Sandfire Resources Limited (SFR) Earnings Call Transcript & Summary

Hello, everyone. My name is David Wilson. I'm Head of Commercial at Sandfire. I'm really excited to welcome you all here today to our strategy briefing -- our exploration strategy briefing, which is aligned to our strategic pillar, increase our reserves. And the reason I'm excited is when I joined Sandfire 4 years ago, what I found was a company that had really deep passion and really deep technical expertise, particularly in geoscience. And part of what we're going to do today is give an update on our strategy, but what I'm excited about is we're going to show you a little bit of that technical expertise and passion in some of our team who's joining us here today. As always, please make sure you take note of the important disclaimer. In Sandfire, I would acknowledge the traditional custodians on the land in which we meet today, the Gadigal people of the Eora Nation as well as First Nations People in the lands where we conduct our business right around the globe. We pay our respect to their elders past, present and emerging. Moving on to today's agenda. Brendan Harris, our CEO, will start with a brief business and strategy update; and then I'll hand over to Richard Holmes, our Chief Development Officer; and some members of our exploration and geology teams to discuss our exploration strategy and how we're applying that across the business. At the end, there will be an opportunity to ask questions, both for those people in the room and for those people on the webcast. [Operator Instructions] For those joining in person, you're also most welcome to join us for light lunch following the presentation where the team will be available to discuss a little bit more the exciting work that they're doing. And then just before I hand over to Brendan, we get on with it, so to acknowledge, we have John Richards, our Chair, has joined us in the room. The guidance and support we get from both John and also the Board is truly invaluable and something we all appreciate. So over to you, Brendan.

Thanks, Dave, and good morning to those of us here with us today, and obviously, those online. Before I start, I'd also like to acknowledge the traditional owners of the lands on which we meet today and where we conduct our broader business. I also pay my respects to their elders, past, present and emerging. And thirdly, can I pass on Jason's apologies. He'd love to be here with us today. But unfortunately, we had an offsite with our broader leadership group last week, and a number of them came down with COVID of which he was one. So he's currently at home resting, which is where he should be. Perhaps unsurprisingly, we've received a great deal of interest in our exploration strategy. And indeed, this may reflect the general level of experience Australian investors have in the Iberian Pyrite Belt and Kalahari Copper Belt more broadly. And possibly also the level of experience people have with sedimentary copper itself. So we're doing something a little different today. And I must say, I'm excited that you'll have the opportunity to meet with key members of our talented team of geoscientists. I know they're looking forward to helping you understand how we're unlocking the secrets of both of our key provinces. We're convinced they have an important role to play if the industry is to meet the needs of a global community that must and is electrifying. With this in mind, I'll be brief so we can get to the core focus of today's presentation. So to the key messages. We own and operate the most modern processing facilities in the Kalahari copper and Iberian Pyrite Belt. These facilities provide us with a distinct strategic advantage in both provinces. Our highly experienced team are motivated. They have unrivaled geological knowledge of these belts, having undertaken the critical belt scale assessments that our large landholding allows while benefiting from our operating presence at the micro level. This isn't common for a company of our size. And so we're now moving into what I call the discovery phase of exploration. As I like to say, ultimately, ore bodies aren't discovered in the office. And we're united in our commitment to increase our reserve life at MATSA and Motheo to a minimum 15 years. This, after all, is the most capital-efficient lever we have to create tangible value for our shareholders and represents the generic threshold for what we have defined as a long-life asset. And to frame the broader discussion today, I bring you back to the Sandfire Way and one of the most important images we have in our organization. The Sandfire Way is intentionally simple. And it's what 99% of our people are focused on each and every day. The Sandfire Way connects our purpose, strategy and way of working while emphasizing the behaviors that will make us successful. Of course, it also highlights exploration and our efforts to increase our reserves as one of our 4 strategic pillars. And we're proud of our exploration and mining heritage and have chosen to embrace the unique cultures of our growing global footprint. I know Richard and the broader team are looking forward to discussing our dominant landholding in both Spain and Botswana that covers some 3,000 and 16,000 square kilometers, respectively. Let's make no mistake, this is an enormous landholding. And I also know many of you have just returned from South America. And I really encourage you to visit us at MATSA and Motheo when you can, as we believe both locations, while not the largest producers, are becoming increasingly competitive. And of course, the food definitely stacks up relative to South America. Before moving on, I'd also like to note our relatively low total recordable injury frequency of 1.6 in FY '24. As you would expect, our job won't be done until all injuries are eradicated from our business. Richard will touch on our safety performance and exploration specifically. We all know that a strong balance sheet is a key enabler of a cohesive and consistent strategy in our industry, given the need to weather inevitable volatility. Here, you can see we've scaled the peak of our net debt profile and have transitioned squarely into de-gearing mode as we move back toward a net cash position. This growing financial flexibility and the step change in our geological knowledge is what has given us the confidence to ramp up our level of exploration activity with a more than 75% increase in our rate of spend expected this year. And importantly, this also reflects a primary focus on drilling, the litmus test of any discovery. Before I hand over to Richard and the team and recognizing we're now in early December, I thought it may help if we were to provide just a brief high-level operating update. First and foremost, we remain on track to achieve copper equivalent production guidance for FY '25, with both MATSA and Motheo expected to approach or hit a circa 50% run rate at the end of half 1. At MATSA, this is likely to include an increase in contained zinc and decline in contained copper and concentrate production in Q2 as planned and as we have discussed previously. From a cost perspective, we're also tracking relatively well with recent weakness in the euro, providing some relief at MATSA recognizing that around 90% of our costs are euro denominated. I'd also like to note that our exploration and the valuation expense at Motheo will be weighted to the second half as we establish a drilling presence in the south of the Kalahari Copper Belt. While sustaining a strategic expenditure at Motheo will also be weighted to the back end of the year as we ramp up our efforts to better define the opportunity at A1. And lastly, I should again note that Sandfire America is likely to seek an additional funding commitment in Q3 FY '25 should the project tollgate into its final feasibility study phase. This additional investment would be spent across both FY '26 and FY '25 and would represent a milestone related increase in guidance. With that, I'll hand over to Richard and the team. I hope you enjoy the presentation. For those of you in Sydney, the interactive luncheon that will follow. Thank you.

Thank you, Brendan. It's not often that mining and exploration geologists get let out to talk in these sort of forums. But we are really excited to come here and tell you about our story. So I'll start with me. So I'm Richard Holmes. I'm Chief Development Officer. I've been with Sandfire for about 3 years now. I've been in the industry for probably too long, over 25 years. I've done a bunch of exploration and BD roles for global base metal companies and global gold companies. So I'm really enjoying my journey at Sandfire, and I truly believe that we've got some of the best prospectivity on the planet. This is the thing here today. So maybe I'll hand over to individuals here and they can introduce themselves. And let you know what the depth of our team is and the amount of experience we have. We'll start with John Lauderdale.

Good morning, everybody. My role is -- My name is John Lauderdale, my role in Sandfire is to head up the exploration in Botswana. I've lived and worked in Central and Southern Africa for just over 40 years now doing exploration and exploration-like activities. A large portion of that has been spent up in the Central African copper belt. I was the first exploration manager for the company that morphed into the Ivanhoe Group. I was responsible for pegging all the grounds in [ Zaiyer ] as it was then, which subsequently we've made the discoveries of Kamoa and Kakula. I've been with Sandfire for just over 2 -- about 2.5 years now. And the reason I came across was won the attitude of the company, where exploration was considered to be a very high part of the profile. And also to move into an area which is very underexplored, which we'll touch on later on in the presentation.

Thank you.

I'll try and be brief. Pleasure to be here. My name is Jim Royall, and I lead in the regional exploration in Iberia, Spain and Portugal. I'm a geologist. I've been working in exploration for somewhere over 25 years now. A lot of that time has been set where -- has spent in the belt. I was with Las Cruces -- in Rio Tinto when we discovered Las Cruces, and I was also working with the team that discovered [ Castillaito ]. I love the area. Really pleased to be there -- to be here to sort of run through some of the stuff we've been working on. And I was saying to John yesterday, this is my second time in Sydney. The first time I came here. I was 18 years old, and I was embarking on a year, hitch hiking around Australia. And we were down there last night. And as I look at the older me looking back at the younger me, I just don't know how I survived.

Good morning, everyone. Thanks for coming today. My name is Scott Thomas, I'm the geology manager of MATSA. I think I've met a few of you on some of your visits previously. I've got 15 years of experience in the industry, not as much as some of my seasoned colleagues here, across different commodities, different jurisdictions, different mining methodologies. I joined the company 6.5 years ago as the geology manager at DeGrussa, our deposit in Western Australia before moving over to Black Butte and working as the project development manager there in the U.S. And during the acquisition phase of MATSA transition across with the integration team, and was on ground February 1, 2022, when we took ownership of the asset.

Good morning, everyone. My name is Peter Willems. I've been with Sandfire for just over 7 years through -- started off in mining across exploration and the last couple of years in the technical team. I've been in the mining industry for just over 10 years, and in my spare time, I run the Mineralogical Society of Western Australia and the Perth Gem & Mineral Show. I also run a small scale copper mine in the Northern Territory for mineral specimens. So minerals run through my veins and are very excited to work on the Sandfire projects and present to you today on what we have to share.

