our ESG Committee goes a lot deeper. So they work with me and with Dave on our ESG strategy as well as progress against that strategy on a quarterly basis. And then we've also embedded sustainability throughout every aspect of the organization. So our strategic planning process, we discuss our ESG objectives and how we plan to achieve those naturally in our corporate development process, which really focuses on our ESG due diligence and then as well our risk management process, we identify a lot of the ESG risks throughout that process, and those get elevated to the Board as well. So ESG due diligence is really a central focus of a lot of how we ensure the quality of our portfolio. And I know I've mentioned it before. And so we've listed out some of the key areas that we look at as a part of our ESG due diligence process. And I'll just speak to a few of these and really kind of the focus of them. So for example, water management is something that I mentioned as an area that there's some urgency associated with. So we look at the operators' management processes associated with water usage, but we also look at where the water source is that the mining company will be using. And if other communities local to the mine site are also relying on it to ensure that there's a plan in place to ensure that, that resource is going to be responsibly managed. We, of course, look at tailings and waste management. We look at the biodiversity and in particular, the mine closure plan to ensure that there's going to be some focus on regenerating any damage that's been made to the biodiversity near the mine site. And then, of course, you look at climate change in the emissions management. So as all of you know, there's some urgency around climate change, and there are going to be targets coming in for many companies at 2030, 2040 and 2050, to reduce their emissions. And so if you think about the life of mine, many of those will go into and surpass 2030. So we do look to see if operators are planning for that or building and those associated costs to decarbonize as well. From a social perspective, health and safety is essential, we want to ensure that the companies have an appropriate management system in place and that they have a strong record around health and safety. We look at things like how they earn the social license to operate, how are they working and engaging with the community. And in particular, if there's indigenous communities, how are they engaging with those indigenous communities and do they have the right to work there. Human rates is essential, and we ensure that there's been no human rights abuses and then we also look at labor management. And then from a governance perspective, we look at how the company operates internally from an ethical standpoint, and we also look at from a Board perspective, does the Board have oversight over any ESG-related risk that they've identified. And then finally, we've spoken to political and jurisdictional risk. That's a key one. So we always look at the regulatory environment and the political environment in the countries that these operators are working in. And then finally, I mentioned that we screened out 11% of our deals because of ESG-related risks. We also look to partner with our operators to see how we can help them further advance our sustainability goals. So there's many different ways that we've done that. In some ways, for example, we've offered pools of capital to help them further their sustainability objectives that would come alongside the royalty agreement. So very much, we kind of use that two-pronged approach where if the risk feels too high, we'll screen out that opportunity. But ultimately, we do look to help advance our operator sustainability goals. And then finally, I'll just -- I know Dave mentioned, but I'll make a plug for the sustainability report. We're very excited to have been able to publish it this year. It's on our website. I would definitely encourage you. If you're short on time, please read the CEO letter from Dave because I think it highlights a lot of the achievements that we're most proud of. And then I'll invite Dave back up for the Q&A.

I think you had a question...

Yes, I think there's one right here.

The 11% that you mentioned for the royalty and you said 11% were screened due to ESG concerns, right. Okay. So what does that mean? Can you elaborate on that?

Yes, absolutely. So -- and Sam is going to speak to our due diligence process later on in the session. But ultimately, as we go through our due diligence process, we'll look at things like jurisdictional risk. So are we comfortable with the political and regulatory environment that, that asset operates in? Or are we comfortable with their health and safety record or their social license to operate. And so if we have identified a risk where we felt like the operator is not managing that risk appropriately, and we'll engage with the operator and have conversations with how they plan to manage these things. But if we're not comfortable with that, then we'll ultimately turn down that opportunity because we feel like it will either lead to delays or significantly affect the capability of that asset to move forward. So jurisdictional risk is a big one because we really prioritize mining-friendly jurisdictions, which I think goes back to the quality of our portfolio. So I don't have a breakdown of specifically how many were jurisdictional risk versus others, but that was a major one that we have screened out for.

Any other questions of Katherine on the ESG side, while we have her up here? Significantly understated a role when I talked about the ESG report almost explicitly introducing her. She is very much embedded in our due diligence process. She reports to the Board and to other senior management on our assessment of the ESG risk of every opportunity we look at. So she's integral to that. So it's a significant part of a role, and I want to emphasize that. Reputational risk is extremely important issue to manage. It does drive cost of capital, particularly in this environment where ESG is top of mind for many institutional investors and capital providers. So we have to be absolutely crystal clear and crisp on that issue. And so I'm delighted that we have somebody of Katherine's expertise and background in the organization. Yes, Brad?

