PT Vale Indonesia Tbk (INCO) Earnings Call Transcript & Summary

Dear ladies and gentlemen, welcome to PT Vale Indonesia Tbk conference call. At our customers' request, this conference will be recorded. [Operator Instructions] Now may I now hand you over to Mr. Nico Kanter, Chief Executive Officer, who will lead you through this call. Please go ahead, sir.

Thank you, Mr. Moderator. Good afternoon, ladies and gentlemen. This is Nico Kanter speaking, the President, Director of PT Vale Indonesia Tbk. I'm glad that I can discuss our third quarter of 2020 results with all of you today. Despite having to focus on anticipating possible impact of the COVID-19 on our operations, we were still able to achieve good results in this quarter. I and the other BOD members, with all the senior management of PT Vale, are joining from home. During this pandemic situation, we were still applied home office -- of PT Vale are joining from home. During this pandemic situation, we are all actually still applied the home office to all of our employees, contractor and schools. Please turn to the next page. This presentation and discussion will comprise assumptions and forward-looking statements that involve risk and uncertainty. In addition, our opinions and assumptions constitute our judgment and are subject to change without prior notice. Please refer to the following cautionary note and disclaimer. As you may see in the graph, our TRIFR, the total recordable injury frequency rate, and LWCFR, the lost work case frequency rate, had decreased significantly due to no lost time injury reported in our operations area during the third quarter '20 period. We recognize the need to continuously work harder to lower our injury rate, and we are committed to create a zero harm working environment for our employees as well as contractors, which in line with our company values, Life Matters Most. As you probably are aware, on October 7, 2020, PT Vale was informed that its shareholders, Vale Canada Limited and Sumitomo Metal Mining Co., Ltd. have completed the sale on transfer of an aggregate of 20% of their shareholding in PT Vale through the Indonesian Stock Exchange to the buyer nominated by the government of the Republic of Indonesia, PT Indonesia Asahan Aluminium (Persero) or INALUM. This further satisfy the divestment obligations under the Contract of Work amendment dated October 17, 2014, signed by PT Vale and the government of the Republic of Indonesia, which is called the CoW amendment. Based on the CoW amendment, the divestment process is one of the obligation -- divestment is one of the obligation [indiscernible] with the intention to expand its operations beyond 2025. Next, the production volume in third quarter 2020 was about 4% higher than the production volume realized in 2Q 2020, while the production in the first 9 months 2020 was 10% higher than the production in the first 9 months of 2019. Our operation in the third quarter of 2020 was more reliable despite the pandemic, resulting in higher production volume. We thank all the employees for their hard work to make this happen, and we are quite optimistic of meeting our 2020 full year production target of approximately 73,000 tonnes. Now please allow me to ask Bernardus Irmanto, our Chief Financial Officer to continue the presentation with our financial results. Anto, you have the floor.

Thank you, Pak Nico. So the group recorded sales of 19,954 metric tons with revenue of $210.6 million in this quarter, in the third quarter. While the price realized in the third quarter was 13% higher than the price realized into the second quarter 2020, the cost of revenue in third quarter 2020 only increased by 0.4% from the cost of revenue in second quarter of 2020. The group net earnings and EBITDA for the quarter were $23.5 million and $84.7 million, respectively. The higher EBITDA in the quarter was mainly driven by higher average realized nickel price. PT Vale dispersed approximately $34.8 million in capital expenditures this quarter, bringing year-to-date disbursement to $104.5 million. So next, you can see the graphs shows comparison between our average realized nickel price and unit cash cost of revenue. As you may see in the graph, our margin is wider in the third quarter due to higher average realized nickel price and at the same time, we were also able to manage our costs prudently. Next, the table shows comparison between third quarter 2020 and second quarter 2020 in terms of high sulfur fuel oil, diesel and coal consumption. As you can see, the consumption increased by 15%, 3% and also 7%, respectively, compared to the previous quarter; while price, at the same time, decreased by 7%, 28% and 6%, respectively. The increase in energy consumption was in line with the higher nickel mix production in third quarter 2020. Next slide, we talk about cost efficiency target. In early 2018, we launched a 2-year program cost reduction target. Since then, we implemented a series of initiatives to eliminate operational waste and also improve efficiencies. So as per now, we were able to realize cost saving of $21 million this quarter for the third -- until third quarter, out of target of $34 million set for the full year of 2020. So we're still executing several initiatives to achieve the target by the end of the year. In term of cash balance, the group's cash and cash equivalents as of September 30, 2020 were $361 million, an increase of $72 million from the balance at June 30, 2020. It was due mainly to higher collection from customer, in line with higher realized nickel price in third quarter of 2020 and coupled with lower fuel price. PT Vale will continue exercising clear control of its spending to preserve cash. Next, in term of the development project, the update -- for project development progress, we received AMDAL license for Pomalaa in January 2020. And now we are in the process of getting the forestry permit for Pomalaa. While for Bahodopi, we are still waiting for AMDAL and other license to be approved. We expect to have the final investment decision for the booked project with the partners by end of 2021. So basically, that's the end of presentation, I would probably hand over to the moderator for the question and answer.