Great. Thanks, everybody. I'll touch on safety first. As Brendan mentioned, the exploration group is going TRIF of 2.8, which is higher than our company average, and we need to strive to lower this. That is too high. But I want to put that in context, we have a relatively small group around the world, and we have relatively low work hours. So that 2.8 represents 1 incident in 12 months, which that part we're very proud of. But the incident itself was probably as far removed from exploration you can get. You can imagine what we do. We're in the bush doing geophysics. We're drilling. We're in remote locations. What happened? We had someone who cut their hand in the exploration camp [ kitchen ] while moving some equipment. So we've just got to be vigilant. We've got to think that was a nonstandard work. We've got to think every single time, what are we doing, why we're doing it, doing the risk assessments. So it's really important that we remain vigilant. So we'll strive to lower that. And as of today, our TRIF is 0 because that incident was just over 12 months ago. We will continue, we will push harder and we will keep it there. But now on to the 2 strategic hubs. Our 2 processing facilities are located in provinces that we selected for their prospectivity and the type of mineral deposits. This was an accident. These were deliberate decisions to move into VMS mineralization, which we were very comfortable with already, and of course, sediment-hosted copper. In Botswana, we hold 16,800 square kilometers of exploration tenure around the Motheo processing plant, our new low-cost, simple open pit mining operation. Pete and John will talk about this project more later. In the Iberian Pyrite Belt, our modern processing plant at MATSA is currently the only facility that can process both copper and zinc, both of which we're big producers of. Jim will talk about the history and the endowment of the belt. And that will lead into a discussion of how many opportunities are in that part of the world, not only from an exploration point of view. There are numerous stranded deposits within the side of the head frame. Some of them are too small to support their own processing infrastructure. Some of them are in private hands and lack the capital to develop. We're working hard to unlock some of these opportunities. So we can add further optionality in this belt and push the lifespan of MATSA even further than what we think is there already. So taking you to the Kalahari Copper Belt. This is the Kalahari as defined by the U.S. Geological Survey. It's over 1,000 kilometers long, stretches from Namibia maybe all the way into Botswana, up towards the Okavango Delta. And already, it's got resources of more than 8 million tonnes of contained metal. And that's in a relatively short time period for exploration. This country -- this part of the belt has only really seen exploration for maybe 15 or 20 years unlike many of the places around the world. But we think this is a great country to operate in. So you can see here, this is our landholding. But more importantly, we've got bitumen roads that run around the whole country, connecting the major population centers. So we can efficiently move our concentrate certainly through Botswana, Namibia and into the coast. We got access to grid power, which runs not that far from the roadway. It really does reinforce that while this is Africa, this is a country that's different. We really enjoy working here. We think there are lots and lots of advantages. Our ground holding spans more than 200 kilometers in length. And now let's put that in context. I suspect many of you have been wandering around South America recently looking at large copper projects. So that distance, our landholding is longer than the distance for Antofagasta to Escondida. So think about that. But I think more importantly, think about the change of elevation, 200 kilometers. I think the elevation changes by several meters, not several thousand meters. But seriously, this brings many advantages from logistics, access to drill sites. We're not building platforms. We're not helicopter in rigs. And then when we do find something, and I'm sure we will find something, infrastructure layouts are relatively simple and straightforward and cost efficient. So I think operating here is just -- yes, it's an amazing advantage. And look, finally, this is a big basin and a big basin requires a big approach. So this is the coverage of the AGG survey that we flew 18 months ago. One of the really pleasing things that we partnered with lots of our neighbors. So from the junior ASX companies to what was private equity, and we collaborated together, so we could fly the bulk of the basin here. And that's really important because we're not doing postage stamp exploration. We need to look at the big picture. We need to find out what the basin looks like, what the structures look like, how they're feeding and creating these deposits. So an amazing experience. It's not often as a geologist, you get to collect data like this. And this was the biggest airborne survey that Botswana had ever seen. And look, to put this in context, if you're familiar with things like the Australian geological surveys or the state geological surveys, this is akin to the level of pre-competitive data that governments fly. So we're really, really pleased with the work that's gone into this and the secrets that is beginning to unlock. In a world where -- most people have fragmented ground positions or postage stamps. This is a unique position, and this is a real competitive advantage. So VMS, why. Volcanic massive -- volcanogenic massive sulfides or ancient black smokers. Well, this is why this photo here. This is why we love VMS'. This was taken at Magdalena in Spain, and this contains very high concentrations of chalcopyrite, galena and sphalerite. Or if we've got mining engineers watching, that's copper, lead and zinc. We could talk for hours about this photo, and believe me, some of these gentlemen here would, as we did not so long ago, about the sulfide banding, about the chemical sediments that are present. Or why we think the genesis of this is so interesting and how something as simple as this can help us unlock the exploration secrets. But also, it's about value. And that face is probably 4% or 5% copper equivalent, maybe a bit higher. That's an NSR of $300, $400 per tonne. That's why we love VMS deposits. VMS deposits with their high NSR values. They are so different to that other company, I didn't mention when you've all been around looking at their projects and looking at porphyries. This is as far removed as you can get. As the porphyries get older and deeper and the grades decline and their lack of cost -- their lack of byproducts move them up the cost curve, our VMS deposits, they benefit from a basket of commodities. That means we can remain competitive throughout the whole cycle. So when costs are going up and everybody is moving to the right, we're sitting below those people. It's a very strange industry where usually economies of scale drive you to the bottom. But as we've seen that porphyries are getting older, their capital is increasing. They've been driven to higher parts of the cost curve. Our goal, let's stay below those guys. What about scale? Well, we think big is not always better. With a low surface footprint, relatively simple infrastructure, this can seriously shorten permitting time lines, development time lines, even the drilling out of the deposit is going to take less time. So everything points to speed. And in a world where the average time now to take a deposit into production is 17 years, what have we done? Well, Magdalena discovered, drilled out production 3 years. DeGrussa, everybody knows that story. And finally, looking for great big chunks of metal or the technical term, massive sulfide. It has its advantages. It's dense. It responds really well to modern geophysical techniques, which we're applying across the belt. A lot of these for the first time. The search spaces are looking getting a little bit deeper. Jim will talk to how long the Iberian Pyrite Belt has been mined, and a lot of the surface deposits have been found. So we're stepping deeper and deeper, which is great in one way because we're going to mine underground and not impact on the surface. The footprint will be smaller. Our technology is getting better. We understand how to use gravity, EM. We've got lessons from DeGrussa. We wrap all that together, and we think we've got a real advantage in the pyrite belt. Our other deposit type, sediment-hosted copper, it's really different, really different. One of the biggest challenges with sediment-hosted copper is not actually finding copper. One of the challenges is actually finding economic concentrations because there's copper everywhere. So these large basins tend to have a basal unit that's got lots of low-grade copper. We have that in Botswana, the NPF, the [ Nowakaban ] formation. That generally goes 0.2%, 0.3% copper, sometimes 0.4%, lots and lots of smoke. But really, we need to find the economic accumulations, how we can boost that grade from 0.2%, 0.3% up towards 1%, which is why we had to go back to basics. The same processes that forms sediment-hosted copper form hydrocarbons. So we've lent a lot on the oil and gas industry, technology, consultants. It's an unusual approach for a company. Normally, we're all so focused on hard rock in our ground, and this is what we do. But if you open your mind and you deal with other industries and take their lessons, we believe that brings a really, really good advantage. So the techniques we use really could sit for oil and gas exploration. We build big basin models. There's no point building 2 square ks of a geological model because you don't understand what the context is. You need to build the basin. Our basin is 200 kilometers long. We spent a lot of money and a lot of time collecting all this data, but we've built the models. You need to understand the sedimentary environment. That's a very, very different approach from normal exploration geology. Most people when they last looked at a sediment hosted or a sedimentary unit, it's probably at university unless you're in oil and gas. So we lean on the expertise there. And finally, we use seismic. Seismic has been really good for us. It helps us build those big 3D structural models, understand the plumbing of the basin, trying to find the structures that tap the NPF that can drive those fluids into new locations and concentrate them and form deposits. It's all about trying to find the best place to be. Because when we do discover them, they're fantastic deposits. They're simple, clean metallurgy. That means processing is really very simple. And they produce great concentrates. Byproducts, usually have a byproduct helps with the economics. Our search space is relatively shallow. We're in the Kalahari. There's a veneer of sand we're looking near surface. So we're not looking for underground targets. So we're looking for relatively shallow deposits that are amenable to open pits, which bring operating cost, capital advantages. And when you find them, you can build them relatively quickly. You look at Motheo, what a deposit, T3, A4, A1. These are low-cost, $1.50 a pound. The metallurgy is fantastic. It is flying through the process plant. Pete and John are going to take you through our journey in the Kalahari, and we're very excited about leveraging what is already almost sunk infrastructure. We got the plant up and running. So the best way for us to add value is to push out the life of Motheo, find more satellite deposits. And then we'll add significant value. And hopefully, there's always the chance that we find a new stand-alone deposit to create Motheo Mark 2. We are very excited about the Kalahari. This is a very simple slide, but while there's so much work gone on in this, it's taken a -- it really has taken us 2 years to get to the point where we are and to build the foundations. And we'll use that phrase ore body knowledge or the step change in ore body knowledge pretty loosely. And sometimes, I think we have to step back and just look at the sheer amount of work and the sheer amount of brainpower that's been put into this. To be honest, it's taken a little bit longer than we expected. And there's a few reasons for that. If you look at MATSA, the scale of the work involved there is directly proportional to the scale of the opportunity. So we had to reorganize all the data. We had to relog all the core, and my gosh, there's a lot of core. We had to build fit-for-purpose geological models because when we arrived, and Scott will take you through this, the geological model was very, very simple. So we needed to build lithological models, structural models, mineralization models, put them all together to give you a much better view of the ore body. That's led to the things that was still Scott's standard, but the things that he'll talk about. And it also has a knock-on effect. It has impacts on mining. It has impacts on processing. We're seeing benefits across the board from that basic geological work that we saw in due diligence that we thought here's the opportunity. This is what we need to grab. In Botswana, a country without sea, who thought importing AGG technology, which was our airborne gravity gradiometry system which is actually used to detect submarines was going to be so difficult. It took us so long to do. It was very complicated, but we got there. a lot slower than I would like, a lot slower definitely than Brendan would like, but we got there in the end. We've built the model. We're very, very comfortable with our results. So now really, we're beyond the desktop. We've done all the foundations. We've built and improved and we've got fantastic ore body knowledge, but now is the time for execution. And we're actively drilling across the portfolio, and we're in discovery phase. And we're ready to learn and refine and when we discover the big one, we'll learn and refine, and then we'll go again. So now it's time to hand over to Pete, and this is where the rubber hits the road. I won't go through this slide in that much detail because I don't want to steal the team's thunder. But we'll show you what I've been talking about, we'll show you how we've unlocked the structural secrets, how we're applying it. We've got an extensive drill program this year, and we've got some really great milestones to look forward. So I'll now hand over to Pete and John, who will take you through their journey, give you some of the details of the secrets that we've unlocked. Pete?