Can you break down the revenue versus oil versus...

Speak into the mic, sorry.

Can you please break down the revenue between option income and royalty income? Because, Andrew, I think, mentioned that there was some option income are we covered -- are we writing options or puts? Or like we...

No, no. Option income refers to option payments we get from operators who we option our properties out to. So we get a royalty back on return. Quite often, we have work commitments, so they're required to work the property so many dollars per year. And then they also pay us an option on the property. They actually pay us fees for taking the property from us. So that's not -- it's not derivative income. I don't want to -- it's actually on the grassroots income from the properties. We never actually spend any -- invest any money in exploration ourselves. We farm the properties out before it gets to that point. So they take the exploration risk. We get paid royalties and option proceeds and return for the property.

So what was the breakdown between royalty income and option income?

Peter, do you want to -- do you want to get to that chart now, Peter, do you want to just deal with it verbally?

I've got one other question after that.

Yes. Sure, you can stay up, Dave. Yes, the breakdown is about $3 million, $3 million in 2023, and we've consistently generated between $2 million and $3 million in option proceeds. The past 2 years and going back before that, through Jerry's model at Ely Gold Royalties before we acquired them as well. So it's a sustainable, consistent source of cash flow for us is that option proceeds income.

Okay. Now a good chunk of the G&A decline was because the D&O insurance came down, correct? Does that -- was that decline based on your ensuring a smaller market cap because the stock did so poorly? Or is that declined because it was a decline in the actual policy?

Yes. No, it was a decline in the policy. It really -- the insurance market, our D&O insurance as a new company without a track record, tends to have higher premiums. So it's really establishing a track record regardless of our market cap. The year-on-year as long as we don't have any claims, our insurance has dropped. So it doesn't have anything do with market cap.

Thank you. How much is drawn on the credit facility?

This is approximately $10 million drawn. So it's -- the credit facility is a $20 million revolver, $10 million of which is drawn. We also have access to a $15 million accordion feature, which has some other constraints, but $10 million of the $20 million revolver is strong.

And along the same line, how much is left on the shelf?

So the shelf was a $250 million shelf. The shares that we issued as part of consideration to Nevada Gold Mines per transaction last year, I think it was around $20 million, $22 million, $27 million worth was credited against the shelf. So we've got the remaining available.

And second question for me, maybe for David. You talked about the lack of juniors, the availability of financing for the junior producers or explorers. Have you seen that improve with the higher spot prices?

No, not at all. It's been very selective access to the equity capital markets. It's really been a nuclear winter for juniors. Other than a brief window in 2019 when we saw the gold price start to regain some momentum. And it was right after actually the merger activity in early 2019, we saw about a 6-month period where juniors were accessing capital, again, then the door firmly shut again. So again, over the last decade, it's been very, very selective access, and that's why you've seen this 40% decline in reserves. The industry simply isn't reinvesting in exploration in a meaningful way. So were there any more questions? Joanne, in the room, please yes, go ahead.

Would you mind identifying yourself before answering.

George Foster. My question is, I'm looking at the asset handbook. And I know most of the properties are in the Americas. You have one in Turkey. Now is there any plans to expand in other areas like Africa or Scandinavia, et cetera?

Yes. Certainly, it's interesting. About 80% of our royalties by number and by market value or net asset value are in Nevada, Quebec and Ontario. So it's very concentrated in 3 of the best -- arguably 3 of the best jurisdictions in the world. We certainly have room to take on a bit more political risk. But what will drive our decision-making, and John will get this into a bit more detail later on is quality of the geological model, quality of the operator and our comfort with the jurisdiction because at the end of the day, we don't own any mines. We own paper. We own contracts. And if there is any legal framework that recognizes the sanctity of those royalty contracts, then we won't go there. Because we want to ensure that we have security against the asset in some form to ensure the royalty contract survives. If there's a change in operator or a bankruptcy of an operator, and that's the appeal of being in Nevada, Quebec and Ontario, is that legal framework is extremely well established and well respected.