[Operator Instructions] Our first question is from Eun Young Lee from DBS Bank.

Can you hear me?

Yes, we can hear you now.

Yes, yes. So I have 2 questions. Thanks for delivering strong results for the third quarter and then congratulations. My first question is about effective tax rate. I understand that you have a tax benefit in the first half. So I'm wondering what would be the effective tax rate for 2022, full year, and then 2021. And also, I want to ask about the schedule for upgrading work for blast furnace. So is there any changes for the schedule replacing blast furnace next year? And after replacing this blast furnace what will be your capacity expansion and then what is now your time line? That is my second question. Okay, that's it.

Okay. Thank you for the question. I have some big run analysis. So some of the question is probably not so clear. So -- and Young, if I understand your question correctly, the first question is related to the tax benefit; and the second question is related to the schedule to do or to execute the furnace rebuild, right?

Yes, yes. Right.

Yes. So on the tax benefit, as you know, as part of the COVID-19 incentives, government of Indonesia provided some of the tax incentive. So like right now, we're still using 25% CIT rate, and it will go down to about -- to 22% and further to 20% in 2020. We have actually in quarter 1 and quarter 2, when the announcement was made, we have actually revised our deferred tax liability at that time. And because the deferred tax liability will be decreasing tax rate is becoming lower, we booked some tax benefit in quarter 2, if you remember that. In quarter 3, basically, we had both tax expenses instead of tax benefit. However, due to -- like year-to-date, if you look at the numbers, still, it's very, very low tax benefit. And I believe in quarter 4, the number is already diluted. Meaning, that the tax expenses will be higher than the tax benefit. So again, we are in line with the incentive provided by the government of Indonesia. The deferred tax liability we have adjust back into quarter 1 and quarter 2, and we have booked the tax benefit in quarter 2, practically majority. And quarter 2, quarter 3, we actually booked tax expenses. But year-to-date, if you look at the number, it is still positive, but it's very minor number. So that's the answer for the first question. The question number 2, regarding the schedule for furnace rebuilds. So the schedule is still on. We will execute the furnace rebuild in May 2021 until probably early November 2021. That's why it will affect our production for that quarter, specifically for the second quarter and also early third quarter -- or third quarter and early fourth quarter. So hopefully, after executing the furnace rebuild, we can have more reliable furnace and also higher power supply to the -- for furnace, and then that will drive higher production. Probably not primarily in 2021, but in 2022, there will be some ramp-up period. But in 2022, we expect that all of the 4 furnace will be operating in a full power capacity.

So in case of 2022, with the full operation of your, the furnace, what will be now your production volume?

Yes. The production volume -- again, the production volume, I cannot disclose. But just to provide you with some context, right, so probably -- and also to correct, it is not blast furnace that -- you mentioned about blast furnace. The right one is the Electric Furnace #4. So the -- 2022, we expect the 4 Furnace is actually operating normally and also the availability and the utilization will also be high. The other factors that we need to consider to forecast or to project the production is also nickel ore grade from mining. So we are still developing like solid mine plan for 2021 and also for 2022. So depending on the sudden schedule, depending on the power availability and depending on the ore grade in 2022, then we can actually project the production. But just look at from the smelter point of view, then we'll be in a good situation in 2022. So we need to wait the ore grade, nickel grade in ore from mining in order to project the production.

Our next question is from Benyamin from UOB Kay Hian.

Nico and Bernardus, congratulation on your third Q results. I have some question. The first one is about the loss on disposal of fixed assets. I checked in third Q that Inco book loss on disposal of fixed assets, around $9 million. Can you [indiscernible] what kind of asset it is? And for the second question, is there any information for the production guidance for 2021? And third question, I checked the call purchasing price in third Q 2020. I checked that the price is higher than the call price in third Q 2019. Maybe can you share what is the -- why the call price is higher in 2020 compared with the contract in 2019? And the last question, can we expect higher salary costs due to furnace rebuild for 2021?