Thank you, Richard. It's great to hear the reinforcement of our position nice and low on the cost curve. I'd like to take you now on a journey of how we have stepped up the learning curve of the ore body knowledge. So as we zoom into the Motheo hub, you can see our flagship T3 down the center at the bottom of the screen. A4 is in ramp-up phase at the moment, 7 kilometers to the West Northwest. And A1, 20 kilometers to the Northeast, which is currently our advanced project. I'll touch on all of these in sequence. So as we zoom in on T3, you can see here the life of mine pit expected for T3, behind that, the waste dump and the tailing storage facility. Down here, we've got the ROM pad, the processing facility and the administrative buildings, just to give you a sense of scale for the operations. Before sharing our exciting outlook of future discovery in the KCB, it's important first to look back for the context, starting in 2020. The world was battling COVID-19, and we thought we had the geology of T3 all figured out. It sits within a folded sequence of sedimentary rocks, siliciclastic and carbonate rocks at the [ car ] formation that overlay a relatively oxidized package of sandstones in the footwall, that rock a pan formation. These sit type at top of [ paraclineandicline ] or dome, the T3 dome and it was interpreted to have been breached by a sequence of thrust faults, which you can see here represented by the red lines, MDPs, 1 through 7. Mineralization was identified to be structurally controlled and it was interpreted to have been hosted within the thrust package itself. For the most part, the model held together very well through infill drilling, but there was a particularly enigmatic hole, MOG65D, and I'm sure a lot of you have heard this hole being talked about in the past and never quite fit the model. When we took the lid off the deposit in 2022 through the mining of Stage 1, it became very clear that what we were looking at was not a sequence of brittle offset thrust faults, but isoclinal folds that wrapped around the top of the deposit, not what we were expecting. There were 3 major shortcomings for the ore body knowledge at T3. The first is something that we've all heard before. There simply weren't enough holes drilled in the footwall of the deposit. The second was a simplistic suite of elements in the drill hole database combined with monotonous repetitive lithological units, it was very hard to see the wood from the trees in the drill hole data. And most importantly, there was no oriented drill core done early on in the deposit and no structural measurements. Several campaigns of pit wall mapping were undertaken at T3 to try and get to the bottom of our model discrepancy. We also purchased comprehensive suite of geochemical data from the labs from the existing drilling set. We were able to then document a lithogeochemical framework for the T3 geology and build a more robust litho-stratigraphic model. This updated rock model was then used as a framework to rebuild the T3 mineralization models. And the critical point here is that the system is not hosted in a series of faults. It's hosted in a fold makes a big difference. Through detailed pitfall mapping of T3, we identified that the ore body represents a continuum of mineralizing events throughout the regional deformation regime. Mineralization fluids were not pushed along faults, they were sucked in the space accommodated by these noncylindrical folds. Mineralizing veins tend to cluster as envelopes around lithological contacts and fold hinges and as such, take on these stratiform geometries that you can see. The enhanced ore body knowledge here has enabled us for the first time to extrapolate these prospective horizons beyond the footprint of the pit itself and explain the enigmatic mineralization that we've seen in MOG65D. MOG65D represents a fold hinge on top of a thick package of sandstone with a thin package of silty mile sitting on top. And it projects a high-grade position along the footwall of the deposit and has subsequently been referred to as the footwall load of T3. We were able to get 8 drill holes into this footwall load earlier this year. And thankfully, each drill hole hit that target, and we've confirmed the model. This has given us a lot of confidence going forward to our other projects. And the important take home here is that through the process of remodeling T3, there seems that there will be little impact on the contained metal in the reserve itself. However, it's what it unlocks behind the pit wall that's exciting. As we move across to A4, I believe the story gets even more exciting, a similar process of remodeling the A4 deposit was undertaken with litho geochemistry at A4. And fortunately, from the beginning of the project, most of the drill holes were oriented. And so we had a really robust set of structural measurements that we could hinge the litho geochem against in lieu of having pit wall mapping data. So here we were, we were drilling out the extensional limits to A4. The model just wasn't quite stacking up. it didn't take too long though, for the stratiform light bulb to go off and we put a pause on drilling to allow us time to rebuild the models. Once we had a new mineralization model, remaining meters from the drill program we used as scissor holes across the deposit. And I'm very pleased to report that this model passed the litmus test with a 95% reconciliation of model against drilling and confirm the model again at A4. We're hopeful that the next exciting part of the story is the next chapter. As you can see here, A4 deposit sits on top of the northern saddle of the A4 dome. What the model has shown us is that there is a second southern saddle. There is some drilling into this Southern saddle, but it's never quite made sense. We're talking intercepts, the best of which was 35.2 meters at 1.7% copper or 15.45 meters at 2.9% copper. It's quite substantial. We've never been able to tie those together without a real structural framework to hang it together with. We're excited now because there's potential to unlock perhaps a repetition of A4, perhaps more. We believe that the Southern saddle does represent a repetition of A4. Of course, like any exploration, it's just a theory. It's just a model. We have to test it. The Southern Sable is our next major target for resource extension. And if this materializes, it will be a big step change and a long way along our path to the 15 and 5 strategy. utilizing the most capital-efficient method that we can. Stepping across to A1, this is now our study project. We're currently drilling out A1 at the moment from inferred to indicated. Fortunately, A4 has shared the same fingerprint as T3, as I've walked you through. A1, the early indications are that this shares the same fingerprint again. So it puts us ahead of the 8 ball when going through the study phase of A1. Again, it fits within a noncylindrical fold, mineralization is mostly stratiform. There's a little bit of discontinuity here and there. But overall, it fits the framework nicely. This is the drill program that we're currently undertaking, which will take A1 from inferred to indicated and allow us to announce a maiden mineral reserve on A1 that will take us through the study phase of prefeasibility, and that will lead us through the subsequent studies that we'll take A1 up to being the next satellite deposit in the Motheo hub. That is unless John finds something even better in the meantime. So I'll now hand over to John.

