McEwen Mining Inc. (NYSE:MUX) Q4 2022 Earnings Call Transcript

William Shaver: So that’s a really good question. So, just for your interest, we’ll do 100,000 meters of drilling this year at Stock with possibly some of that, in fact, not at Stock, but at Grey Fox and a couple of other projects, but a substantial amount of drilling will be completed at Stock. So, conceptually at this point, Froome will continue at least to the first quarter of 2026. And so, the transition across to Stock will be one where we will be mining at Stock before we’re out of ore at Froome. And so, that’s where we hope to increase the tonnage in 2024 — increase the tonnage coming from the Fox Complex, which will increase the total amount of coal that we are producing. However, at this point, I can’t tell you what that coal production might look like, in part because we haven’t all of the resources put together in mine plans for that period of time. But I would venture that it will be a couple of thousand ounces a month once we get it ramped up.

Unidentified Analyst: Okay. And so, you would — the idea would be that, I mean, it sounds like Froome is still a fair amount of exploration that it keeps getting extended as far as its terminal date. It sounds like there’s still a fair bit of exploration you’re planning to do there. And so, would this — would additional adjustments need to be made to the mill to accommodate this ore? Or is that in your plans for this year to accommodate ore — the increased throughput since it sounds like that’s kind of a bottleneck as of right now?

William Shaver: That’s correct. The mill has been a bottleneck. Crushing the ore at the mine has significantly lifted the pressure on that, because we’re basically — the plan going forward there is to basically crush down to 6 millimeters, haul that across and put it directly into the ball mill and leaching part of the circuit. What we have to determine this year is what the long-term configuration of that mill will actually be. Will we go to crushing at the Stock site as well? Or will we do something innovative at the front end of that plant, such as a larger ball mill, some other kind of tower mill to do grinding? But at the present time, we’re — part of our task this year is to figure out what that long-term solution is and then to implement that so that we can take advantage of not only ore from Froome, but also of course Stock, but also to have a view on what the future might hold at Grey Fox.

Unidentified Analyst: Okay. And one last question. As far as getting back on track in San Jose, I know there was a drop off in production last year. What changes are — Hochschild or — and you and Hochschild planning to make to kind of get production back up, or is it planning to operate at a lower level this year?

Stefan Spears: Sure. So, it’s Stefan speaking. So, production should rebound. Obviously, they’re not anticipating any of the issues they had in early 2020 to be repeated in 2023. And our partner Hochschild is projecting a significantly lower cost as well relative to last year. If you look at Hochschild’s guidance, I believe they’re guiding around $1,400 all-in sustaining. And yes, so I’d say overall a substantial improvement at San Jose.

Unidentified Analyst: Are you — will this potentially — are you expecting dividends? I guess, if production goes where things do rebound, is that something that they’d give guidance on so far?

Stefan Spears: It’s certainly something we’re expecting. But we don’t have the ability to provide any real color on that at this point.

Unidentified Analyst: Okay. Thank you so much.

Rob McEwen: Thanks, Bill.

Operator: And there are no further questions at this time. Mr. Rob McEwen, I turn the call back over to you.