Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Hug Bay Minerals third quarter 2026 results conference call. At this time, all participants are in listen-only mode. Following the presentation, we will conduct a question and answer session. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may reach an operator by pressing star then zero. I would like to remind everyone that this conference call is being recorded today, November the 12th, 2026 at 11 a.m. Eastern Time. I will now turn the conference over to Candace Brule, Senior Vice President, Capital Markets and Corporate Affairs. Please go ahead.

Thank you, Operator. Good morning and welcome to HUD-based third quarter 2026 results conference call. HUD-based financial results were issued this morning and are available on our website at www.hudbay.com. A corresponding PowerPoint presentation is available in the Investor Events section of our website, and we encourage you to refer to it during this call. Our presenter today is Peter Kukielski, HUD-based Chief Executive Officer. Accompanying Peter for the Q&A portion of the call will be Eugene Lee, our President and Chief Financial Officer, and Rob Carter, our Chief Operating Officer. Please note that comments made on today's call may contain forward-looking information and this information by its nature is subject to risks and uncertainties and as such, actual results may differ materially from the views expressed today. For further information on these risks and uncertainties, please consult the company's relevant filings on CDAR Plus and EDGAR. These documents are also available on our website. As a reminder, all amounts discussed on today's call are in U.S. dollars unless otherwise noted. And now I'll pass the call over to Peter Kukielski.