Cheers, Pete. All right. Thanks, Pete. This was put out earlier today, and Richard has touched on some of the journey we were undergoing in the exploration program. This really summarizes it. What I'll be doing is just going through and highlighting a couple of these things over the next few slides as to the exploration program in Botswana. I'm not going to read through this. It can be read through at a later stage. Coming to our project areas in Botswana. Rich has already mentioned the size of the ground that we have. It extends from the Namibian border down here in the Southwest, all the way up to the Southwest corner of the Okavango swamps. Motheo sitting largely in the middle of the -- our ground there. And historically, within the Kalahari Copper vault, which we cover the main portion of, the majority of discoveries have been formed -- found along what's called the [ Kanzi ] Ridge, which sits up running through here. Motheo sits on it as well. On the ground, that's barely discernible. As Richard has mentioned, the topography is minimal to say the least. It is a zone within which the standard exploration techniques of soil sampling followed by drilling work. The importance of that is a lot of our ground holdings are away from the Kanzi Ridge, up to the north here and down to the south where the Kalahari sands and the cover sequence is thickened, which has a major influence on the exploration techniques that are available, the ones that work and then we have to -- we actually have to use it to find more mineralization. Moving in onto the -- centering on to the Motheo area, what we call the Motheo hub. It's really exploration in the immediate vicinity of Motheo. We can see there are a couple of target sites which we put on to here. This is what we have so far. The NPF Decar contact mineralization, which sits in small parasitic falls is the main type historically. That's where everything has been discovered, up until the Motheo deposits were discovered. And we realized that these are actually seeing slightly higher in the stratigraphy within the lower Decar. And as Pete mentioned a couple of times, he said on periclinal folds, double plunging anticlines, which forms another target. Elsewhere within our ground holdings, we also have some -- what we would consider -- what we call nonconventional targets. These either sits elsewhere in actigraphy or in different structural and/or lithological settings. That increase in understanding of the target types and the potential out there has come through in the last couple of years with our work. That's something which we'll be coming back to each time. And the importance on that is understanding the belt and this -- which is a very, very underexplored part of the world, especially when we compare it to other areas, as Richard has actually mentioned. This is an example of some of the new techniques which we're trialing in Botswana. Richard mentioned it earlier, it's the seismics. This shows the 3 profile lines that we recently completed, 79 kilometers of an active seismic survey. In the same area as this, we've actually -- we're actually currently doing a passive seismic survey to compare the 2 techniques to see what we can actually gain from them. What we're trying to look through here is we're trying to understand basement features. These profiles have good resolution down to about 7 or 8 kilometers. We're not planning on mining down of those depths just yet. And also, we're looking in the shallower sort of the 1 kilometer zone, as you can see there's pretty good resolution on a lot of this from the interpretation so far. We sent it on the T3, A4 and A1 dome because that's where we have the majority of geological data to date. The vast amount of drilling. We understand the mineralization sitting within those areas much better than we do elsewhere at the moment. Okay. This now is an image of the first vertical derivative of the airborne magnetics data. And given the paucity of base geological information, i.e., there's very, very little in the way of geological maps in this part of the world, and that's a direct result of the cover sequences. So you're going in essentially blind. But we use the magnetics. That's our basic start point to understand the geology and start mapping out the geological formations. It's incredibly useful and a vital part of our techniques. We're using this for different scales of exploration. We're looking at the entire basin, as Richard has mentioned. We also look at like a camp scale as you have here in Australia, such as around the Motheo hub. And then we go down to the detailed prospect or deposit scale as well. Now if we have a look at this image, I want to give you sort of one example of some of the information that comes out of it. There's a very bland looking signature, which is running through the middle of these anticlinal feature here. You can see several of them. That's the [ Engracopan ] formation. So as we take a step back to the original historical target in the Kalahari Copper Belt, it's on that contact zone with the overlying units, the Decar, which are sitting here. So that contact is the original target zone. Now we've got lots of it there. If we were to start looking to drill as we did back in Zambia, I wasn't around then, but then the sort of 50s and 60s when the guys were drilling on the ore shell on a regular basis, we make all the drill companies incredibly rich. We fully break the budget for Sandfire. So we had to get a lot smarter than that. We had to understand the geological settings, and we had to understand of the geology in the original basin. And we also had to understand the controls on the mineralization, the structural controls on the mineralization and that's become more and more important. That's what we've been building on the last 2 years. We've actually been deliberately aiming at understanding that those geological parameters -- it just -- it's vital for the future of the exploration within our KCB holdings. This shows another example of some of the work we've been doing over the last year. This is a compilation of various airborne electromagnetic surveys. The difference in the sort of granularity on this over here is because of the different line spacings that we've flown over different areas of our holdings. And of note on this is the resolution of the image, which is a direct result of the thickness of the cover. AEM is superb at picking up domal structures such as we have over at Motheo. But as soon as you start going over the sand cover or thicker cover, the signals attenuate. And that has to be taken into account when we're actually doing our modeling. These very high signals up here are actually coming from overlying Karu shales. So there would be like a false positive and something we'd have to window out in our interpretations. Right. This comes back now to the AGG program. As Richard mentioned, we covered a lot of our competitors' ground or third-party ground in collaboration with them. The benefit for us was, obviously, we got to see a bigger picture. We flew over 50,000 line kilometers on this. As Richard mentioned, it was a big survey and nothing like this has ever been done before in Botswana. The purpose of this was to really try and understand the definition of the original basin and the sub-basins within that, which are vitally important for understanding the potential of different parts of the belt. As we said, we could have put drill rigs in here for Africa and we could have carried on drilling. But we needed to be a lot smarter in our interpretation on how we actually go about our exploration. And because it's a basin, as Richard has mentioned earlier, the similarities with some of the oil and gas business. We've accessed consultants from that world to assist us in the development of our 3D basin models. It's an iterative process as we go through and acquire more data, whether it's the drill rig or things such as the seismics, we factored that back into our model and our models develop, which then assist back into our target generation and we reprioritize our targets as we go. So coming back to the AEM image. This shows some of our current targets. The dash line shows what we are sort of from the exploration perspective are considering the Motheo hub, anything in that obviously not outside of our prospecting licenses. But within there, we would actually be focusing as a source of feed for Motheo. But in addition to that, we've shown some of our nonconventional targets down here with the dark blue. So we have other areas, which we're moving into. Our focus has been on Motheo for obvious reasons, and it will continue to be on Motheo from the exploration perspective. We're working very closely with the mine geology departments. So as their understanding increases, so does ours. And the 2 are actually going hand in hand. We're also moving rig up to the Ngami land area, which is up here and further down to the Southwest, which Brendan mentioned earlier, spreading our focus out into the broader land package that we have out there. A really important point on this, I think, which I have mentioned, but it needs to be reiterated is in a lot of these areas that we have, especially down to the West where we have deep sand cover. There's been no exploration, like zero. There's not even one borehole down there. There's a very occasional farmers water well to go down about 250 meters with very, very little in the way of geological information. This is frontier stuff out in areas like that, building on the back of the understanding we're in here of the Motheo hub and we start expanding out. That's where the -- this has huge potential from an exploration perspective because it is so underexplored. And we know we're in elephant country already. The exploration program is building on the last 2 years of understanding the geology, and the mineralization controls. And all of these things are building into -- we're able to now start ramping up our rigs. We have deliberately kept our rig numbers down so we can actually use the drill rig judiciously. Generally, our big spend is on the drilling, and that's what we've been keeping a handle on. We moved up to couple more rigs this year. We're getting another 1 coming in, in January and probably a fourth to assist some of the closed mine exploration at Motheo. And all of this now is gearing towards increasing the speed of our target testing, which will lead through to our next discovery in the KCB. And at that point, I'm going to be handing over to the MATSA team.