Okay. Thank you, Benjamin (sic) [ Benyamin ]. So just -- probably just -- can you repeat the fourth question? Like with higher salary versus cost?

Can we expect higher salary costs because of the furnace rebuilt in 2021?

Salary costs?

Yes.

Okay. Okay. So thank you, Benjamin (sic) [ Benyamin ]. So to answer your question, loss of -- cost of disposal of fixed asset. Yes, we booked around $10 million on fixed asset disposal. Basically, it is a part of regular process that we do in order to review the asset under construction. We're focusing -- and part of the internal control that we have in the company. So we review all of the assets under construction, particularly those who have -- which have been in place for a couple of months, more than 6 months, we reviewed thoroughly. And we actually have also [ asset-typing ] procedures, right, to ensure that the asset that we have in the company is still in use and also in still in a good shape. So some of the asset we found during the review is no longer usable. Some of them actually, the project could not be continued due to several reason. Like, just one example, one project called [ Ferry Tunnel ], we have to dispose the asset because we cannot continue the project due to several issues that we have in the company. So it is, again, it is part of the regular process in ensuring that all of the assets under construction is absolutely active one and in line with the plan. I understand that it seems bad because we eliminate or dispose the asset. But at the same time, it is part of the good governance process to ensure that our asset is actually all in use, all the regions are assessing use and all assets under construction is actually progressing as expected. So those that has been probably 6 months without any progress. We try to check and ensure that there are actually valid reason for postponing the project or for delaying the project. And if, for example, if the discussion actually concluded that, well, the project cannot be continued for different reasons, then we have to dispose the asset. The second one, production guideline for 2021, carefully, it is going to be lower than 2020 because of the shutdown. We are still in the budgeting phase right now. We cannot disclose as for now, like, the guideline for 2020 production target. Once we have the budget approved, we are going to disclose that to the market. But again, just to manage the expectation, it is definitely going to be lower than 2020 production. You can imagine that we will be operating for 5 months [indiscernible] right? So that's kind of update. On the coal price 2020 -- 2020, '19, I need to check. Basically, the price is the CFR price, and we are actually using 2 types of coal, the -- like for different purposes. We use high-calorie coal in order to be used for drying purposes. And in 2019, we're actually using low-calorie coal for [indiscernible] purposes. And the pricing for high-calorie compared to low-calorie definitely will be different. We need to check the proportion of high-calorie versus low-calorie in usage in 2020 compared to 2021. If I check your coal -- let me just check. Coal third quarter 2020 is $116. Actually, 2020, the price -- actually 2020 is lower than '19. So 9 months 2020, in terms of average price per metric ton in 2020 9 months is $101, $0.47 per ton at a CFR basis. And in 9 months 2019, it is actually $124 million. So it's actually lower.

Sorry, for the coal price in 9 month '20 compared with 9 month in 2019, '20 is lower. But in third Q 2020 versus third Q 2019 and for the third Q 2020, the price of the coal is higher.

Yes. Okay. Okay. Let me check on that. But on the 9-month basis, '19 is higher compared to 2020. Okay. So the last question is about salary costs. Yes. I mean we have a unique situation. So at the end of 2020, it was due to negotiate the union again on the benefit, including the salary. But we know as well that the company is -- not only PT Vale, but all of the industry is actually facing a significant challenge from the COVID. I understand that the result from the company is actually quite strong. But at the same time, we also have the requirement from projects. So I would say that there's a possibility to have increase in the employment cost, but it is not going to be a significant increase. I mean we are going to manage the cost combining with different initiatives. I mean we need to drive the productivity of the workforce. We need to combine with some strategy in term of using the third-party contractors and also reviewing some option that we have in order to get the resources. But on other hand, we also understand that there will be probably demand from union in order to increase the benefit. But overall, I still see that overall benefit increase, not only salary, would be in manageable level.

[Operator Instructions] Our next question is from Norman Choong from CLSA Indonesia.