Thank you, Candace. Good morning, everyone, and thank you for joining us. HUD-BAY delivered record results in the third quarter, and our operating performance has positioned us well to achieve our annual consolidated copper production guidance for the 12th consecutive year and annual consolidated gold production guidance for the sixth consecutive year. The strength of our diversified operating platform and the dedication of our people helped us achieve record mill throughput at Constantia, significant increases in mine productivity at Lalor, record mill throughput at New Britannia and record gold recoveries at Sol. At Copper Mountain, our three-year operational turnaround delivered the first quarter of positive free cash flow since our acquisition. Following the quarter, we reached a significant milestone with the final investment decision for the construction and development of Copperworld. These milestones come on the eve of HUD-based centennial, and we were pleased to recently be recognized as a 2026 TSX 30 top performer, ranking among the top 30 performing stocks over the past three years. Furthermore, We were ranked as one of Canada's top-growing companies by the Globe and Mail's report on business and as one of the Fortune's fastest-growing companies in 2026. These recognitions reflect our consistent operational execution, strong financial performance, and commitment to delivering shareholder returns as a premier Americas-focused copper producer. Starting on slide 3, HUD-BAY delivered record performance this quarter with revenue of $766 million, achieving a new quarterly record and adjusted EBITDA of $413 million, resulting in record trailing 12-month adjusted EBITDA of over $1.5 billion. The strong results this quarter were driven by steady operating performance, attractive operating margins, and strong exposure to copper and gold across HUD-based diversified operating portfolio. During the third quarter, our operations delivered consolidated copper production of 30,000 tons and gold production of 70,000 ounces, increasing compared to the second quarter due to operating efficiencies throughout the business. We have reaffirmed our full year 2026 consolidated production guidance for all metals given our strong operating performance year to date. We continue to demonstrate industry-leading margins during the third quarter with consolidated cash costs of negative 19 cents per pound of copper and sustaining cash costs of $1.61 per pound of copper. Year-to-date results are trending well below the low end of the consolidated cost guidance ranges as our operating efficiencies and strong exposure to gold by-product credits have more than offset external cost pressures. This has allowed us to improve our full year 2026 consolidated cash cost guidance for a second time this year to a range of negative 55 cents to negative 35 cents per pound of copper. This is an additional improvement of 10 cents from the previously updated guidance range. We are also improving our full year 2026 consolidated sustaining cash cost guidance to a range of $1.40 to $1.80 per pound of copper. A $0.30 improvement from the original guidance range. Full-year consolidated sustaining capital expenditures are expected to be $35 million lower than 2026 guidance, with lower capitalized stripping in Peru and BC, as well as capital deferrals and efficiencies. During the third quarter, operating cash flow before change in non-cash working capital was $314 million. An increase of $104 million compared to the second quarter. Adjusted net earnings were $150 million, or $0.34 per share, reflecting strong gross profit margins from the continued focus on cost efficiencies and higher metal prices more than offsetting higher input costs. Slide 4 demonstrates the continued strong free cash flow generation as a result of our steady operating performance and strong margins. We generated $202 million in free cash flow during the quarter, an increase of approximately $100 million compared to the second quarter through higher production and continued strong operating margins. And as I mentioned earlier, this quarter was the first quarter of positive free cash flow at Copper Mountain since our acquisition. Over the first nine months of the year, we have generated more than $400 million of free cash flow Even after investing over $325 million of sustaining capital in the business, resulting in record trailing 12-month free cash flow of $631 million. As of September 30th, our total liquidity was $964 million, including $789 million in cash and $175 million of under-award availability on our revolving credit facilities. At the end of the quarter, we had a net cash position of $0.1 million, bringing our net debt to EBITDA ratio to zero times. Consistent with our prudent balance sheet management and balanced capital allocation framework during the quarter, we repaid $22 million of the outstanding $272 million draw of our revolving credit facility. Subsequent to quarter end, We proactively amended and extended our revolving credit facilities, upsizing the capacity to $700 million from $450 million and extending the maturity by two years to November 2030. The amended agreement includes an improved pricing grid and greater financial flexibility that reflects our robust cash flow, strong balance sheet position, and recently upgraded credit rating. After adjusting for the $250 million increase in size of the credit facilities, our pro forma liquidity is approximately $1.2 billion. As shown in slide five, our Peru operations continue to demonstrate steady operating performance with production and costs well positioned to achieve our annual guidance ranges. The Constantia Mill achieved record throughput of approximately 91,000 tons per day in the third quarter and is on track to achieve 34 million tons per annum in 2027. We completed the installation of a third rougher line in September, which immediately had a positive impact on recoveries. We also continue to advance the installation of two pebble crushers with commissioning expected later this month. Together, these enhancements will allow Constancia to continue to deliver steady annual copper production despite lower grades following the depletion of Pampa Concha at the end of 2025. During the third quarter, the Peru operations produced 21,000 tons of copper, 5,000 ounces of gold, 577,000 ounces of silver, and 301 tons of molybdenum. Copper and molybdenum production was slightly higher compared to the second quarter, reflecting higher mill throughput because of inefficiency improvements and the impacts of the semi-annual plant maintenance shutdown last quarter. Gold production was comparable to the second quarter. We are on track to achieve our 2026 production guidance for all metals in Peru, with gold expected to exceed the top end of the guidance range. Total material moved was 25 million tons during the third quarter, achieving a new monthly record in July. Total ore mined increased by 16% to 12.7 million tons compared to the second quarter, supported by active mining across three exposed ore phases and positive reconciliation. Our focus on mining exclusively in one pit unlocks operational efficiencies, including shorter hauling distances Paul Roos optimizations, and high truck fleet utilization. The record mill throughput of 91,000 tons per day was 7% increase compared to the second quarter, primarily due to higher plant availability and low ore hardness, as well as the benefits of increased mill processing capacity supported by the recently approved permit amendment. Third quarter cash costs in Peru were $2.23 per pound of copper, This increase from the prior quarter due to low silver and gold byproduct credits, higher profit sharing, higher fuel prices, and higher fuel consumption from increased material moved. Cash costs for the quarter were above the 2026 guidance range. However, year-to-date cash costs continue