Rene from BMO. Can you just talk a little bit about the longevity of the option proceeds. How long you think that you're going to continue on for? And then also maybe just give us a little bit of color in terms of when you... [Audio Gap]

And then any gain beyond that is setting the income statement. So it is on a case-by-case basis, and I can't really provide more clarity on -- it really does depend on what deals Jerry is generating each quarter.

I think to your question, Rene, that's why it's important that we provide a normalized revenue number with that option income that goes against carrying value extracted so you're aware, you have clarity and transparency about how much option income we're generating regardless of the accounting treatment. The accounting treatment is a bit nonsensical, but it is what it is. Okay. Excellent. Then Joanne, we're okay to move on to the next section.

Do you want to take any questions on the audience at this point?

Why don't we pause there and let the next section come up, and then we can take some more questions before break. So if you're budgeting for a coffee break, let's assume it happens in about half an hour, I guess, Peter, and then we'll take a 10 to 15 min break from there before the next section after that.

Perfect. So everyone, and thanks for the questions. Good to have a dynamic conversation. My name is Peter Behncke. As Dave introduced at the beginning, I'm our Manager of Corporate Development and IR. I've been at the company since 2020 when we were writing our original '18 royalties, and it's been exciting to see us grow to a portfolio of over 220 assets. I'm going to provide an overview of our portfolio, run through some of the metrics that are outlined in the asset handbook that you have there. And then we'll take a short break before coming back and having Ryan and Alastair do a deep dive on some of the key assets in our portfolio and get into the weeds on those. So zooming out and taking a look at the key metrics that really define our portfolio. We've already spoken at length with regards to the jurisdictional exposure concentrated in the best mining jurisdictions in the world, the recent Fraser Institute report outlined Nevada as the best mining jurisdiction in the world. And that is where we have the most royalties in our portfolio, close to 90 currently in a close second, over 70 royalties in Quebec and another 30-some-odd in Ontario. And I think that speaks to the quality of our portfolio, not just quality of jurisdiction, but quality of asset with cornerstone royalties on 3 of the largest mines in North America as well as quality of operator. These assets are being developed or operated by the largest and most well-capitalized companies in the mining sector, the likes of Barrick, Newmont, Agnico Eagle. The growth has been very rapid, '18 to over 220 in just over 2 years, but that focus on acquiring a foundational portfolio of assets has really been top of mind throughout. An important aspect of our portfolio is our commodity mix. We are a gold royalty focused company as the name begets roughly 95% of the portfolio by net asset value is in precious metals, gold and silver. And we do have some copper exposure in some gold copper porphyries through Alaska and South America. I think important to note, as we continue to grow the portfolio, we do have the ability to take on some commodity mix, whether that's additional copper, zinc, nickel, but core to our business is precious metals and we'll maintain -- be the focus. So we've -- I mentioned them, our 3 cornerstone royalties, royalties on the largest gold mines in North America. The largest of which is our 3% NSR over the Canadian Malartic complex, specifically the Odyssey underground project. Our 3% NSR covers a significant portion of mineralization of the East Malartic deposit, the Odyssey North deposit and the portions of the Norrie zone and the internal zones, which are getting continued exploration investment by Agnico subsequent to its recent consolidation of the assets through the acquisition of Yamana. This asset is ramping up over the next several years but really shifts to a full underground operation where we'll see the full benefit of our royalty there in the years 2027 and 2028 when the open pit is done producing at Canadian Malartic. Our second cornerstone asset is our royalty over the Côté Gold project. We have a 0.75% NSR over the southern portion of the Côté pit. This is the most immediate catalyst within our portfolio and is the key driver of that inflection point that Andrew spoke to earlier with regards to shifting to positive free cash flow and really driving our revenue growth in 2024. IM Gold has done a good job divesting noncore assets, restructuring the ownership there and are well on track to deliver First Gold Pour early next year. Our third cornerstone asset is our royalty over the Goldstrike mine, specifically the REN project, the northern extension of the Carlin complex. We have a 1.5% NSR and a 3.5% NPI over this deposit. This is a very high-grade component of the Carlin complex, roughly 7 grams per tonne material, close to 2 million ounces and continuing to be explored by Barrick at the Carlin complex. Interestingly enough, we have 3 foundational assets that represent over the 50% of the value of our business in these 3 assets alone. And these are the foundations that built the largest royalty and streaming companies in the sector. Franco-Nevada, the largest royalty and streaming company. It was built upon a single royalty over the Goldstrike mine, and we also have a piece of Goldstrike through our royalty over REN. Now beyond these 3 cornerstone royalties, this is a slide I'm sure many of you have seen before, is our pipeline of development producing advanced exploration and earlier exploration stage assets, representing the over 200 royalties we have within our portfolio. I'd get ahead of the question. We do have Jerritt Canyon outlined here in our producing assets. Now Jerritt Canyon is an asset that's first majestic the operator has had difficulties with. They continued to process ore there for the first 2 quarters of this year, but are shifting the asset to care and maintenance, and we'll do the same in terms of our buckets and asset classification in early next quarter. Beyond Canadian Malartic, Côté and REN, we're very excited by several of the other smaller royalties within our portfolio that supplement the growth. As I mentioned, that's roughly half the value of our business. But with another 219 royalties in the portfolio, there's a lot of exciting catalysts across the board that are fueling growth over the next coming years. On this slide, I'd also like to highlight the operators. I mentioned the likes of