Congrats on a very strong set of results. I have basically some two questions, but my first question is broken into two parts. It's regarding the furnace, right? I mean, I'm just wondering, now we are looking at a nickel price of 15,000 and very strong cash flow generation. Is there any chance that the furnace rebuild might be delayed again, say, because you are making so much money now? Or are you really looking at a lot of operational increase if you don't fix it, say, middle of next year? So that is my first question. The second part of my first question is, say, with the fixed furnace review. Can we assume some kind of cost saving in terms of cash costs, say, if we are looking at 6,500 a ton, 9 months this year, right, what kind of percentage will you be expecting in terms of lower cash costs on a like-for-like comparison? That's the second part of my first question. My second question is more big picture. It's more about Tesla, in part with Vale Canada, on the EV collaboration. So I am just wondering how do you see that discussion? And do you see Vale Indonesia really having a possibility to play a part in years? Or there will be purely Vale Canada will supply Tesla and it has nothing to do with Vale Indonesia? Yes, those are my 2 questions.

Thank you. Again, I mean, it's rather difficult for me to hear your first question. I'm hearing about the possibility to pay bonuses?

Yes. Sorry about -- my first question is any possibility to delay the furnace rebuild next year? Is because [indiscernible] is so high -- yes, because the nickel price now is so high and you're generating so much cash, what is your consideration of balancing that and operational risk?

Okay. So to answer that, I think the answer is no. I think safety and risk management is much more important than the production itself. As you remember, back in 2019, we had this Furnace #4 problem like we have running our furnace with very close measures in order to ensure the integrity of the furnaces. And we delayed the execution of the Furnace #4 rebuild from this year to next year. And we see no -- from the safety and risk point of view, we see no possibility of delaying the execution of Furnace #4 for more. It will be jeopardizing or putting our assets in -- significantly. So we will not delay more the Furnace #4 execution. We will still execute in May 2021. I understand that probably a lot of people are thinking about why don't we take opportunities of higher nickel price and produce more. But at the same time, we are actually want to position the company well when, in 2020, for example, as I mentioned before, the Furnace #4 can be operating in 75 megawatts, for example. Then we can actually capture more benefit in 2020. And we do believe that the longer-term price will be good for us. That's first question. Second question, you're questioning about -- recently, Tesla made some announcement.

Yes. Sorry, before that, there's a second part to my question, which is, say, if the furnace is fixed, what kind of degree of cost savings should we be expecting in terms of cash cost on a like-to-like comparison?

So if Furnace #4 is rebuilt, you mean?

Yes.

Yes, if Furnace #4 rebuilt, basically, we are producing more and with more volume, it will be diluting the cost, right? So we need to check again. I mean, in 2021 level, definitely, the cost will be different. But definitely, we will be producing more from Furnace #4 and total production will be higher, and it will be diluting the cost, right? Considering the nickel price of around 15,000, let me -- in terms of cash costs, we need to calculate again. And it's really pretty much dependent on other factors as well, like commodity price and all other things, right? So yes, it's a difficult question to answer basically. Yes.

Okay. Sure, sure. No problem. Yes. And the second question on Tesla and Vale?

And the second -- yes. I heard that Tesla is actually talking to Vale Canada Limited about some potential engagement. In Indonesia's part, the discussion is not happening. We are aware of that discussion. I think we need to carefully assess this announcement made by Tesla, right? So we know that Tesla is leading -- is in an urgent need for cheap nickel, basically, in order to intensify their battery production. Their battery production cost is still in the level that's probably not competitive yet in order to push the production of EV. That's why -- and right now, they are moving towards like probably aluminum thing or reducing cobalt and increasing the nickel content in the battery precursor. And nickel price right now is still too high for them. So when we heard about this announcement from Tesla, we need to carefully assess and also try to comprehend the announcement in 2 different perspective basically. One is from the commercial. When they can probably establish competition between players in the industrial miners, then they can probably expect more competitive price, lower nickel price or lower ore price. That's one. Secondly, as well, we know that we need to pay attention on the sustainability aspect. Supplying huge demand from Tesla will require a lot of thinking, a lot of regulation, a lot of discipline in terms of doing mining. And I know that Tesla, the guys behind Tesla, all of them are really concerned about environment, about sustainability. So they don't want to actually undermine the issue of sustainability and environment. And I just want to highlight that Vale Indonesia and Vale global, I think, we are putting ourselves in a very strategic advantage when it comes to good mining practice, sustainability. So short answer is that we don't have any idea yet about this business opportunity. I know that our parent company is actually talking with Tesla, but there's no material kind of discussion yet. In terms of Indonesia long-term plan, we don't have Tesla in our conversation yet. But when the opportunity comes, actually, I believe that the company is actually position ourselves well in terms of sustainability, in terms of good mining practices in some portfolio of projects in order to supply the battery -- EV battery market.

I see. I'm just curious -- the only thing I'm curious on is, say, if there's really a secure supply contract, would it be in the form of a new mine that has to be [indiscernible] a lot that would take years, so you can just [ shoot strong ] and supply somewhere. That is the only thing that I'm curious on.