to outperform the low end of the full year guidance range, so we remain well positioned to achieve the 2026 cash cost guidance in Peru. Moving to our Manitoba operations on slide six, we delivered a strong third quarter achieving key operational performance targets and executing on our commitment to deliver a stronger second half of 2026. Our Manitoba operations produced 57,000 ounces of gold, 3,000 tons of copper, 3.7,000 tons of zinc, and 268,000 ounces of silver in the third quarter. Production increased compared to the second quarter as a result of higher mill throughput and improved gold feed grades. We are on track to achieve our 2026 production guidance for all metals in Manitoba. Performance at the Lalor mine improved significantly during the quarter, with improved equipment utilization driving efficiencies in underground development and increases in mine production. To address prior labor availability constraints and accelerate development at the 1901 deposit, we embedded an experienced mining contractor which allows our skilled internal workforce to be redeployed toward critical development areas at Lalor. In tandem, we have expanded our internal capacity by onboarding over 150 new employees this year. Our underground improvement efforts during the quarter included operational testing of a roadheader continuous mining unit to understand its potential in lateral development. The Lalor mine hoisted an average of 4,200 tons of ore per day during the quarter, strategically prioritizing gold feed. Development activity at the 1901 deposit focused on exploration and infill drilling, ore body access, and critical infrastructure, with late 2027 remaining the targeted timeline for full production. The New Britannia Mill achieved a new quarterly throughput record, averaging 2,250 tons per day in the quarter, aligning with gold ore output from LALOR. The mill achieved gold recoveries of approximately 92%, reaching a new quarterly record. The Stoll Mill demonstrated higher throughput compared to the second quarter of 2026, while achieving record gold recoveries of 74% as a result of our recovery-focused initiatives. We initiated early works on the Staal Hot Tails leaching project, which will unlock additional gold recovery from material processed at the Staal mill through leaching at New Britannia. We have also initiated early evaluation work on processing legacy tailings and mineralized piles to utilize excess mill capacity. We continue to advance key sustaining capital environmental initiatives, including a cyanide recycling project at New Britannia, and Adam Lift at Anderson Tailings, both of which remain on track for completion by year end. Manitoba gold cash costs in the third quarter were $403 per ounce, a decrease of 48% compared to the second quarter, driven by higher gold production and higher byproduct credits. We are well positioned to achieve our 2026 cash cost guidance range in Manitoba. At our operations in British Columbia, we achieved significant milestones in mining productivity, operational performance, and project execution in the third quarter, as outlined on slide 7. We also received ISO 14001 and ISO 45001 certifications at Coff Mountain, reflecting our focus on safety and environmental management. The positive free cash flow generation at Copper Mountain this quarter demonstrates the benefits from our continued operating efficiencies, recent mill improvement initiatives, and the ongoing execution of the accelerated stripping program. Copper Mountain produced 6,600 tons of copper, 7,000 ounces of gold, and 52,000 ounces of silver in the third quarter. Compared to the second quarter, copper and gold production increased with higher head grades and improved recoveries more than offsetting the impact of the primary sag mill maintenance downtime. We are on track to achieve our 2026 production guidance for all metals in British Columbia. Total material movement at Copper Mountain was 27 million tons in the quarter, which continues to be elevated with the accelerated stripping program. During the quarter, total ore mined increased 56% quarter over quarter, driven by favorable ore release timing from the north pit. Milled copper grades averaged 0.27% in the quarter, and copper recoveries slightly increased to approximately 80%. British Columbia cash costs were $3.09 per pound of copper. The improvement from the prior quarter reflects higher copper production, Thank you very much. Thank you. Leveraging our strong operational expertise and social license to unlock significant value. Portly material movement has more than doubled, increasing 108% compared to the levels prior to our ownership. With the three-year stripping program ending this year, we anticipate delivering higher grades starting next year, which together with the benefits of our mill enhancements is expected to result in a doubling of our annual copper production in British Columbia. During the third quarter, following the scheduled replacement of the primary sag mill feed end head in July, the mill has achieved successive monthly mill throughput increases. In September, the mill achieved mill throughput of approximately 43,500 tons per day. We remain on track to achieve the target at 50,000 tons per day by the end of the year, which would represent a 44% increase compared to the mill throughput prior to our ownership. These operational improvements have allowed us to significantly improve cash costs and deliver a long-term sustainable operation that will generate strong free cash flow. I'm very pleased with the progress the team has made to turn around this operation and dialogue significant value at Copper Mountain. Turning to slide nine, as part of our global exploration program, we continue to look for ways to extend mine life across our operations. This program has resulted in some exciting exploration news in Peru. At Constantia, recent drilling intersected a potential new high-grade feeder system, including over 200 meters of 0.43% copper and 0.03% molybdenum. For context, that is almost 50% higher copper grade and three times the molybdenum grade that was processed in the third quarter. The two deep diamond drill holes successfully intersected lateral and down-dip extensions of the porphyry system and mineralized breccia zones below and adjacent to the Constantia pit. This has been the most promising exploration results we've seen at Constantia over the past decade. Notably, the holes intersected significant widths of mineralized breccia extending beyond the limits of the current resource at grades higher than current reserve grades. Follow-up drilling is underway. along with geological vectoring to test the geometry and structural controls and determine the scale of mineralization down-plunge and at depth. This high-grade system has the potential to enhance Constantia's long-term production profile. Slide 10 provides an update on our growth and exploration activities in Canada. Thank you very much. focusing on converting our 1.5 million ounces of gold in inferred resources to reserves through infill drilling. We are confident in our ability to do so based on historical track records of converting approximately 90% of inferred resources to reserves at Lalor over the past five years. Second, we continue to extend the current mine life of our anchor deposit Lalor in 1901 which continue to show potential for extensions of high-grade stacked lenses and remain open down plunge. During the third quarter, advancement of underground exploration drifts at Lalor in 1901 established new drilling platforms that will enable additional infill drilling and testing for extensions along mineralized trends. And third, we are highly focused on looking for a new anchor deposit through regional exploration and advancing the Britannia Gold Project which I will discuss later in the presentation. In British Columbia, following the June groundbreaking at