Pan American Silver Corp. (NASDAQ:PAAS) Q3 2023 Earnings Call Transcript

Page 6 of 6

Steve Busby: Lawson, if I could add from an operating point of view, I think from my perspective, the operation is much more comfortable with a lower grade cutoff at higher grade cutoff there was a lot of piecemealing if you will on the deposits. And it wasn’t — it opens up the mining. It opens up some opportunities for us to lower that cutoff to where we can look at more bulk mining even above what they’re doing now that could drive costs lower again yes. So that’s really where we’re trying to drive to is looking for efficiencies and it may come at a little bit less grade, but it’s — that’s what we’re trying to — that’s what this whole optimization study that we’re talking about is for Jacobina is where is that best sweet spot and can we mine more volume at a lower cost per tonne and withstand a bit lower grades.

That’s going to be many months of study, but we’re pretty optimistic walking into this. And I think that’s kind of the taste. What you’re describing is kind of the taste of where we see. We’d like to take optimization if you will at Jacobina.

Martin Wafforn: And just drilling at Jacobina, I mean it’s by far our most productive mine in terms of drill meters per ounce is added and it’s definitely [indiscernible].

Lawson Winder: No, what would the implication of [indiscernible] then for potential production growth? Like with all those…

Steve Busby: Great question. I get that a lot. Yes Lawson, Steve here. I don’t want to speculate on what that’s going to be. I just look at the ounces in reserves, the tonnes of grades I look at the ounces in resource tonnes grades and it makes me excited that there are some opportunities here, but I don’t want to speculate how big that could happen. It’s going to take us months to get through this done.

Lawson Winder: Well, I can definitely hear the excitement in your voice that’s great. Just wanted to [indiscernible] on that, but just maybe you could just share with us what the base case is for throughput? And then as a follow-up question to that, with respect to financing, it’s construction, I think you’ve mentioned that as potential consumers of funding going forward and have even sort of suggested some cautiousness with respect to potentially more aggressive capital return. What are the prospects for a – to help alleviate some of those funding demands?

Michael Steinmann: I can start and sorry, you’re cutting in and out there but I think I got the question on the Skarn. So let me know if you need any more details there. But look we need to finish the study of course and it will be out and then we have a lot of numbers and details to discuss how this is going forward. We are very, very open to any way to look at this project later on. I think there is a lot of way to optimize return for our shareholders that can be in different form and shape and can go from finding a partner or focusing on the silver to many other ways how to do that. And I really don’t want to fix that yet because there will be a lot of a lot of details that need to go into that decision. But I think a large deposit like the Skarn opens up huge opportunity for us to optimize that return to our shareholders.

So I think you should not just think in the normal case just building the mine and mining it out over the next whatever 30, 40 years and doing it all ourselves. That could be one outcome for sure but there can be many different outcomes to optimize that return. So it’s a little bit early Lawson, once we have the study out there, we should hope a lot of activity going on on how we can optimize that in a lot of ideas. So we already have a lot of ideas how to do that. And I will start sharing those ideas of course with everyone I think once we come out with the study and early into next year.

Steve Busby: And if I can add Lawson, this is Steve, relative to throughput on the Skarn that is one of the most debated subjects we have here internally right now and we are going to have to pick a base case, as I understand it to present a base case. But I think we’re going to open that debate even beyond ourselves and show some alternatives because it’s very interesting to look at throughput on this project. It’s such a massive project. There are so many opportunities Michael alluded to and the more people we get the more ideas we get, the better right now. So we’re going to open that up a bit when you see the study coming up.

Lawson Winder: Great. I apologies for the down quality on my end but I think guys captured the nature of my question very well with due response. Thank you very much.

Michael Steinmann: Thank you.

Operator: There are no further questions at this time. I will now hand over the call back to Michael. Please continue.

Michael Steinmann: Thank you, everyone for calling in today. Like – also we will provide early 2024 our outlook for the New Year. I know it was later this year because of the transaction. But normally we do that in January and we’ll do that in January 2024, when we’ll share all those details with you. And until then have a great end of the year and talk to you in January. Thank you very much.

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

Follow Pan American Silver Corp (NASDAQ:PAAS)

Page 6 of 6