Newmont, Barrick, Agnico Eagle. That not only gives us confidence in the development pipeline, they're well capitalized, can deliver on that growth. They have great track records, but it also speaks to what Katherine said earlier with regards to our commitment to sustainability. These are leaders in that regard and really align with our views on best practices and the assets we want to align with. So providing a bit more granularity with regards to our revenue profile over the next few years. I wanted to lay out a chart of the key producing assets and where we're seeing growth in those. Some of the key development stage assets that we're seeing come online or potentially reenter production over the next few years and then also highlight some of the key development stage or advanced exploration stage assets that we see as opportunities for future growth, but aren't necessarily fueling our near-term cash flow profile. The first 2 I want to highlight, I've spoken at length about the Odyssey mine as it shifts and ramps up over the next few years to a fully underground operation in 2027 and 2028. Ryan will speak to that in more detail. But it really is the initiation with that asset entering production early next year. This will be a significant increase in our revenue profile expected to increase overall total revenue and option proceeds by over 50% next year. Beyond these 3 over the Gold Rock project, this is a satellite deposit to Caliber's Pan mine in Nevada. We have a 0.5% NSR over the entire project. They're expecting to release a feasibility study and make a construction decision in 2024. And by consensus views on caliber, we can see revenue from this asset starting in 2025 as an incremental portion of growth would be about a 50,000 ounce a year producer. Jerritt Canyon, as I mentioned, unfortunate circumstances with their temporary suspension of operations, but they continue exploration work and are evaluating how they can re-optimize the mine plan to potentially restart operations there. We stripped it out of our revenue guidance and our forward-looking revenue profile. And now this asset really represents a potential area of upside for us should they restart it over the next 2 to 3 years. While it was $1 million of lost revenue in 2023, I'd note that this is a relatively small portion of our overall net asset value, an asset that makes up roughly 1% of overall NAV. Similar to Goldrock, another smaller royalty within our portfolio is our royalty over the Railroad-Pinion project recently acquired by Orla. We have a patchwork of royalty coverage here, representing roughly 1/3 of the overall project and over the key deposits that will be mined. But again, recently brought in by a strong operator in Orla and well advanced to supplement our revenue profile towards 2026 over the next few years. REN, I spoke to as a key cornerstone asset. Barrick has highlighted this as being incorporated into the mine plan in the short term. We had a team on site there a few weeks ago, and I'll let Ryan and Sam speak to their experience there later on. But we're really, really excited about this asset. High-grade near one of the largest mines in North America with great infrastructure and a great operating team there driving forward the deposit. Finally, the last Nevada asset to highlight here is our royalty over the Granite Creek mine. This is our most recent acquisition. We picked it up last fall. i80 Gold has continued to advance the deposit, outlined a high-grade zone at OG and expects to release an initial resource for the South Pacific zone and release updated mining studies in 2023. They're doing small-scale mining currently at Granite Creek, but they're ramping that up over the coming years, and we see this as an exciting component of growth given the high-grade nature of Granite Creek towards mid this decade in 2026 by our estimates. Beyond these assets that are really fueling the revenue profile that I'll show on the next slide, there's a couple of advanced exploration stage assets that we're really excited about, specifically Fenelon and Whistler. Fenelon located on the Detour Lake Mine trench in Quebec is a multimillion ounce relatively high-grade deposit over 3 grams per tonne and been extensively explored by Wallbridge Mining in the province. Given its jurisdiction, along trend with the largest gold mine in Canada and the appointment of the recent -- of the Chairman at Wallbridge, we could see this asset being traded into a larger vehicle. And is -- while we're not counting on it for our near-term cash flow, it's an asset that could provide that upside towards the end of this decade or in the early 2030s. Similarly, another significant deposit is our royalty of the Whistler project in Alaska, multimillion-ounce gold copper porphyry that recently completed an IPO through the U.S. Gold Mining Inc. vehicle. And that team is now fully funded to deliver a PEA over the next couple of years. So that provides a bit more granularity on what is driving our revenue profile, which I'll highlight on this slide. As we mentioned, building upon what Andrew highlighted is $6.5 million in total revenue and option proceeds in 2023. We see that large step change in 2024 to being well above our G&A costs in 2024. This is primarily driven by Côté, but also increased coverage at the Odyssey project, increased coverage at Borden and consistent option proceeds year-over-year. Beyond that, as I mentioned on the previous slide, with all those assets coming online and increased coverage at our key development assets, we'll see that revenue grow at roughly a 60% compound annual growth rate year-over-year out towards 2026. In 2027, we start to see that revenue take a step change as Odyssey becomes a fully underground operation and could see potential upside beyond what we're forecasting given the significant excess capacity they have at the Carlin complex as the operation shifts from open pit to underground. Given our flat cost structure, this revenue profile is -- has a linear relationship to our cash flow profile. You'll see cash flow increase year-over-year as this revenue profile materializes. And that will give us the latitude and the ability to reevaluate our dividend policy and potentially increase that dividend year-over-year. Beyond that, and before we take a break, Andrew and Alastair will be taking a deep dive into those assets that I mentioned earlier, giving an overview of some of the recent catalysts and some of the upcoming catalysts across those assets. But I'd also implore you to take a look at our asset handbook, recently published a few weeks ago available here for you. And it's a great source of information to dive in to the portfolio and get into the weeds. But with that...