New Ingabel, the infrastructure development continues to progress on schedule, de-risking the path to first production in late 2028. We completed the West Access Road and established a temporary construction bridge to facilitate the installation of the permanent bridge. New Ingabel is expected to support continuous operations beyond 2040 and provide access to higher-grade ore at approximately one-third of the strip ratio seen in recent historical mining areas. We are also nearing completion of a 66,000-meter infill and expansion drilling program at New Ingabel, which will potentially allow us to convert additional inferred resources to measured and indicated and test for possible extensions beyond the limits of the current mineral resource. The drilling remains on track for completion in the fourth quarter, with results to be reflected in our annual reserve and resource update in March 2027. Additional geotechnical drilling and geometallurgical sampling are underway to support mine plan optimization and metallurgical recovery modeling. Slide 11 highlights the recent Snow Lake mine plan announcement and the significant increase in life of mine gold production. The updated mine plan reflects a 37% increase in gold production over the next five years and a 60% increase in total gold production over the life of mine based on current mineral reserves compared to the prior technical report. The updated mine plan maintains average production of 185,000 ounces of gold over the next five years, reflecting several optimization initiatives, including higher mill throughput at New Britannia and higher gold recoveries at the stall mill to better utilize the combined 6,300 tons per day of processing capacity. Lowe Lake's reserve mine life has been extended to 2043, with total current mineral reserve estimates of 27 million tons, including roughly 2 million ounces of gold. The increase is due to resource conversion at Larlor in 1901, higher reserves at the Wim and Three Zone satellite deposits, and the first reserve estimates for Talbot and Rail. The updated mine plan represents a conservative view based on Hudbay's historical high resource-to-reserve conversion rate. The mine plan has been optimized for higher mill throughput rates at New Britannia, increasing milling rates from the current 2,000 tons per day, exceeding the nameplate of 1,500 tons per day, and ramping up to 2,300 tons per day starting in 2027. It also reflects the benefits from the Stall Hot Tails leaching project that aims to recover additional gold and silver Thank you very much. Flight 12 highlights the Britannia Gold Project where multiple targets are being developed down plunge and along strike from known mineralization across a mineralized corridor that spans five historical deposits. All of the deposits remain open at depth with high-grade ore chutes tracking in predictable plunge directions and the large untested gaps along strike between the known deposits represent immediate potential for new discoveries. During the quarter, digitalization and remodeling of decades of historical data identified several high-priority target areas laterally and down plunge. Drilling from surface is underway, in parallel with our assessment of options to restore historical underground access from the New Britannia shaft infrastructure, which provides the potential for accelerated access. All together, the Britannia Gold Project provides the opportunity to redevelop an underexplored past producing deposit with the potential to become a new anchor in a snow lake camp. Moving to Copper World on slide 13, we have taken a significant step towards establishing a major U.S. copper division. Together with our partner Mitsubishi, we announced the final investment decision to proceed with the construction and development of Copper World. This will be the next major copper mine in the United States and one of the largest open-pit copper mines in the country. First production is targeted for the second half of 2029, establishing HUD-based strategic footprint in the region. The final investment decision is supported by the robust economic returns with low capital intensity outlined in a definitive feasibility study which delivers average annual copper production of 102,000 tons over the first 10 years at attractive cash costs of $1.65 per pound of copper. The base case contemplates a 15-year mine life based on mineral reserves of 390 million tons and requires only state and local permits. The base case further optimizes the 2023 pre-feasibility mine plan with an in-pit crushing and conveying system in year four and an expansion of the concentrate from 60,000 tons per day to 90,000 tons per day in year five. The concentrator expansion enables a 43% increase in average annual copper production to 120,000 tons in year six to 10 compared to the first five years. The base case generates an after-tax net present value or NPV of $1.2 billion and an internal rate of return or IRR of 17% at a long-term copper price of $5 per pound. At a $6 copper price, the NPV increases to $2.3 billion and the IRR increases to 22%. The extension case contemplates a 37-year mine life utilizing only measured and indicated mineral resources and expands mining activities onto federal lands in year 10, subject to obtaining federal permits. It maintains annual copper production of 117,000 tons from years 11 to 20 and generates an after-tax NPV of $2.5 billion and an IRR of 19% at $5 per pound of copper. The extension case NPV increases to $4 billion, and the IRR increases to 24% at a copper price of $6. Copper World is anticipated to increase our consolidated annual copper production to approximately 250,000 tons, doubling our current production levels, and it is expected to deliver peer-leading low cash costs of $1.65 per pound over the first 10 years as summarized on slide 14 and 15. The initial growth capital of $2 billion includes approximately $200 million related to changes in project scope since the 2023 pre-feasibility study. We have put in place a prudent low leverage funding plan that will maximize risk-adjusted returns. Sources of capital include Mitsubishi's $600 million initial investment and Wheaton's $230 million stream deposit with the plan to put in place up to $650 million in project level debt financing representing less than 30% leverage. This defers HUD-BAY's first capital contribution to 2028 with our contribution expected to be roughly $500 million representing less than 25% of the initial growth capital. With this funding structure, the levered IRR to HUD-BAY increases to 32% of the base case at a $5 copper price Thank you for joining us. The Copper World project is expected to generate significant benefits for the community and local economy in Arizona through significant job creation, tax revenue, and economic development. The Copper World is expected to contribute more than $1.1 billion in U.S. taxes over the 15-year mine life in the base case and up to $3.7 billion over the 37-year mine life in the extension case. We expect to create more than 1,000 jobs during construction, over 500 permanent operating roles and up to 3,000 indirect employment opportunities at Copper World. Slide 16 benchmarks Copper World's capital intensity against peer projects and recently completed builds. The project maintains an attractive capital intensity of approximately $22.6,000 per annual ton of copper production, positioning it well relative to peers. What differentiates HUD-BAY is our track record of low risk, low capital intensity projects such as our Copper Mountain Optimization Project and our Constantia Greenfield project built more than a decade ago. We will leverage this proven track record of efficient mine building expertise and operational excellence to deliver our next major copper mine development in Copper World, followed by Cactus to build the third largest copper district in North America.