Can you come back again? Sorry, again, I mean, my connection is probably not very good.

Yes, yes. Sorry. My follow-up question on that is, say, if there's really some form of collaboration based on the understanding, would it be in the form of new mine development to supply that? Or do you think Vale can just find supply from the existing operation and just supply to them?

Yes. Just from -- purely from business perspective, the value of ore is not matching the mining. The value of ore is in the processing, right? For a company like Vale, we really, really want to monetize our resources to the optimum level, right? So yes, if you talk about possibilities, mining, supplying ore is one thing, but supplying ore alone will not actually bring us a lot of values, right? So in order to get values from our ore, we need to tap into the processing. I think the -- if you just can imagine the value of processed ore compared to the value of raw ore is so much different, right? So again, I mean, it's just a concept, we don't know yet. Like even if you talk about the smelter or refinery in order to process the EV market, we need to talk about technology use, we need to talk about the investment and all other things. And as you know, that we have a very, very busy investment agenda for the next 3, 4 years. So it's going to be very challenging. Unless the economic of the proposed collaboration or proposed partnership is really, really, really good, then it's going to be a different conversation.

Our next question is from Aryo from Bahana Securities.

Okay. Congratulations for your results. And I have two questions. First one is, if I'm not mistaken, you postponed the furnace rebuild because of the COVID-19 pandemic, right?

Correct.

Correct. Yes. Okay. So -- but if, for example, the pandemic has not been contained by, at least by, let's say, first Q 2021 or second Q 2021, will you still continue the plan to rebuild the furnace? That's my first question. And my second question is you also said that you have the tax benefit because of the government incentives. Will you expect the tax benefit will sustain in 4Q 2022 and also in 2021? And will this amount of tax benefit will be occur again in 2022 when the tax rate decreased to 20%?

Okay. Thank you, pak. So your question is -- first question is related to the Furnace #4 rebuild. You're right that we are deciding to postpone the Furnace #4 rebuild due to the COVID. As you know, that it is going to be massive work. We need to have a lot of people in the processing plant. We need to have asphalt resources to come in. We need to have all the materials ready by the time we execute the project, right? So I think all of the materials will be ready. The challenging part will be probably to rearrange the people in order to work with social distancing if the level of pandemic is still as it is today. That would be the challenge, right? But I think it is going to be manageable given that we have still time in order to execute that. We have a solid plan now. Our ESS department, our project department are developing a plan in order to execute the project independently, like doing all the screening, the rapid test, how to execute the project without violating some of the protocol that we have. So I think we are in a good position to mention, and I'm confident to say that we will no longer delay the Furnace #4 rebuild. I think the Furnace #4 rebuild is very critical for us from different reasons. One is, as I mentioned, it's difficult to execute the Furnace #4 rebuild in May. And at the same time, also, like we need to capture the opportunity. We need to be able to execute or operate full -- in a full kind of mode by 2020. And in last month, actually, in October, we actually -- we did Furnace #4 floor repair, right? So it is certainly a much smaller scale project, but it is tested -- it was tested in the field. We can raise the employees so that they can respect the protocol. We can screen the employee who will work in the field. And it was executed without any major issues. And like there's no issues as well in terms of COVID-19 kind of infection during the execution of the project. So we have a high level of confidence that we can actually execute a bigger project, learning from the experience that we have recently. Your second question is regarding tax benefit. Yes, as I mentioned before, in term of tax expenses, the real tax expenses, definitely, it will be lower to 20% in 2022. I explained before, when we actually receive the announcement about decreasing of the IT rate to 22% in 2021 to 20% in 2022, we actually [ baked the uplift of the new tax liability ]. So the new deferred tax liability is lower because of the lower CIT rate, right? And because of the lower deferred tax liability, then we booked tax benefit in quarter 2 and quarter 1. So all of the tax benefit because of the lower CIT rate has been booked when we actually received that news by discounting the deferred tax liability.

Okay. Okay. But I have a follow-up question with -- regarding the rebuild -- furnace rebuild. Is the new normal or implementing health protocol causing the cost of furnace rebuild increase? Because I don't know, without the pandemic, maybe you can gather a lot of people and do it together. But in the new normal, you cannot gather all people together. So you need to split them up and give a test. Will that increase the cost significantly?

Not significantly. I think, yes, you're right. For example, we need to do screening, we need to do rapid tests, we need to probably arrange the transportation differently. But I don't believe it will cause significant increase in the capital project.