Thanks very much, John. We're now going to transition towards MATSA, but when I listen to what the guys have done at Motheo, whilst we're in different parts of the world, different belts and have taken different pathways. We're definitely on a similar journey in regards to our orebody knowledge. And I feel utilizing our Sandfire way, a way of working. We've got to a point now where we are both very comfortable and have a good foundational knowledge around our orebodies to take that next step forward into what Brendan referred to as that discovery phase. So again, a familiar slide from the pack. Today, what we'll talk about with MATSA is the journey we've been on to develop our geology models and our ore body knowledge. We'll touch upon some of the early success we had to provide that proof-of-concept work. We look at some of the targeting that has come out of that hard work that's gone on over the last 2 years and some of the drilling programs we've designed upon that work. And we'll talk more about some of the targets we've set ourselves over the next 12 months and 4 years, aligned with our 5 and 15 -- 15 and 5, that will be very bad, 15 and 5 program around our ore reserve growth strategy. So where are we? Most of us are familiar with where we're, we're in Southern Spain. We're in Andalusia and we're in the IPB. Here, we have our ground, our landholdings stretching across the border into Portugal as well. And we have MATSA, Aguas Tenidas, Magdalena in the northern part of the belt, and we have [ Sortilin ] the southern part of the belt. And you can see we're in good company here as well. And the reason for that is we're in the IPB. We're in the Iberian Pyrite belt. We're in a belt that had 2,500 years of mining. It's one of the most significant metallurgenic provinces on the planet. It's one that's got a rich history and it's one that we feel has got a very bright future as well. Richard referred to VMS deposits earlier. Obviously, we've had DeGrussa in the past and now we've got MATSA and we've got Aguas Teñidas on the left here, Magdalena on the right. They're 8 kilometers apart. And VMS deposits tend to form in clusters. Tender forming groups, which why we're quite excited about the northern part of the belt. What we'll use today is we'll use Magdalena there to sort of step through the work we've conducted, step through the journey we've been on. And what we've got on screen here is the long section of the Magdalena deposit. It's a section I'm familiar with because it's the one I saw on February 1 2022, when we arrived at the asset. And it's quite a simple model from a geological perspective. For those sort of without the trained eye, we've got a lot of jagged edges, some holes, not a lot of data informing it other than sort of grade. And these models are all built on grade. Not a lot of geological information went into it. There wasn't a framework that these models were built upon. So we went on a journey to try and understand what the gaps in that knowledge were, and we have to start with our people. Our people are our most important asset and we have to start there. We realized very early on from a group that really, really prides itself on our geoscience and our geoscience capability, and we've seen some of that today that we need to make sure we've got the right people in the right roles within the geoscience group. And that's one thing that we have the support of the Board, the executive straight away was to get the right people in the right roles. So we did a reorg. We've got the right structure in place, and we introduced some key talent into that team to make sure that we were able to go on this journey to understand the ore body knowledge. These models aren't based on structural information because we had no orientated drill core. We had limited geochemistry. We had a limited knowledge about the mineralogical domains, the geometallurgy or the geotech. So these are informed on very little knowledge. On the scale of thinking, the team when we arrived were a bit like an old-school miner, trying to follow an all-vein underground. So every year, they would drill a little bit around the edge and add a little bit on to the resource every year. That was the strategy back then. But we had to change the scale of thinking in their minds. If we're going to achieve 15 and 5, we were never able to do that. So we really had to change the way people thought. If you want to build a good mineralization model, you need to understand the rock package that, that mineralization sits within. This is a section cutting through the original mineralization model of the lithology model, the rock units that are hosting the mineralization. Now it's a very basic model. It doesn't have a lot of resolution, not based on a lot of data, limited understanding. And you can see some disconnect here, some very simple ones there, the dip of the lithology to the dip of the mineralization. There's something not quite right with that model. So we've spent a long time trying to upskill the team, again, put the right people in the right roles and support them in the right way so we can understand this work much better. And what we've ended up with today is something with a lot more resolution, something that allows us to really understand the framework we're working within, to understand our mineralization domains. What controls that mineralization? Why is it there? One you understand that, you're able to target in a much more efficient manner. So what we have here in blue is our sedimentary package, the volcano sedimentary package and flanking that to the left and the right in the green is a diabase, a much harder rock bookending that mineralization. And other things we've been able to add into it that provide us a lot of nice detail is some of these alteration zones, that's a silica alteration zone, which acts as a MAG horizon for us now, something we didn't understand before. So what I really want to emphasize at this point is now we have sort of a map, a key to try and unlock some of that value. And that's led us to today. So that's 2 years of hard work to get to that point. We've now got a team that have a much better understanding of the lithology, the host rocks, the geochemistry, and that's led us to today. So what we have on the screen here is our mineralization model, our resource of Magdalena. We've got the infrastructure on there. We've got some recent drilling. In red, we've got the massive sulfide and in pink, we've got the halo. And the halo wasn't understood of anything before. It was just the upside in the reconciliation at the end of the month. But now we have a geological understanding as to why it's there, and we can use it. And it's provided great value to our operations on a day-to-day basis as well. So whilst we're thinking long term, we're also trying to extract value from these models in the short term on a day-by-day basis and a month-by-month and quarter-by-quarter. So what I want to draw your attention to, to start with is a couple of our depots that we've put in lately at Magdalena. And deep drilling wasn't a technique or wasn't something that we -- was completed at MATSA before Sandfire's ownership. Those holes are down to 1,400 meters, downhole, around 1,200 meters vertical. What we have here is a hole that's 150 from the ore body and 400 from the ore body. And it's worth noting that our asset head, Rob Scargill at MATSA, he likes to frame it in a nice way that every 100 meters added to the ore body is about a year of mine life. So what we have here are 2 drill holes from surface down to 1,400 meters that 1 hit the right rocks, 2 have mineralization in them and 3 around 400 meters from the ore body. Again, a proof of concept that our lithology models, our mineralization models, our thesis, our hypothesis is playing out and again, valuable information for us. Now whilst some of these intercepts aren't as thick as we would hope, what I want to draw your attention to here is the Masa Olivo zone. You would have seen some of that in the releases we placed in the last 12 months. And this was an area that was deemed sterile when we arrived. And after a period of 12 months when we started getting to grips with our lithology, lithological understanding and structural understanding, we decided to put some drilling in that because there was nothing telling us that, that area was closed other than previous information, historic information on the few drill hole here that had some very minor intercepts or none at all. And we put a drill hole in 15 meters beyond a sterile hole, and we hit 15 meters of mineralization just in this corner here. And that told us something we didn't know, at some part of the ore body, it pinches and swells. So what we anticipate down here is that continues down plunge. This ore body is pinching and swell. And let's not forget that some of these discoveries we have had near infrastructure, so they're easy to access. It provides our mining team with a new mining front quite quickly. It's already in resource. Some of it's going in reserve now, which is a great result for us in a short period of time. Now this is a long section of the Magdalena resource today. It's worth noting that what you're seeing on the screen is about half the size of Aguas Teñidas. It's not anywhere near the Aguas Teñidas size at this point in time. So from all the work we've done, with understanding our lithology, our structural controls, our new mineralization domains, some of the new drilling we put in place, some of the geophysical data we've utilized. And again, geophysics wasn't anything that was utilized at MATSA previous to Sandfire's ownership. It's a new technique that we're employing and these ore bodies do respond to geophysics quite well. We have now developed these targets. And these targets are well thought out. They're not just let's drill in this zone, let's drill in that zone. These are targets that tick our boxes. We're trying to be very disciplined about our approach. It's a system we've developed over the last 12 months. So whoever -- whichever geologist is trying to design a target is going to design it in a similar way to another geologist. We can get repeatability. So what we have on screen here in orange are those targets. You can see we've got some big targets down plunge of Magdalena. We got some targets to the west of Olivo. And whilst these are our focuses, we don't -- we're not taking the eyes of other prizes we have either. And what we have on screen in terms of the purple drilling is our FY '25 drill program. Across the 3 assets we've got at MATSA, we're going to try and drill where we're going to drill 100 kilometers this year of drilling 100,000 meters. We've got 8 rigs employed at MATSA at this point in time, 7 underground, split 4:3, Magdalena to Aguas Teñidas and 1 on the surface as well. That's a record for this team. And the only reason we're able to do that is because we've got the right people in the right positions with the right skills now to deal with that. And from a broader perspective, aligned with our strategy, 15 and 5 years, that's the drilling program we're attempting to do now over the next period of time up until FY '29. The only reason we're able to develop a program that we feel confident in like that is because we feel we've got the right tools, that's the people, the geology and the right systems and processes in place, aligned with our way of working in the Sandfire way. So it's something we're very excited about. There's huge opportunity at Magdalena. We've done a lot of work to get to this point. It doesn't happen overnight. And now we've got that foundation built. It's time to start moving into that discovery phase. And now we're going to move 8 kilometers to the west to our Aguas Teñidas deposit. And the same thing has happened at Aguas Teñidas that we've done at Magdalena. We've gone through the same process of evaluating all our data, all our information and rebuilding the models from the ground up. That's the lithology model, the structural model, the mineralization model and our geometallurgy understanding and our geotechnical understanding as well. What we have on the slide here is a planned view of the San Pedro zone. Now this was our earliest proof of concept before the Olivo zone, and it provided us with a really nice understanding that the work we were doing was good. This is very close to the mine infrastructure as well. So it didn't take us a lot to get out there. It's easily accessible. There's some already in reserve, and this is something that we only discovered 18 months ago. So another proof-of-concept win for us in that regard. And whilst we're very pleased with what we've found at San Pedro, we still think there's more to go. It's not like we're resting on our laurels, so to speak. And again, utilizing the good work that we've done in the lithology space, we can see now what that target horizon is, and we've been able to model it out. And that goes across the whole deposit. This is one example. But that really gives us a nice way to rank our targets, prioritize our targets, make sure that we are utilizing our drill rigs in the most capital-efficient way that we can. So we can get that resource, get that reserve into the plan as soon as possible. And whilst money is capital, it's also time. We're also up against the clock. Now this is an oblique section of San Pedro, and these are some of the intercepts we've had. We've got good thicknesses, good grades. The mineralization is very much aligned to what we see at Aguas Teñidas. So it shows the continuity of the ore body, a consistency to the ore body that we understand. This is not something very different. It's just unknown. At that time, it was deemed a sterile area as was Olivo. And with the new tools that we've developed and the skills we've developed, we've been able to unlock some value very early. Now we'll go into the stockwork zone. Stockwork zone is a massive volume. And the original models we inherited were models essentially based on a 0.1% copper cut off and essentially a bit of a potato sack, a bit of cover across that whole lithology. That didn't give us a lot of information. And what it did do was sort of dilute the grade through the whole unit, through that whole stockwork zone. And we do know now that we do have much higher grade zones within that stockwork. So the new model, the new understanding has been modeled so that we can protect the grade, make sure it's reflected accurately in the resource model and gives our engineers the best opportunity to go and get it. It also allows us now to target the stockwork zone in a more efficient manner to try and bring some of those high-grade shoots from that stockwork within. And again, that stockwork model now has multiple layers to it. It has the lithology unit, it has the high grade within and it has a halo as well. And as we did with the Magdalena deposit, this is a long section of the whole resource we have at Aguas Teñidas. And for scale, there you can see the strike length. And these are our target zones for what we see at Aguas Teñidas at this stage. And whilst it's a mature asset, we still feel there's a lot of upside here at Aguas Teñidas as well. And we're very excited to go and keep testing and keep drilling these areas. This is the San Pedro zone here, much higher up in the mine sequence, much closer to the decline, which is good. And we move on to what the drilling looks like in terms of what we planned. Obviously, San Pedro is a keen focus for us. We've got a lot of drilling planned there for the rest of this financial year and into the next financial year. And this is what the rest of the drilling looks like over the period of time that we anticipate to reach our goals of 15 years and 5. We've got a lot of drilling into some of our stockwork zones, which is now better targeted. We've got our Western extension area, we've got our Calañesa area as well. So we're very excited about the opportunities we've got at Aguas Teñidas as well. And when you think about it in a larger context, we're in VMS country, in the best metallogenic province the world seen, 2.5 years of history behind it and a lot of future ahead of it. And we've got open zones within both of our deposits which are only 8 kilometers apart. And the only reason those stopped where they are because we don't have the drilling. And we didn't have the drilling because we didn't have the knowledge. Now we've got those things in place, and we've got the support of Brendan and the Board to go and attack these with the speed of trust they have in us. So we've got 2 assets in one of the best belts. We've got open zones. We've got much better ore body knowledge, and we feel we've got a very bright future ahead for both of these assets. And now I'll transition over to Jim, who will give you an update on how he's utilized this information in a regional setting as well.