Concluding on slide 17,

Our focus on demonstrating continued operational excellence while prudently advancing our many organic growth opportunities will deliver significant copper production growth in the near term, medium term, and long term. Our portfolio of long-life assets in Tier 1 jurisdictions provides a strong foundation for growth. With brownfield investments at our operating mines in Peru, Manitoba, and British Columbia, We are expected to increase consolidated copper production by more than 25% starting next year. With the sanctioning of Copper World, our annual copper production will double to approximately 250,000 tons. And with the stage development of Cactus and Mason to follow, we have an attractive pathway to more than 500,000 tons of copper per year in the next decade. What sets Hyde Bay apart is its low risk Thank you for joining us today. and generate strong value for our stakeholders. We have the right assets, the right team and the financial strength to execute on our strategic plans as we continue to solidify our position as the premier America's focused copper producer. And with that, we are pleased to take questions.

Thank you. Ladies and gentlemen, we will now begin the question and answer session. To join the question queue, you may press star then 1 on your telephone keypad. You'll hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then 2. Our first question is from Richard Gargiatorina with Barclays. Please go ahead.

Great, thanks, and congrats on all the progress. My first question is on the outlook for 26 and into 27. Given you've maintained the production guidance for 26, pretty wide range for the fourth quarter. Maybe you could talk about where you think you could maybe come in at the high end versus the low end across each of your operations in 26 and how they are set up in terms of run rates as you exit Fourth quarter into 27.

Thanks, Richard. This is Peter. Thanks. Great question. Thanks for the kind words about the quarter. Eugene, do you want to comment a little bit upon the outlook? Yeah, thanks.

Thanks, Richard. We're pleased to reaffirm our production guidance for the year. We're tracking toward the midpoint of both copper and gold production. Pleased to have done that. And as you'll see that after three quarters, we're Approximately 75% through the production for the nine months and on track to meet that. As we look toward 2027, we're looking for increased production in copper. I think as Peter highlighted, the three-year stabilization and optimization program will be complete at Copper Mountain and we're looking to have about a 25% increase in consolidated copper production in 2027. We expect our gold production to be around the same levels given the strong outlook and performance that we've seen in our Manitoba operations and the stable operations that we've showed in Peru. With the brownfield enhancements, both the third rougher line and the pebble crushers in Peru, we're looking to increase throughput in in Peru in 2027, and that's going to, again, help us increase a little bit of that production in copper. So we're really pleased to reaffirm 2026 and 2027 looks even brighter for us.

Great. Thank you. And then maybe, sorry, go ahead.

No, I was going to say, Richard, just to add to what Eugene has said, that obviously in 2027, the biggest contributor to increased production will be BC, and cadence may tilt slightly towards H2.

Okay, got it. I appreciate that color. And then maybe just as a follow-up on COP World, congrats on the FID again. On the CapEx, I guess, with the initial growth CapEx of $2.07 billion includes $200 million in scope changes since the 2023 PFS. I was wondering if you could just give some color into what the scope changes are within that number and how that potentially could benefit in terms of and other capital synergies going forward as you develop Cactus and potentially Mason down the line.

Yeah, Richard, so the additional $200 million is pretty well no regrets changes to the scope. It's money that will be very, very well spent and would avoid significant downtime with respect to future expansion. So we've done a lot of preparatory work for a future expansion. that would minimize downtime, which otherwise would take the operation down for weeks or months at a time. The breakdown of the $200 million is roughly $40 million of mine development and earthwork adjustments. Then there's about $60 million for the concentrator capital, which includes primary crusher upgrades, some larger cyclone feed pumps, upgraded ball mill, space allocation for the larger grinding circuit, et cetera, that sort of thing. and then there's some $50 million included for enhancements to the tailing storage facility and then about $50 million or so in indirects. Great. Thank you.

The next question is from Oris Dworkadel with Scotiabank. Please go ahead.

Hi, good morning. A couple of questions on Copper Mountain, if I could. It sounds like the major repairs, or not repairs, upgrades were done in Q3. Can you give us an update on what performance is looking like from a throughput perspective here quarter to date in Q4? And then I'm wondering if when we think about 27 for Copper Mountain, the 50,000 tons a day, is that also sort of second half weighted and we should expect more of a ramp up? Thank you.

Yeah, Oris, it's Rob Carter here. I can take that. Yeah, let's just maybe just replay the quarter just a little bit, right? So the primary SAG was temporarily down for, you know, about 33 days in the quarter, right? So after that, we did see, call it month over month improvements on the ramp up. September was about 43,500 tons per day. Through that process, we really demonstrated what I call like sprint capacity, exceeding more than 50,000 tons per day in really several days there. However, really sustaining this run rate remains a little bit of a challenge for us. And really, the team is focused on operating maintenance and really stabilizing the grinding performance. And I guess I would say as well is that we're very confident that the mill remains on track to ramp up to its 50,000 tons per day going into the end of the year. We did have a little bit of planned maintenance and some ball mill liners as well as some screen decks and discharge grates that we kind of struggled with a little bit in October. And we really got the cadence here up at the beginning of November. And we truly believe that we got the right team, the mill's capable of producing this, and we will exit the year around 50,000 tons per day. And then when we, I think the second part of your question was around 2027. So we'll exit the year at 50,000 tons per day. We will continue that through all of 2027. And then I think maybe Eugene kind of highlighted a little bit. It is more back end weighted for grade, right? So North Pit finishes mining here in December. We're really back into pit three, and the really higher grade of 0.4% and 0.5% really comes in H2 2027. In saying that, though, we do have about 2.5 million tons of ore ahead of the crusher here right now, and we've never been in that position before.

Thank you. I appreciate that. If I could ask a follow-up, just in Peru and Constantia, The drill results you disclosed today, can you speak more about that in terms of the potential? And I'm just wondering, does this mean you potentially both extend or could extend the mine life, but also maybe maintain a higher level of copper production for longer than we previously thought?

