William Oplinger: Not forecasting any issues around the part four process per se, but let me give you color around some of the concessions that we’ve made in the current process. The current MMP process, which we anticipate to be decided by the end of this year. We’ve added additional controls for protection of drinking water. We have agreed on distances from mining a certain distance from some of the key reservoirs and we’ve agreed to accelerating rehabilitation, and to increase the biodiversity in the near-term on the rehab. So those are the three areas that we have been discussing with the stakeholders and to try to get the current mine approvals through the process.
Alexander Hacking: Okay, thanks. And then just a quick follow-up on Alumar if I may. I think the message last quarter there was, you fixed the conveyor issues and, you know, above 60%, has something else gone wrong in the last quarter or are you still on track from where you were then? Thanks.
William Oplinger: Something big happened in Brazil in the quarter, there was a massive power outage. And if you follow our competitor there, Alunorte had the same issue, Albras had the same issue. We lost power for close to three and half hours in the smelter at Alumar. And that has knock-on impacts, not only on the smelter but on the refinery too. Now, thank goodness we had good stability, we had recovered stability going into that. We were able to get through that power outage, you know, what happens in a power outage in a smelter is that you stress the parts bringing back them — bringing them back online. We lost a few parts, I think we probably lost close to a dozen parts bringing the plant back online from that power outage.
So that was a setback. That really is out of the control, it impacted something like two-thirds of the country in Brazil. And so it was a setback for the plant. They’ve recovered. They have a daily action plan. It’s a daily go, no-go on restarting parts and increasing amperage and as we said in the prepared remarks, we’re at about 65% today.
Alexander Hacking: Okay, that’s super helpful. Thank you.
Operator: The next question is from Timna Tanners with Wolfe Research. Please go ahead.
Timna Tanners: Yeah. Hey, good afternoon. I thought I would pivot a little bit, if I could, talking a little bit about some of your strategic initiatives and the cash flows, if I could. So first off, I just want to ask, I know you talked about advances in EcoLum and EcoSource, but can you elaborate a bit on the premium that you’re garnering there?
William Oplinger: The premiums are consistent with the premiums that you see quoted on various sources. So, it depends on the product, but the premiums are anywhere between $10 and $30 a ton.
Timna Tanners: Okay, that’s helpful, thanks. And then if we look at your cash balance, I know in the past you’ve said that you wanted to keep it at or below — at or above a $1 billion and it kept below that. I know it’s not a perfect number, but if we look at the cash resources and use year-to-date, if there’s not a lot of free cash flow at these commodity prices even with the third quarter strong working capital release, and then we had from your Investor Day, you know, a great amount of initiatives that you’re progressing on, I know you referred to them in the beginning as well like Australia refineries the future, et cetera, and I’m just wondering how do we reconcile again this commodity price environment, with some of those initiatives and some of the cash needs to source those. So the CapEx requirements going forward, are they compatible with this earnings environment or how are you thinking about that?
Molly Beerman: Okay, thanks Timna. First of all, thanks for asking me a question. So let me just say on our cash position now, we’re at $926 million. We still have access to significant liquidity. We have our undrawn revolving credit agreement, we have our auxiliary credit line. So those are available to us as needed. As you know we’ve taken action in the past working capital programs to monetize that we can take more aggressive actions on cost control and portfolio actions, but for us, if I look at kind of the short-term cash preservation, it really is focusing on our operations that are consuming more cash than generating. So that is the focus Bill mentioned earlier, we have key sites that we are working to improve. So that’s the near-term on the cash management.
On our CapEx, you can even see from this year, instead of adding to our CapEx project list, and filling the queue to spend the whole budget, we ended up staying just with the capital plans that were already on the agenda. As they slowed spending, which typically happens, we allow that just to happen, and so we’ve saved some money on CapEx. We can do that again with the programs that are in the next queue, and if you look out to our breakthrough technologies, each of those have to meet a certain criteria before they’re going to receive funding, most of those now are pointing toward funding in 2025 and later. So we still have time for those and working through that financing and funding.
Timna Tanners: Got it. So bluntly then if the commodity price stays at these levels, you know, no concerns in terms of proceeding with some of those initiatives ELYSIS Australia refinery of the future et cetera, but if we started to get into 2025, and didn’t see much aluminum price improvement, then it might be needing to rethink some of those capital outlays. Is that a fair conclusion?
Molly Beerman: Yes, that’s fair, Timna.
Timna Tanners: Okay, great. Thank you for the help.
Operator: The next question is from Carlos De Alba with Morgan Stanley. Please go ahead.
Carlos De Alba: Yes, thank you very much. Congratulations, Bill. Just on — coming back — coming back to Western Australia. So I just want to understand if you know what might be potentially the implications of the EPA deciding to do a formal assessment of your — of your MMP’s and mining plans. Would that result primarily on just a longer approval process, maybe more detailed analysis and requirements or will also result in higher costs, may be above our — not beyond the 45 that you have, but that would prevent the 45 to completely come back to zero, once you are getting into the 2027 mining plan or those areas in 2027 with better bauxite quality.