Okay. Thanks, Scott. Yes. Thanks for everybody for turning up today. It's -- I think we've been -- the quality of the talks is really quite incredible, and it's actually quite daunting for me to follow. And I just hope -- I hope you find it interesting. This slide really just talks about the journey that we're on to move to one of the pillars that underpin the Sandfire way and most resonates with exploration, which is increasing our reserves. As we move down to get there, we realize that one of the things we have to do is to look at not just the asset scale, but the asset scale. The Pyrite Belt is an enormous area. We have to have a significant landholding. We have to have the right data sets in place. We have to have the right people, et cetera. And as we work down here, we're now working through our F '25 budget, where we're looking to do plus 10,000-meter drilling program on both sides of the belt. So Scott's talk was very much focused on the assets. I would have liked to had a laser, which are in this area. And what I'd like to do is just scale back and have a look at the belt as a whole. What we can see here is an ortho photo of the Iberian Peninsula or the southwest of the Iberian Peninsula, which covers Spain and, of course, Portugal. The geology has been draped over that. And what you can see is the belt. It forms an arcuate belt covering 250 kilometers. It's about 80 kilometers wide in its widest part, and it hosts approximately 80 VMS systems. These are hosted in Paleozoic volcanic-sedimentary sequences, which I've highlighted in orange there. And then I've draped the mines and the -- the active mines and the historic mines over the top of that. Some of these systems are the largest and highest grade accumulations of sulfides on the planet, names like Rio Tinto, Neves-Corvo, Las Cruces are all form part of the belt. And not to mention as well, our own deposits at Magdalena and Aguas Teñidas. So as I said before, and people have been alluding to it, history is another one of my passion. So I'd like to just talk us through a little bit about that. The earliest mining in the Pyrite Belt is actually 4,000 to 5,000 years ago when the early people were mining copper oxide ores and refining pure copper. This changed about 2,000 years later, so about 3,000 years ago when the Phoenicians came over from the Eastern Mediterranean and made contact with the locals and silver and lead were added to the portfolio. That continued on really until the end of the Carthaginian and the Roman Empire. And it's important to note that a lot of that silver was going into coinage that was paying for the armies of the Carthaginians and the Romans that were underpinning the development and the growth of both the Carthaginian and the Roman empires. There was a resurgence of mining in the 1870s when they realized that there was large sulfide deposits to be discovered. In the 1870s, Rio Tinto was established in the area in 1873. It brought with it football, religion and all sorts of other things. But really -- and since then, up until now, just under 2 billion tonnes of sulfide ores have been taken out of these deposits. It's an incredible number. And winding the clock forward a little bit, we've got Sandfire today. They have a significant asset belt in the -- an asset base in the belt. We have our plant, as we've spoken about, we have 3 mines, but also not to forget what's also shown on the map there is our exploration permit. And we have about 3,000 square kilometers on both sides of the belt. And I've also put on there the red dots are the targets that are currently under investigation. Okay. So I just wanted to zoom in and just have a bit of a look at some of the areas we're actually actively exploring and also talk a little bit about the strategy that we're using. I've only been with Sandfire for -- since February, and I've been putting together a program based on a 3-point strategy. So where we feel it's appropriate, we work closely with Scott's team in and around the assets, because we feel that any incremental growth that we can assist in there helps the 15 and 5. We also see fantastic opportunity in our projects. We have 3 projects. These are inferred resources. We have Concepión, Poderosa and Buitrón. So we think that any incremental growth there would be -- is going to help as well. And the third point is that we mustn't lose sight of regional exploration, grassroots exploration, where we can make new discoveries stand-alones, et cetera, on both sides of the belt. So this is the block of -- well, I'll just go back there, just scale. The area that we're operating in is between Magdalena and Concepión and Poderosa, so that's about a 5 to 6 kilometer wide block and 5 to 6 kilometers wide. And what I've overlaid there is the geology. This is a working geology map that we've got. It's a complicated area, and I've overlaid the targets that are under review at this stage. There's lots of mines. There's lots of gossans. There's lots of really exciting rocks. Most of the targets that we're looking at are generally combined geology with geophysical techniques. So we're not just looking at straightforward drilling anomalies. We like to have geology in the mix. We're drilling EM targets along the strike from old workings. We're drilling gravity anomalies down dip from outcropping gossans, et cetera. And really, when I look at this block of ground, I've worked on the belt, I'm familiar with the belt and I've been here since I really started work. This piece of ground for me is probably the most prospective piece of ground for VMS exploration on the planet. And we must be mindful that within here, with all of the activity, this is the Rio Tinto mine down here, Poderosa, Concepión, they were mined for 100 years. Magdalena was only found in 2013, yes. So we really think there's stuff to be found there. So let's zoom out a little bit. Again, I put the targets on here to just show what a target-rich environment the belt is. And when I first started, one of the areas that we worked on, again, following that strategy that we put in place, was exploration in and around the Sotiel mine and the Buitrón project. What I've also shown there as well is grassroots exploration targets, where we're looking for mineralization, new belts of mineralized or new deposits underneath coal and copper. This is deeper. There's no expression on the surface, but they do offer -- this is the opportunity that if we find something, these could probably be stand-alone deposits. And I'm just going to zoom in to the area close to Castillo-Buitrón. It's an area called Tinto Santa Rosa. And what we're seeing on the left-hand side is when the mine was actually in operation in 1915 -- and I'm just going to point out a couple of things here. So up here, this is the mine owners -- this is the mine manager's house. This is the equivalent of the police station. This is the open pit through here. There is in there somewhere a mill. Before the railways were put in line, that was a standard -- that's how they would get the mine -- the ore from the mines down to the ports in Huelva. And of course, you can see the open pit. This was a photograph I took this summer with my drone. And we can see that, that's the open pit. It's the same open pit. We can also see the shaft, which is present on that photograph as well. The mine owner's house, that's long gone now, and so has the police station. But what you can make out, I hope, are the 2 drill rigs that are drilling geophysical targets underneath the main open pit. Both of those holes hit stockwork mineralization and had significant downhole EM targets on them. So we'll be going back there later this year to finish off that program. I should also mention as well that there's a whole village through here. And just off the picture, there is the first tennis court that was ever put in Spain. I just think with Nadal, we probably left the rule book for him. Okay. So zooming out now to Portugal. I think the first thing to notice is the exploration licenses we have there. We have a significant holding of the belt on there. We've got over 2,000 square kilometers of 100% owned ground tenure there. But also highlighted is the Sesmarias deposit. That's held in a joint venture, and we've been drilling sulfide mineralization under post-mineral tertiary cover for a number of years now. And recently, we've been putting out some results on those drill results. As we move forward in Portugal, one of the things we're looking to is to develop a stronger portfolio of targets on our 100% owned ground. Most of that will be under cone cover or under tertiary cover and in nonconventional settings. So I'm excited about that. And I think then really just to wrap up, yes, it's been a pleasure for me to come over here and showcase the regional exploration programs and some of the work that we've got going on there. We are developing not only a basin-wide or a belt-wide approach to exploration here, but we're also developing some great teams on both sides of the border. It's really important. Scott pointed it. We -- the company is only as good as it's men, and I firmly believe that. And I also think I'd like to resonate what Scott also said was that we do have great support from the Board and the management about regional exploration, and I'm extremely proud to be part of that team.

Thanks, Jim. So turning to Black Butte. And perhaps before we do, I just want to reemphasize one point that Jim made. When I was driving around the area around Andalucia a couple of months ago with the team -- and you literally stumble across old gossans, old workings, very rudimentary open pits with historical sort of processing infrastructure that's also obviously shows the degree to which the industry has come a long way. But what struck me was that -- and being a person who once upon a time called themselves an exploration geologist, I reflect that if you're in Australia and you have an old mine and old working of any sort, in every cyclical upswing, there's a junior that raises capital and drills and tries to convince people that there's mineable economic reserves and resources. And in some cases, they're successful. And that happens cycle after cycle after cycle. What's remarkable about this area that, that just hasn't happened. So there are so many targets that are defined by historical mines, historical workings, where we know significant metal has been extracted using very old technology that have never had the benefit of modern technology, modern geophysical approaches and modern approaches to exploration. And that is what we see as a huge opportunity, not only as Scott talked to, to extend the life of Magdalena and Aguas Teñidas over time, but actually, we're hopeful of being able to supplement that with new discoveries. So turning to Black Butte. I'll keep this simple because, obviously, Black Butte sits within Sandfire America that is a separately listed entity. And really, there's just a reiteration of things we've said recently. We are derisking this project, as we highlight at the top of the slide, and we're doing that by drilling out the high-grade lower zone. And you can see the grades here, they speak for themselves. As we're working through and the team is working through the reassessment of the project, as we're aiming to move into the full feasibility study phase, clearly one thing you'd expect is that we're starting to capture the operating cost inflation that we've seen in North America. Of course, that really increasingly focuses you towards the Lower Zone and the higher grade versus the upper zone. And that's the work that will be undertaken as we complete the feasibility study stage. And a large part of the future investment that we've effectively flagged if we move through that tollgate, we'll go into the drilling of the Lower Zone and the continued expansion, we hope of that resource and expansion of the reserve. And as I said earlier, that is something that I expect Sandfire America, but also our Board will be contemplating early in the new year, is an additional funding commitment to enable that work to be done with the hope that the full feasibility will be completed towards the back end of FY '26. And then we'll have some, obviously, particularly important decisions to make. So with that, I won't go into the key messages. I'll hold my closing remarks to the end. My sense is the best thing we can do is just quickly get into Q&A. We've appreciated your patience. I hope this has provided you with a lot of new information and a lot of color. And as I said, I'll round out with some closing remarks. But why don't we just see if there are any questions in the room? And maybe if you can just state your name and -- for the benefit of the webcast.

David Radclyffe from Global Mining Research. First question is on Motheo and the airborne survey there. Could you maybe remind us of the geophysical and geochemical signature of the Motheo deposits and the context there being, I think there was about 15 targets within 70 kilometers of the mill? I guess this slide didn't give us a good color for how many of those are really you think are high-quality and high-priority targets.