Yeah, I can take that, Horace. I think you kind of hit it there, right? So I would say we're very excited. about the two exploration holes at Constantia. They intersect the really significant core lengths of mineralization in Abreccia. It's really extending the limits of the current resource at grades that you can see that are much higher than the current reserves that we're mining today. These intersections likely represent a potential new high-grade feeder system. Right, and that feeder system is really aligned with the main fault structure, like the Yannick fault, along the more southwest side of the pit. We've seen some positive reconciliations from mining along this structure due to uncovering really pockets of really high-grade scarn that were really not identified in the drilling. Yeah, and we got follow-up drilling. It's currently underway. I'd say with further positive assay results from this, we could expect to see an increase in our mineral resource update for Constantia next year. And I would say it will take a little bit more time to define the potential reserves and include it in the mine plan, but it definitely has the potential for really long-term production profile and to optimize the mine plan really post-2030 When the grade seems to naturally decrease so it'll really help it to prop it up and we're very excited about this.

Yeah, sounds very promising. Thanks for the update.

The next question is from George Edie with UBS. Please go ahead.

Hi, Tim. Thanks for the update as well. Just focusing on Copper Mountain a little bit more. So for next year, FY27, could you give us a bit of a steer of on-site costs here? Year-to-date, I think you're running at around 265 million annualised. How does this look next year? Is it sort of sideways or potentially lower? And then also maybe capex, thinking sort of 100 mil, is that sort of the right level as the stripping campaign wraps up there too?

Yeah, I can answer that. It's Rob Carter here. As we go into next year on a mining cost, obviously mining cost was slightly elevated in Q3. The unit cost, I think, was about $35, something like that. Obviously, there was a fair bit of planned maintenance. We had some higher diesel prices and some other equipment maintenance. But as we kind of go into Q4, things are starting to stabilize. So from a unit cost basis, we're roughly somewhere between $20 to $25, and we kind of expect that roughly to be next year as well. And then converting that to really a cash cost, next year is a very significant year for us on metal production. We will be doubling our metal production in 2027. The cash costs are in line with kind of low $2 type of cash costs, really per pound range.

Okay, thank you.

With capital coming in. There was a significant amount of capital for 2026, both in sustaining capital and the capitalized dripping. That program comes to an end. So you'll see the sustaining cash cost drop significantly to around that $3 per pound level.

And sorry, Eugene, what's total cap expended site, like 100 million all in? Is that sort of a best guess then?

That's a good ballpark. We haven't released 27 estimates yet, but yeah, it's a significant drop from well over 150 to around the 100 level.

Yeah, no, it's awesome. I mean, things look a lot better at Cop Mountain, so well done. Maybe just one last, Rob. Quarter this grade, like your comments before, 0.4, 0.5 second half next year, but is 0.3 around the right level today and sort of How do we think about first half? Is it sort of low point plays at best guess as well?

Yeah, so I think we're referring to grades here at Copper Mountain. I think our average grade in Q3 was about 0.27. Q4, we believe we're going to exit the year around about 0.3, 0.31. We'll likely maintain that 0.3 or just a little bit above for the majority really of the first half of next year. and then really move into the 0.4 and 0.5 and further takes us into those type of grades at the first half of 2028 as well.

Great. Thanks for that, guys. Appreciate it.

The next question is from Lawson Winder with Bank of America Merrill Lynch. Please go ahead.

Thanks very much, operator. Good morning, Peter and team, and thank you for today's update. If I could, I'd like to ask about just Copper World and the regulatory environment there. So just with respect to groundwater in Arizona, it was certainly a part of the Democratic platform in the midterms. And obviously, Copper World has its water permit and things are well underway. But can you just speak to water use at the project relative to industry standards and then The proportion of recycled water and how that project stacks up. And then similarly, are there any ongoing permits that are still outstanding needed as work proceeds on that project?

So we have all the permits required to extract groundwater sufficient for the base case at Copper World, as well as for the extension case. So we've completed drilling of wells to supply all of this water We've also voluntarily committed to recharge over 100% of the groundwater that we withdraw for Copper World. And we're using water source from outside the region as well. So we've done a bunch of storage in the interim and have actually complied with a significant piece of the commitment already. But we're planning to recharge 105% of the water that we use in the end. So we don't foresee any issues.

And then in terms of ongoing permits to proceed construction, do you have everything in hand that you could possibly need to get the project right through to commercial production?

We have all of the primary permits that we need to get through to commercial production. There are the odd little construction permits here and there that are required from local authorities and things, but in general, we have all of the permits in place to proceed with construction.

Okay, I understand. That's great. and then maybe putting the cart ahead of the horse just a little bit here, but the model for Copper World here was to get the project well along to, or at least close to a sanctioning decision and then finalize a partnership for that. I mean, when you think about Cactus and Mason, is that type of partnership profile something that you guys would consider with those assets? Yeah, I guess I'll just leave the question there.

In general, the base case for CACTUS is we have the capacity to be able to fund it ourselves. So for the next couple of years, in any case, we're looking at spending about $30 million a year concluding the studies, the study work that we need to do in the PFS side and the DFS side. We have no plans at the moment to enter into a JV, but it certainly is something that we could consider in the future depending on Thank you, Peter.

The next question is from Charles E. Dinan with Jefferies. Please go ahead.