If you mind, Peter, [indiscernible] we can take a break after that.

Sounds good. So with that, yes, I'll pass it over to Ryan.

Thanks, Peter. I'm Ryan Hass, the Operations Manager at Gold Royalty responsible for managing the portfolio as well as maintaining and growing our relationships with our operating partners. As Peter mentioned, the foundation of our company is really built upon 3 cornerstone assets, Canadian Malartic, specifically the Odyssey underground project, the Côté Gold project coming into production early next year, and the northern extension of the Goldstrike mine, the REN project, which we're looking to see enter production in 2025, 2026 and being fully ramped up. Starting with our most significant asset in the portfolio, the Odyssey underground project is included in the Canadian Malartic complex. The Canadian Malartic complex is located within the prolific Abitibi gold belt, it is one of the largest gold mines in Canada. Canadian Malartic is owned and operated by Agnico Eagle after their acquisition of the remaining 50% of the mine from Yamana in Q1. Our royalty covers the northern portion of the Odyssey project with significant coverage over the East Malartic deposits, the Odyssey North deposit and the recently exported Norrie zone, which is getting a lot of coverage. And to the south, we have exploration upside at Malartic South and the Midway project to the South and Southeast, but our key royalty is the 3% NSR UC, that's over the Odyssey shaft and covers those deposits that I mentioned earlier. The 2% NSR at Goldie and Charlie and the 15% NPI at Radium that you see in the top left to the west are more exploration upside and are not key drivers to our valuation of the 3% NSR. With regards to next steps and where we see this asset going? The 500,000 ounces per year in the initial mine plan has the potential to increase. They're ramping up production this past March at Odyssey South by Ramp access out towards 2027 where they plan to shift to a fully underground operation. But with that shift from open pit to underground, we see significant upside given the excess mill capacity at Canadian Malartic. As an open pit operation, Canadian Malartic is a 60,000 tonne per day operation. But as an underground operation, Agnico was envisioning a 19,000 tonne per day of throughput leaving 41,000 tonnes per day of excess mill capacity. One of the key areas of study for Agnico, given its recent acquisition of Yamana's Canadian assets is how to optimize the excess capacity at the Canadian Malartic complex. Given our significant resource coverage, we can see increased resource conversion beyond what is currently in the mine plan. So here are some of the upcoming catalysts and developments to note that will transition the operation from open pit to underground. We can expect updates to the mineral resource estimates and the mine plan. The current PEA only incorporates about half the underlying resources in the mine plan. So given half and half aren't included, it really illustrates the potential upside on our royalty. While not a significant revenue contributor to Gold Royalty now by 2027, Canadian Malartic is expected to be the highest revenue and cash flow contributor for gold royalty with modest production from the open pit and the underground ramping up to production. Moving on to our second cornerstone asset, the Côté Gold project. Côté is a multi-decade generational asset operated by IAMGOLD and is located in Ontario on the west side of the Abitibi gold belt that is rapidly advancing to becoming one of Canada's largest gold mines. This is an asset that is less than 12 months away from First Gold Pour, which is expected in the early half of 2024. IAMGOLD is fully funded to deliver that per production timeline. We have a 0.75% NSR over the southern portion of the Côté pit, which is the highest grade early part of the mine life that we have significant coverage. The current mine plan at Côté envisions 495,000 ounces per year for the first 6 years of the mine life, given the high-grade, near-surface mineralization with 365,000 ounces per year expected to be produced then after until 2041. I should note, given the extensive mine life, there is a great opportunity to expand and grow resources at Côté. Important to note, I mentioned earlier the high-grade, near-surface mineralization. And as you can see, this is where we have most of our royalty coverage. We have coverage over zones 5 and 7 in the Southern third portion of the Côté Pit, which represents actual high-grade and measure -- high-grade measured and indicated resources at Côté, as you can see on the image on the left. As such, we expect to see high attributable production from a royalty in the early years of the mine life, which results in a quicker payback on our initial investment and seeing this trail off towards the later years in the mine. IAMGOLD released their Q1 results last week, indicating they have completed 80% of production -- construction, up from 73% at Q4, displaying their continued development progress at site. IAMGOLD has also provided some updates and challenges they faced in the construction year, one of which has been increased CapEx and OpEx due to unforeseen factors such as inflation. But for us as royalty holders, this further illustrates the advantages of the royalty model in which we are insulated from cost overruns and by having our exposure to the top line revenue once the mine is in production. IAMGOLD has done a great job divesting longer-dated assets restructuring funding with Sumitomo and continue to stay on track to deliver first production in early 2024. As mentioned previously, this will be the biggest step change in our revenue profile in 2024. Again, a little more clarity on First Gold Pour. This timeline proposed by IAMGOLD, which is an experienced operator, have well advanced on the project and they have the advantage of having a strong team in place with sufficient funding. We're excited to see this asset producing within the next 12 months. We believe, certainly, Côté is an exciting deposit and is rapidly developing to becoming one of Canada's largest gold mines. Our third cornerstone asset, the REN project