Yes. Look, so maybe I'll take the first part, and then I don't know, Richard, if you want to have a go and the team, as is required. I think the key point we wanted to make upfront is our understanding of this province now is fundamentally different than what it was. And so hopefully, now you can recognize that we're in no way being, if you like -- we're not overstating the fact that there has been a step change in our understanding of the controls of mineralization. As I often think about it, this is more akin to petroleum geology because we know -- and this is the big difference for many people in this part of the world who are not familiar with sedimentary copper basins. We know the whole basin has pervasive copper mineralization. So what we're looking for is where there has been structural activity, pressure, temperature, fluids that are remobilizing that copper and just like hydrocarbons forcing them up into traps, where we get economic mineralization. And often, the carbonates play an important part in that role as well. We understand that much, much better than we did as little as 12 months ago. In terms of the targets within that hub, we've got to be careful. JORC is quite a constraint when we talk about exploration targets. But what we can say is the majority of those targets have the potential to be akin to the types of deposits that we're mining today. We need to do the work. We need to drill them. So they're significant. But as I said in my earlier comments, drilling is actually the litmus test or, put another way, the necessary evil of exploration and discovery. We all know that the worst thing you can do with a target is often drill it. I think the difference here is just the level of prospectivity that we see in what is nascent exploration territory. Richard?

Thanks, Brendan. Yes. So these targets are really derived from our 3-dimensional model from the combination of all the geophysical techniques that we use. We don't have a good surface geochem response. We've tried multiple different techniques and ones that supposedly looked through cover and have had little success with that. So we take the learnings from what we've seen in the mine. We build that into our 3D model. We've got -- we've been -- we've got a really good data set now. So we build, we rank, we test, and then we learn and then rebuild that into our 3-dimensional model. So in my world, we're very efficient with capital. Targets have got a pretty high threshold to pass before we'll drill them, because it's an expensive test.

I think one of the things to add is these are the best targets we have today in that area. There will be more. So as we're refining our process, there'll be more. So we've only recently completed active seismic over parts of this area, and we'll have more information shortly because we're also running passive seismic. So having really had the revelation, if you like, that these symmetric isoclinal folds are a critical determinant of economic mineralization, there's nothing better than defined structure than seismic, particularly in a sedimentary basin. Whereas, obviously, in a number of parts of the world that many of us are familiar with, it's things like EM, it's things like MAG and so on. So this is a different approach. And so again, as we receive more information, we interpret that information, I expect that we'll actually see the number of targets grow, and we may reprioritize along the way. Thank you. Next question?

Brendan, I've one on online. [Operator Instructions] So this one is from Ben Lyons. Sorry to briefly depart from exploration, but are you able to please provide an update on your interactions with the new Botswana government? What are their main policies regarding mining and whether anything has changed on the ground in Botswana?

Yes, Ben, thank you for your question. As you would all know, the government is very focused, obviously, in starting their period of governing in a positive way. I think a big part of their focus initially has been filling the critical roles, and we've watched that with great interest. I often reflect on the fact that, yes, this is the first change in government in 58 years. But when you look at the quality of the individuals being elected, it is quite remarkable. President Boko himself is a Harvard graduate. When we look at the Mines Minister and the experience, again, it gives us a lot of comfort. I do understand, probably reading the press much like you, that they're very focused at the moment in terms of the diamonds industry, which wouldn't surprise any of us. And hence, I think their attention is certainly there. We have had good initial dialogue, as we've continued to do so over a long period of time. And we're very confident that when we look at what the government is saying, they're looking to grow their economy. They're looking to drive employment. They're looking to continue to support citizen economic empowerment. And I think there's a very strong recognition and understanding that the Kalahari Copper Belt will play a critical role in that. So again, we're looking forward to our first direct engagement with the President. I'm hoping that will occur in the new year. As I said, they've got a lot to do. But again, we have a very good relationship with all of the stakeholders in Botswana, and we're expecting to continue that with the new government. But thanks, Ben.

Daniel Morgan from Barrenjoey. If I've heard the messages correctly, it appears you spent a lot of time in both basins, generating knowledge, target generation, and it looks now like you're going to pivot a lot more to a drilling heavy focus. Can you give us a sense of how much drilling you've done in the last couple of years, how much you're going to do in the next couple of years? And then, I guess, the gateways to taking that information and turning it into what are the targets on resource updates, reserve updates and turning it into commercial outcomes.

Yes. No, good. Thanks, Dan. And what we've tried to do in the presentation is to give you a good flavor for that. Look, exploration is somewhat more amorphous than other things we do. And so it's very difficult to be 100% certain of the direction of travel because obviously, a lot of that depends on future success. But as I mentioned earlier, we're increasing our level of spend by around 75% this year to $62 million. Those of you who are focused on the detail will probably recognize that, that doesn't correlate with what we call exploration and evaluation spend in our guidance. That's because that is the element that is expensed, which sits more with Jim and John and Richard's team. The piece that sits with regards to infill and extension drilling, so the additional amount, sits within sustaining and strategic capital. And I'm sure offline, Dave can help you work through that. But of course, Dan, to your point, we will see, and I'll pass to Richard in a moment, a significant increase in just the rate of drilling. We're moving from, as you said, building that foundational knowledge to actually drilling the holes, the necessary precursor to true discovery. In terms of the outlook, what we've tried to highlight in the slides and we understand there's a lot there and so I'm sure you'll get to absorb it over the course of the day. But in the first instance, particularly at MATSA, we would expect to be providing annual resource reserve updates. Now clearly, as I've said many times, when you think about the work that Scott took you through, which is really understanding the lateral extent of both Magdalena and Aguas Teñidas primarily and where we're chasing mineralization along these andesitic seals, it's actually much more analogous, I think, to what you would be familiar with the komatiites up in the nickel fields of Kalgoorlie, et cetera. It takes time, right? Because you're operating underground, because you're following these volcanogenic flows, it takes time to build critical mass of informations. And I've said this before. Therefore, we expect, if you go back to the 15 and 5 target time frame, you'd expect more of that to build as a critical mass towards the back end of that program. The difference with MATSA, as I see it, is it's a very quantifiable plan. I've said before that we're optimistic that the sort of target we've got is actually conservative or put another way, is if you risk it, it's eminently achievable, but in a very quantifiable way. We just need to do the work. We need to obviously, in time, establish underground drilling platforms, that also takes time and money. Whereas when you look at Motheo. Motheo is aside from A1 and the conversion of resource to reserve. That is more akin to the silver bullet. That is more akin to the discovery that we are hoping and believe John will in time make. So I don't know how to give you a sense as to when that's going to happen. Hopefully, sooner rather than later is probably the best way to put it. Maybe, Richard, can you add to any of that in terms of some of the numbers?

Yes. Just from an activity point of view, we've obviously spent that foundation time in Motheo building the knowledge, building the base there, and we did drop back to a single rig over the past couple of years. We spent a little bit of time with -- having success at A1 and then building that first inferred resource. So a lot of the sort of the regional work was more interpretive and building our targets. And I think in the next 12 months, we've already started with 2 rigs. We'll ramp up to 4 in -- early in the new year. And again, that enables us to take all that work that we've done and test those high-priority regional targets, which I think that's the silver bullet that we talk about, but it also enables to help the mine because they're pretty busy, they're in great control. And that new interpretation of A4 is literally hot off the press, and that is something that we need to drill as soon as possible. And as an exploration group, we'll step in there and help our colleagues in the mine to push that as hard and as fast as we can.

And I think, Dan, you'll see in the summary slides, all the meterages and so on are put in there for the various categories of infill extension, so on and so forth. I think Paul Young has got a question.

Yes, Paul Young from Goldman. Brendan, just back on to MATSA, just looking at that drill program. From all the targets you outlined at Aguas Teñidas and Magdalena, which has -- which targets with the highest potential NSR or margin? Would that be down a bit at Magdalena? And then also as far as the drilling you've conducted, the drilling you'll finish till the end of the year, maybe further to the question -- prior question is that we have enough information potentially to actually increase resources at Magdalena post this fiscal year, so the end of June.

Yes. Look, I want to be careful sort of preempting or flagging resource and reserve additions or otherwise. There's a lot of work, as you know, goes into it. You've also got a lot of quality control. You've got external and independent verification processes. But I think what you've seen is Scott and the team have done a remarkable job. I think he really told the story that we've referred to in the past of how simplistic the approach was historically, a very different owner with a very different approach focused on concentrate grade and quality for the next shipment almost to go into their global blend. And so taking that to a deep understanding of the geotechnical aspects, the geometallurgical aspects and obviously supplementing that with grade, and that's obviously led to the likes of Olivo and San Pedro. And what Scott didn't mention, which is a testament to the hard work, is we will have development units in both of those areas by the end of this financial year. So they're not just prospects, they are actually into the mine plant, which is outstanding. Because it's not only bringing ore into the equation, but it helps derisk the operation because, as Scott mentioned, we open up, as you would know, additional mining fronts. Look, I think in answer to the probably the heart of your question, the most prospective area from a scale perspective is clearly the downdip extension of Magdalena, both in terms of volume and potential NSR. I wouldn't underestimate, though, that all of the various elements where we're bringing in additional mineralization, like San Pedro and Olivo, within and on the bounds of the ore body also have potential for high NSR. But clearly, that down dip extension is critical. What we're very pleased, and we've talked about this before, to have identified is we now know that the host rocks extend down dip. So you would have seen some drill holes into there. One of the biggest challenges or risks you face, as you know, with exploration is discontinuity, faults or what have you, just fundamental discontinuities. We now know that the host rocks extend up to 400 meters down plunge of Magdalena, and we actually know that there's massive sulfide mineralization in those host rocks. You also heard how they pinch and swell. We've talked to you before how we've identified 2 major conductors down in that package. It's now getting access to the right drill locations that give us the right geometrical opportunity to give ourselves the best chance of success because really what we're looking to do there is to identify enough mineralization and prospectivity that justifies us putting a drive out into the extent of that ore body, such that we can establish underground drilling platforms to really then pepper it and confirm its potential. Now ironically, one of the great things that came out of the Aguas Teñidas due diligence, which was I always find quite a quirk and it has relevances. You would have seen the part of the ore body at Aguas Teñidas, which is up to the top on the left that has been mined in more recent times, that was discovered by accident when they actually developed out to the extent of the ore body so they can do exactly what we plan to do at Magdalena. It sort of highlights the target-rich opportunity that exists not just down plunge, but also shallow in the sequence. So all of those things will be a focus for us. But the critical thing is getting access to those drill pads and being able to test that downdip extension. And maybe to give you a sense, volumetrically of the opportunity, every 100 year -- 100 meters of extent is about a year. So that's -- in terms of the 15 and 5, that's the opportunity set.