Our next question is from Anthony Angkawijaya from Macquarie.

So my question is related to your development projects at Bahodopi and Pomalaa. If you could please share what processes aside from acquiring permits will be completed from now until 2021 as you finalize the commercial negotiations? And secondly, what's the time line of development, assuming the projects are approved nearing the end of 2021?

Thank you, Anthony. For the different projects, both in Pomalaa and Bahodopi, as you know, there are 2 different kind of parts going on right now. And both parts actually in order to certify the FID requirement, right? First is -- actually, it's not 2, it's 3. First is the technical part; second is the commercial part; and third is the financial part. In order to approve the FID, at least, for example, on the chemical side, as you mentioned, all of the permitting, all of the bankable feasibility study, both for the mining and processing plant, must be completed, must be finished. From the commercial point of view, all of the key agreement must be in an agreeable format, right? So we are talking about shareholder agreement. We are talking about like our supply agreement, offtake agreement, technology agreement. So all of them must be concluded absolutely in a high level so that it is executable by the time of FID. And the third is about the financing itself. As you know, it will be going to be project financing. So the [indiscernible], we are establishing [indiscernible] and the [indiscernible] must raise project financing in order to fund the project. At this point of time, all of the fund is actually going on. I mentioned before that for Pomalaa, we are waiting for the -- we are waiting for the [indiscernible] forestry permit to be -- it's -- actually we obtained that already, but we need to also revise the AMDAL. We need to also conclude the [ FS work from AMDAL ]. So the technical front is progressing. Yes, I mean, there are a couple of challenges when it comes to permitting, but we are working closely with the government, especially with the [indiscernible] in order to pursue the -- or push the permitting so that we can get all of the key permit -- at least not all of the permit, but the key permit in order to take the FID. On the commercial agreement, I think, on the Pomalaa, we are well ahead. I mean, we're almost conclude all of the key commercial pre-term sheet for the project. I think we know our partner well, Sumitomo. So that's why in our discussion, it's much more conducive. There's a positive atmosphere in the discussion, there's trust. So it's also progressing. Under financing, I think we are waiting all of the chemical aspects to be concluded, especially on the mining feasibility study before we can talk to the bank. The treatment CapEx has been established. The financing terms, that's been deferred. So we just need to wait all of the key elements to be concluded before we talk to the bank. On the Bahodopi side, as you know, we are engaging a Chinese partner. And like the discussion about commercial, I think it's more challenging compared to the Pomalaa one because we have never had experience working with Chinese. So we need to align a lot of things, a lot of interest, a lot of understanding about technical measures. But it is also progressing, although probably slower compared to the Pomalaa project. So in terms of permitting, we are also pushing the permit for Bahodopi project. And hopefully, we can get all of the key elements for the 2 projects by the time, by 2021. Right now, we are talking about probably quarter 2, quarter 3 or quarter 4, just late 2021, just considering all of the progress that we are seeing today. In terms of construction time line, the Pomalaa project will take a longer time compared to the Bahodopi project. It's probably it's much more complex project. It is considered as new. We're lucky that Sumitomo is our partner. Sumitomo is the only reliable contractors and also operators for HPAL plan, as we know. And even so, they will need probably 5 years to construct the project. The Bahodopi project is another technology. We are going to use Chinese [indiscernible] [ as per noise ], as per discussion today. It will be probably much, much quicker compared to the Pomalaa one. Probably to expect 2.5 to 2.0 years is probably reasonable for the Bahodopi project. So if you're talking about the time line, if everything goes well by 2021, we will probably having in late 2023 or probably 2024 for Bahodopi. For Pomalaa, is longer than that.

Got it. Just one follow-up question then. You mentioned the potential completion of the plant construction. Do you have any figure for the total CapEx that -- your latest figure, you have it ready?

Yes. I think the bankable feasibility study need to be completed right now. But as we announced before, Pomalaa project will require much higher capital. As you know, there are probably $2.5 billion. That is what we are -- we talked a couple of months ago. The number can change considering different factors in the discussion. And for -- about the 2 projects we are talking about, yes, and it has been -- it has been announced sometime in the past, in the order of USD 1.5 billion.

As there are no further questions, I will hand the session over to you, Mr. Kanter, for closing statements. Please go ahead, sir.

Okay. I just would like to close this by thanking everyone for participating in our call this afternoon, and thank you for all the support. And we hope to see you again in the next quarter. Thank you, Mr. Moderator.

Thank you. Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.