Yeah, thank you for taking my question. So I'm asking on behalf of FAAD. So maybe my first question is on the LSIP judicial review. Can you clarify the specific grounds of the challenge and the remedy being sought? I mean, I appreciate that you remain confident that the permits would be upheld, but if for any reason the court doesn't rule in your favor, what's the realistic downside here Is there like a potential delay to 2028 first production or permit amendments? Just any call on that would be helpful.

Yeah, I can answer that Charles. It's Rob here. So the Lower Similkham Indian Band filed an application for judicial review in March of 2026. This is really regarding the provincial government's administrative decision. really to issue the permit amendment and really the consultation process. So HUD-B is participating in this process, and we're supporting the province's regulatory process really as well. So the permit remains in effect today. We've got active dialogue with LSIB and upper Similkham Indian Band as well. as part of our participation agreement mechanisms. Construction activities continue to advance, and we remain confident in the regulatory process. And we really expect the court to uphold that decision at a hearing that's anticipated in the first quarter of next year. So like I said, we maintain an active relationship. We're engaged constructively having Our mechanisms that we have is our participation agreement as part of our joint committees that we have with upper and lower. And yeah, we believe the process will be upheld.

Okay, thank you. Just second question on the copper world. Yeah, I think there was some news recently about the Senate advancing the Permitting Reform Bill. I'm just curious if this change, whether this change could Thank you very much. Thank you very much. Thank you very much.

With respect to advancing phase two at the time, but we have plenty, plenty time in order to be able to advance phase two. And if you look at precedent, other companies who have received permits to expand onto, three companies have received permits to expand onto federal land for expansion phases, the typical amount of time taken is about four years. So we're not considering expanding onto private land for quite a while, so we have plenty of time ahead of us. So there is no real impact of this legislation, although we think if it passes in its current form, it will be marginally positive for the project going down the road.

Okay. Yeah, thank you. That's all I have.

The next question is from Martin Pradier with Veritas. Please go ahead.

I have two questions. The first one is on Chile and a little bit, you know, you're installing the people crashers, would be a lot of downtime in the quarter. Does this have a ramp up time or is quick once it is installed? And then the last thing on that one is some update on the satellite deposits that you have been talking about in the past. And in terms of Copperworld, you know, how much of the workforce has been mobilized and when does the construction start and if you have the equipment on site to start construction?

So the first question was with respect to pebble crushers in Peru. We expect to commission those this month. We don't expect there to be any downtime associated with the commissioning because you're literally just turning on a switch and feeding into the milling circuit. And we expect the contribution of those pebble crushers to be in place before the end of the year. On the satellite deposits, You heard we spoke a little bit about the drilling success that we've had in the Constantia pit itself. So that, on the one hand, is a further source of potential production post-2030. On Maria Reina and Caballito, we are still going through the permitting process. We still do not have the prior consultation permits in hand, and those are unlikely to be touched during the remainder of this year while local elections are underway Once local elections are underway, we'll get back to it and we should have an update on that sometime later on next year. Your third question with respect to Copper World and the workforce. So from an operating perspective or from the operating company, we have roughly 180 We have made commitments on the trucks that we require or the trucking fleet that we require. And then with progress itself in the field, we are in the process of installing the water pipeline. We have all of that material on site right now. I think we're about 60% complete with the water pipeline. So things are underway. We will ramp up the construction workforce as is required and reflected in the construction schedule. We've seen no problems doing that so far.

The next question is from Anita Soni with CIBC World Markets. Please go ahead.

Good morning, and thanks for taking my questions. And thank you for all the color that you provided on operating outlook for each of the assets. If I could ask about recovery rates, starting with Peru. I'm wondering how recovery rates will look in Q4 and 2027 for copper recovery.

Yeah, I can answer that, Anita. Yeah, I think Peter kind of touched on a little bit in the discussion earlier on about the third rougher flotation line. So that came in place or was commissioned roughly in September, and we immediately saw about a 2% uplift from the recovery model that we were predicting. So we've continued to take that through in October. We've seen some pretty good recoveries kind of in the mid 80% range, right? And then along with that, right? So helping us through on the capacity side of things as we, you know, complete our ramp up this year to achieve approximately like 93,000 tons per day going into next year, right? We got 34 million tons per annum. The pebble crushers are going to help further kind of support that. And we believe we're going to be roughly in from a recovery basis. Really around that 84% to 85% recovery.

All right. Yeah, that's what I was driving at because I think that's what I have in my model. And I'll just keep through with a little light. And then just going to, I see a similar question in terms of the recovery rate profile. Now that you're looking to exit the year at higher processing rates, how would that impact the recovery rate?

Yeah, like let's talk maybe just a little bit about it. I think we had the quarter was roughly 79 or 80% kind of on recovery. Obviously, those can fluctuate with the differing ore types. I talked a little bit earlier is that there's some ore that's coming in from North Pit, it's a little bit softer, right? A little bit of different recovery metrics from that than really from really Pit 3. All right, so we expect to be in very similar range for recoveries in Q4. And as we enter next year, I think everybody notices recovery grade models, the grade increases, generally recovery increases there as well. So we're looking at somewhere for budgeting, somewhere between about 81 to 83% recoveries for next year.

And then just lastly, on the gold side of the equation in Peru, I noticed you still have your guidance of 15 to 20,000 ounces, but I think you're almost there. So is there a reason why you just kept the gold guidance where it's at? It looks like you'll probably exceed it, or is it just not material enough for you to worry about?