And then just at Black Butte, just proof of concept at Johnny Lee and really what you're trying to achieve through the drilling program as far as proving up more high-grade material and how that -- just ideally, how you see that playing out as far as -- conceptually, how the mine plant plays out as far as how many tonnes of high grade or how you're going to redesign the mine to basically maximize NPV, I guess, is what you're trying to achieve?

To me, what I'm wanting to do, what the team is focused on is how do we maximize IRR, right? So to me, we operate in a very volatile industry. There is ever-present risk when you're developing a capital project. I think the IRR is often a good indication of a payback period, which has a way of, I guess, encapsulating risk. So our current priority is really drilling out that Lower Zone. Obviously, in the background, if we tollgate through to feasibility, it will be taking what is concept level updates of the pre-feas right through to a full feasibility study conclusion. And a big part of that is really updating the estimates for the current cost environment because as we've talked about before, Paul, we're not going to reconfigure the operation. We've moved through, is it fair to say, quite an extensive approvals process and permitting process. So the last thing we want to do is reconfigure the operation. It's really making sure now we have a very clear understanding of the best way to extract value and to maximize that IRR. And the way that the cost environment for the industry has evolved in North America, that high-grade zone is going to become more and more important. So that's why we're spending time, we're spending money, aiming to extend the size of that high-grade resource, which will continue into next year, and then that will flow through into the economics. And then as I've said many times before, ultimately, as a company, we'll have a critical decision to make. And as was said to me by a prior colleague, the question of is the juice worth the squeeze for us is going to be the critical element. This is a new jurisdiction in a new time zone with its own different regulatory challenges and opportunities, really assessing whether that is best place for us. But ultimately, through derisking and creating real tangible value, there will be other alternatives for us to realize value. So we're going to have that ultimate decision to make as well.

Adam Baker, Macquarie. Just wondering at MATSA, you've got quite a large resource inventory there with over 2.2 million tonnes of contained copper, but your conversion ratio is seem quite low at about 27%. Just wondering how you think about the breakdown of infill drilling to convert some of that across to reserve versus the resource extension drilling to deliver your target of 15-year reserve life within 3 to 5 years?

Yes. Look, I'll pass to Richard, but -- and Scott may wish to supplement. But I think there's an important reality to this as well that we don't shy away from. We want to be transparent. We want to be held to account. Sotiel is a big part of that resource. Sotiel is in the South. It has a very different mineralogical sort of characteristic. It typically is finer grade. It's, therefore, more complex to process. And you would notice in recent times, we're very much focused on the extraction of ore from Elvira, which is the lateral extent of the ore body because of it's a high-grade component. Now we're looking for more Elviras. So we'll be drilling, if you like, further along the strike from Elvira in due course. But part of the reason for that lower conversion is actually related to the fact that a big component of it is Sotiel. And that's why what we really wanted to focus on today is the focus is extending down dip of Magdalena in and around existing ore bodies and chasing these volcanogenic seals. And I mentioned the komatiites in Kambalda in that district earlier. I'm always reminded that back when I was following them very closely in the early 2000s, you'd remember that Western Mining Corporation sold out and sold to juniors, because they felt that it was getting hard and getting old and they are moving towards the end of their lives, and they only shut recently some 20 years later. That's what we're looking at here. We're chasing the same sorts of volcanic flows. They just happen to be andesitic rather than komatiite. Does that help?

Yes.

Brendan, we have another one online from Kaan Peker of RBC regarding Motheo. With the footwall mineralization in T3, if successful, how do you conceptually envisage to mine this, another large pushback towards the end of mine life or another approach?

Look, again, I don't want to preempt that too much because it would be slightly speculative because there's a lot of work that has to be done in and around, I guess, the studies and engineering. But Jason might have mentioned previously on a call, and this is a really important point. We talked about the attractive sort of mineralization that it helps with processing. It makes it simple. It makes it relatively low cost. The reason is the bornite and chalcopyrite is really coarse, so it just floats really well. Another quirk of nature that we've found is that the conditions, the ground conditions are very good. So we've actually got a very conservative configuration for the footwall, which actually provides us with the opportunity now having confirmed the mineralization to effectively steepen up that wall at low strip ratio, which is what will help us and enable us to extract that ore. So hopefully, that answers your question. So it's sort of the polar opposite of what you inferred.

More questions?

I think part of the message here has been about -- or a big part has been the basin knowledge that you've gained through all the work that you've done. You've got a lot of ground in the basin. You don't have all the ground. Have you learned things about -- from an M&A perspective, where you might be able to target and do deals? And is there better ground that you don't currently hold?

Good question. Thank you. So why don't we start with Botswana? I think almost 17,000 square kilometers is probably enough for John to play with. So we certainly feel we've got some of the best ground. I think some of the ground to the North that one of our competitors holds with an operating mine and a development opportunity is also good ground. It's different to our ground. We're very happy with the ground that we have and certainly don't feel the need, if anything, to expand. And I would expect over time, we'll optimize it and trim. And that will also meet, I think, growing government expectations for tenure to turn. And we've made those commitments. So we feel very comfortable and confident in the acreage that we have there. Indeed, it's interesting. There are other players now that you would know that are also either active or supporting others on the fringes of the belt. And typically, where there is much deeper cover, which is either more expensive or indeed you need larger ore bodies and/or higher grade to actually justify development. So one of the benefits where we are, we think, is they suit the type of company that Sandfire is. And if you look at MATSA, and maybe I'll pass to Richard in a moment, but we clearly have the bulk of the Iberian Pyrite belt on the Portuguese side, which is a good position to be in. And then in and around our area, I think Jim talked about some of the ground we have, we think, is as prospective as anywhere for VMS discoveries. And I know he sort of said it flippantly, but 200 meters of stockworks being identified in drilling down dip from one of those Tinto Santa Rosa targets. You mentioned geophysical responses. I think we had the highest geophysical response we've ever had in a drill hole in the belt. That includes Magdalena and Aguas Teñidas. It doesn't guarantee anything, but it's really interesting. Just highlights the level of prospectivity. So we feel like we've got good ground in those areas. We just need to now do the work. And as I always say, yes, we want to extend Magdalena, we want to extend Aguas Teñidas, but first prize is actually finding other ore sources as well that may indeed have a higher NSR cutoff. So we're very focused on that. In saying that, I've said it before, there are junior -- sorry, there are Spanish private entities who have resources literally within sight of the head frame at MATSA, and we are continuing to have very constructive engagements with them. It's more about supplementing what we have. It's creating more optionality, noting that many of these stranded resources, I think was referred to in the presentation, they have no other real access to market. Our processing facility is the strategic asset in the region. Richard, anything you'd like to add?

Look, I think I'd echo your points there, particularly around the dual processing lines, so being able to do copper and zinc. We are the only processing facility in Spain that can do that. That could potentially unlock value for ourselves and value for these other private entities. So we maintain strong relations and we're working hopefully to an outcome one day.

Okay. I think we're done for Q&A. Look, thank you again for those who have joined us online. I hope the audio and the slide presentation has worked well online. It's often a challenge, but I hope it's worked for you. I also really appreciate the people who have joined us in the room. So thank you for taking the time out of your day. I'm sure having just returned from South America, you've all got plenty to do. So we do appreciate your time. Look, I hope if nothing else, we have responded to the numerous requests we've had to understand more about the Iberian Pyrite Belt and the Kalahari Copper Belt, and why we see them as being so prospective. I hope, if nothing else, we've wetted the appetite and you feel the need to justify those travel budgets and come and see us over there. The reality is we do believe with the challenges the industry is facing meeting future demand, but also the challenges it's facing with regards to cost pressure, capital cost pressure for what has been the historical asset base, particularly in the Andes with the porphyries. We think that it is the right time for people to, I guess, invest in time and effort to better understand what we hold and better understand the potential that exists in those regions. I think, if nothing else, the enthusiasm that the team has for what they do, but also the areas where they're working and the provinces they're working has clearly shown through. I really appreciate the team for that. It comes through in the conversations we have. So I'm glad that you've had the opportunity to hear it too. And perhaps just to close off, therefore, we should probably let you out more. So thank you, everyone. Have a good day. We wish you well.