is the Northern underground extension of the Goldstrike mine that is currently in development for which we see coming online in the near term. The project is operated by Barrick and located along the Carlin Trend, which has historically produced over 70 million ounces of gold. We hold a 1.5% NSR and a 3.5% NPI over the project, which encompasses most of rent. Current resources at 1.6 million ounces, warranting roughly 7 grams per tonne material. Although Barrick has not come out with definitive guidance on when this asset is expected to enter production, they have indicated that it is being incorporated into the mine plan at the Carlin complex in the short term. Our team, including myself and Sam, were at site just a few weeks ago, I had a chance to see the underground operations and had productive discussions with the management team there and noted they're well on track with various mining studies across deposits. And therefore, we are bullish on this asset being incorporated into the overall Carlin complex in the future. I should note in Barrick's September Analyst Day, they outlined exploration upside of 2 million to 3.5 million ounces of resource further showcasing our royalty upside. From this and given the attractive grade in proximity to existing infrastructure, it makes sense for this deposit to be mined sooner rather than later. Speaking to that proximity, you can see some of the existing processing facilities from the Carlin complex, just south of REN. As you see in the image on the left, which is a planned view of the Carlin complex, we have coverage over significant mineralization at REN, the JV zone, the corona zone and the 24 Zone highlighted in red, all of which have had continued exploration success extending to the Northwest of the [indiscernible] underground operations. One of the recent updates at REN involving key catalysts and developments, Barrick is continuing to outline their exploration program in 2023 and continuing to complete mine studies. We're seeing quarter-over-quarter, Barrick continue to highlight this as the future of the Carlin complex, and we're bullish on seeing this asset enter production in the next few years with a production profile of about 150,000 to 200,000 ounces per year based on our estimates. Given our full coverage in 1.5% NSR, this could be another $6.5 million plus in revenue for us per year based on spot commodity prices. Beyond our 3 cornerstone assets, I want to highlight a couple of producing assets to give more clarity that the team is very excited about. First is the producing Borden Mine operated by Newmont in Ontario within the broader Porcupine complex. I should note Borden does not have much stand-alone disclosure as it is part of the larger Porcupine complex as reported by Newmont. With that, Borden is roughly a 100,000 ounce per year operation and is an interesting asset as it is the first fully electric mine in Ontario, which aligns with our ESG initiatives, as Katherine previously discussed. The current mine plan envisions Borden producing until 2027 with potential extension onwards with exploration of the complex. We hold a 0.5% NSR over the underground workings of the lake on the east side of the property as I'll highlight on the next slide. Current mining is primarily on land and will work its way to the Southeast under the lake where a royalty covers. Gordon has been producing since 2019, and our attributable coverage, as you can see in the mine working gives us exposure to those mine life extensions as they continue to explore at depth, extend along strike to the southeast and could see an extension increase in our attributable production past the current production rate. This is a royalty that came to us through Ely and one of the many development stage assets and smaller NSR royalties that are fueling our revenue growth. As mentioned, I wanted to highlight our significant royalty coverage over the lake area that you can see on the bottom right on the image on the left, for which the underground workings are expected to increase between now and 2027 with potential mine life extension further showcasing our upside to the current NSR. The final producing asset I wanted to highlight is the Jerritt Canyon Mine operated by First Majestic. Unfortunately, First Majestic has run into difficulties in mining profitably, but they continue to explore the asset to unlock value and double down on their investment made in 2021 from acquisition from Sprott. We hold 0.5% NSR and a per ton royalty over the asset, which is not a huge portion of our overall net asset value, less than 2%, but it is an asset that we would like to see producing again in the near term. First Majestic has outlined the suspension is temporary in nature and continue to explore the asset, delineate new deposits and looking for ways to mine in a profitable manner. They haven't come out with definitive guidance on when they can expect to restart. But conservatively, the Gold Royalty team could see restart come in 2025, 2026 after they've had a chance to optimize infrastructure and explore various deposits across the property. We've stripped out Jerritt Canyon from our guidance moving forward, although they did produce 16,000 ounces in Q1. The restart of Jerritt Canyon now represents an upside to Gold Royalty given we are now not counting on this asset in our forecasts. During the suspension, First Majestic will be processing approximately 45,000 tons of stockpile through the plant with exploration plans to explore for new regional discoveries and expand current reserves and resources, analyze the optimization of bulk mining and cost-effective mining methods and convert inferred and indicated resources into measured resources. First Majestic is planning to drill about 28,000 meters in 2023, focusing on large volume resource growth, further providing additional upside to our royalty. Overall, the Gold Royalty team is confident in First Majestic to leverage their underground experience from their Mexican operations to accomplish their goals of unlocking value at Jerritt Canyon. And now I'll pass it on to Alastair. Or we can take a break. I think we'll take a break. Yes. Thank you.