Yeah, I don't know. Maybe it's too material. I can kind of maybe answer that maybe a little quicker. Obviously, we're very pleased with the... with the gold performance really year to date. And as of October month end, we have already exceeded the top end of the guidance for gold. Okay.

So no reason to expect any kind of change from your state performance on gold?

No.

Okay. All right. Thank you. That's it for my questions.

The next question is from Rodrigo Gotargo from BTG Pactual. Please go ahead.

Good morning, Peter and Tim. Thanks for the opportunity. I have two questions on my side. First one, it's on regards to capital allocation. So we now see that they're in a very comfortable net cash position. And despite having all these Attractive growth projects ahead. We see Head Bay well positioned to fund this growth pipeline, especially with the structure on Copper Road and so. So, given the support is balance sheet and the support is metal prices, do you see room for some opportunity M&A? If yes, do you have some preferences for commodities or jurisdictions? Also on this capital allocation profile, Do you see some room for more meaningful shareholder remuneration given all these supportive backgrounds? That's my first question.

Hi, Rodrigo. It's Peter. Thanks for the question. Look, I think that, as you know, we have an attractive pipeline of high return brownfield and greenfield opportunities, and we are focused on allocating capital to the highest risk-adjusted return opportunities. As you indicate, the strength of the balance sheet plus the proceeds from the JV transaction positions us very well to continue to allocate capital to advance these high-quality organic initiatives and to create value. On the inorganic side, what I would say is that we continue to look for opportunities that meet our very, very stringent criteria. We've got a very skilled team when it comes to highly efficient operations and world-class development projects. But our strategy hasn't changed, and we'll continue to be disciplined as we evaluate assets that fit our strategic and financial criteria. We know that copper assets are scarce. We would only pursue opportunities that are accretive and value-creating for shareholders. So yeah, it's very, very difficult to find these things, but we certainly continue to look. And if something came up that met those criteria, we would certainly consider it. Our focus would be entirely on copper, though.

And then Rodrigo, it's Eugene Lee here. With respect to capital returns, as Peter highlighted, we have a very holistic Capital allocation framework that allows us to allocate capital to highest risk adjusted returns. And this allows us to not only develop the copper world with low leverage without the requirement for hedging and to put the balance sheet at risk while making generational investments in the brownfields projects across our entire platform. We're in a privileged position to be able to also reduce debt and target a net debt to EBITDA level below one times throughout this development cycle. We think this is a low risk way for us to have prudent growth, balanced growth, and we expect to continue to do so. As we look forward into 2027, we expect strong free cash flow generation from our three operating assets. We have some growth capital ahead of us in terms of Copper World and advancing both brownfield projects in Manitoba and Peru and BC, but also advancing Mason and Cactus, the recently acquired project. And so I think that is our focus. But as we have excess cash flow and no lack of opportunity, we'll look at shareholder returns. You will notice that we had increased our dividend earlier this year for the first time in HeadBase history and that's with an eye to long-term sustainable returns to shareholders and we're beginning to be able to look at that at the same time as allocating capital to our projects and so I think this is a prudent way to advance a company and grow the company and we look forward to being a sustainable Thank you, gentlemen. My second question goes in regards to the other two projects.

So, we now expect the PFS contractors in Maiden in the second half of next year. So could you share first how is it advancing some of your findings on this project, especially how do you see these current findings on the studies versus the previous numbers published on the technical reports? Thank you, guys.

Thank you for your question. We're really pleased with our acquisition of CAPTUS and our due diligence findings. prior to acquisition have proven to be consistent with what we've seen with the project and the team three months into ownership. We are running trade-off studies on a number of the assumptions that we had made and also doing some tollgate work on a lot of the feasibility work that the team has advanced. So all this comes together into an updated HUD-Bay pre-feasibility study for the project. We're well underway on that. I think there's over 16 trade-off studies we're doing there and we're excited to move that project forward. The timeline for that is to issue a pre-feasibility study in the third quarter next year and then move into a feasibility study that'll take roughly a year with some of those opportunities More fleshed out for potential FID by the end of 2028. And that is the target for CACTUS and we're really on track with that and building the team. And building the team, taking some of the team members who had been doing sort of the technical work and engineering work at at Copper World and applying them to Cactus, but also building out an independent team at Cactus so that it's ready for FID in about a year and a half's time. At the same time, with a totally separate team, we're advancing the Mason Project in Nevada, and that pre-feasibility study is now about 47% complete. We're really excited to have another option for our growth in the United States, and we're really refreshing the study that was last done in 2021 and taking into account a lot of the lessons that we've learned as we've gone through the full PEA to feasibility process with Copper World. We're building out a very significant U.S. regional team that's going to support all three of the projects and really be a cornerstone of HUD-based growth for the next decade.

Okay, that's clear. Thank you, gentlemen. Thank you.

This concludes the question and answer session. I'd like to turn the conference back over to Candace Brule for any closing remarks.

Thank you, operator, and thank you everyone for joining us today. If you have any further questions, please feel free to reach out to our investor relations team. Thanks and have a great day.

This brings to a close today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.