We'll entertain some questions and answers right now while we prepare for a short break and give people an opportunity to refill their coffee cups. But Peter, did you have some online questions, and we can go back to questions in the room. We can give them and you can ask questions before.

This one's a little louder. Yes, Dave, there is one question, and given we just ran through the asset updates, I'll hit it, and I think it will help some of the people in the room as well. And it's primarily over our coverage over a couple of those cornerstone assets, specifically Odyssey and Côté. And I'm happy to take this one. So Odyssey, with regards to the production figures that they're forecasting over the next few years up to full ramp-up. What Ryan quoted were the full production figures, we're expecting to have roughly 30% to 40% attributable coverage over Odyssey really over the next few years. And then as the asset is fully ramped up in 2027 and beyond. That's based on the underlying resources that we have at the project. We have approximately 5 million ounces of total resource of the total deposit there with the potential for that figure to grow given the significant expiration being conducted by Agnico at the deposit. So that gives you some fence posts with regards to how much production will be receiving from Odyssey. Similarly, with Côté over the entire life of mine, we're expecting roughly 1/4, 1/3, 25% to 30% of the attributable production coming from our royalty at Cote, albeit that portion is front-loaded given where our royalty is focused. The mineralization is focused at surface, the higher-grade portion where our royalty is located. And then our attributable production is expected to fall off towards the end of the mine life as the deposit dips to the north and off of our royalty coverage land. So this provides a bit more clarity on those 2 assets. And with REN, we have full coverage over the entire deposit. Beyond that, I'd open up to anyone in the room for Q&A.

Brad Conner.

Thank you. Just curious as to why we would introduce a DRIP with the stock trading at less than 50% of NAV? And can you tell me how many of the officers and directors management actually elected to reinvest versus taking cash?

As far as I know, all of the directors and officers, which collectively own about 4% of the stock participated in the DRIP. But beyond that, it was very, very nominally taken up. But again, the reason we introduced the DRIP is give shareholders a full optionality if they choose to reinvest their dividends, they have an opportunity to do that.

Question about the -- one of the initial slides in terms of the comparison of the NAVs of the different royalty companies. From my generalist understanding it's a bit of an art. Could you speak to your practices compared to other similar-sized companies? I noticed some of the analysts have different calculations for NAVs perhaps than yours. Can you give any color surrounding that slide?

Yes. I'll let Peter get into that in a bit more detail. But what I would say is those were based on consensus numbers. They're not internal numbers. So they are based on the analyst coverage universe, but Peter, please?

Yes, well, the gentlemen are in the room here as well. But it is -- we do have -- in just of 2 years of our existence. We have fairly widespread coverage, which I believe gives our consensus estimates a bit more robustness than some of the other smaller cap peers. But ultimately, we rely on consensus estimates to make it comparable to the universe. Ultimately, it's their estimates, but in my view, it's consistent across the board for comparable purposes and really is driven by the present value of the cash flows within our business and having that clear line of sight on those development stage assets. And while there's a range, having that 5, hopefully, soon to be 6 or 7 consensus estimates gives us that reliability.

But there is, I would say, some disparity in discount rates, depending on the analysts. Some analysts attribute more to our exploration potential than others. Some use different multiples. So there -- it's not entirely consistent across the universe. And I'm not really in a position to speak about their methodologies. I think they're actually quite robustly disclosed within the research reports. But it's not -- they don't always do it the same way across the board.

Or you use the comparable of the other company's assets? How do you [indiscernible]

Yes. So the question is how do we come up with the NAV for the other smaller cap. And you'll note that on that peer group slide, it is a select group of the smaller cap companies where we do have estimates that we can rely upon. Some of the sub-$100 million royalty companies, sub-$100 million market cap companies might have no research coverage in those instances, you're not seeing them on the chart. So it's really the data that we can rely upon, where we have independent discretionary research to point to as opposed to their own disclosed figures or paid for research.

With Jerritt Canyon, obviously shutting down and their punchline still as we're working on the contractor this might shut -- might ramp back up in the somewhat near future. Just wanted to see what you are doing with your internal valuation of the site and how exactly you've adjusted and what factors you based it on, given that there are very conflicting messages out in the marketplace with what's actually happening there?

I'm going to let Peter handle that. He does a lot of the modeling there. So please.

Yes. Heiko, good question. Really, with regards to us as a royalty company. We view this as a deferral. We've taken what we've modeled for the asset given the underlying resource there and conservatively push this up to 2026. We think in the lines of temporary suspension, a 3-year delay is a conservative estimate to see this asset come back into our revenue profile. With that said, First Majestic has outlined that they'll provide updated guidance this summer. I believe it's July. So we're really waiting on them to provide more clarity on their plans and their updated guidance for the asset as well. We have deferred it and our revenue guidance has completely stripped out Jerritt Canyon. So we are not expecting revenue from that asset for the next 3 years. If it comes in sooner than that, that is upside for us.

I'll just add, you will see in our quarterly disclosure as well we did do an impairment test. And we -- management with our auditors side, we did not impair the asset. Given that we delayed it, we deferred the cash flow in our models. It was not an indicator to impair that asset for the quarter. So it is a small portion of our NAV. We are still monitoring the situation. First Majestic has a temporary shutdown, and we'll monitor it quarter-over-quarter, but it didn't have as material an impact on our internal numbers to make a decision to do any impairment at this stage.