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Thank you for standing by. This is the conference operator. Welcome to the Electra year-end 2023 Results Conference Call. [Operator Instructions] The conference is being recorded. [Operator Instructions] I would now like to turn the conference over to Heather Smiles, Vice President, Investor Relations and Corporate Development with Electra Battery Materials Corporation. Please go ahead.

Thank you, operator. Good morning, everyone, and thank you for joining us. First, we'll see housekeeping matters. This presentation includes forward-looking information and forward-looking statements. Please see Slide 2 for clarification on what that entails. All of our fourth quarter disclosure materials are available on our website and SEDAR+, and today's presentation is also available on our website. For those who don't know me, my name is Heather Smiles, and I oversee the Investor Relations and corporate development programs for Electra. I rejoined the Electra team in January of this year, and I previously worked for Electra from 2017 to 2019 and spent the last several years with Baffinland Iron Mines here in Canada, leading their stakeholder relations program. Our presenters today are 2 familiar faces, our CEO, Trent Mell; and our Vice President, Project Development, Mark Trevisiol as well as another new member of the team, our CFO, David Allen. Dave joined Electra at the New Year as well and has more than 30 years of finance experience, spanning manufacturing, natural resources, shipping, real estate and financial services industries. He has held CFO and senior finance roles with companies such as Algoma and Canada Goose. Now, I'll turn it over to Trent.

Thank you, Heather, and good morning, everybody. And I should say, I guess, Heather, welcome back to the team and Dave, welcome to the team. It's been really enjoyable working with the 2 of you over the last few months. So I'll start with some highlights on what we've been doing through 2024 before handing baton over to Dave and then Mark. Summary, just some of our activities. 2023, towards the beginning of the year, you'll recall, we focused on the rebaseline exercise. So that was basically to do a reassessment post inflation of what the completion schedule and capital cost would look like to complete the refinery. Brownfield expansion plus construction. So depending on the metric where we're quite advanced with permits in place, still works done buildings, equipment there, did that exercise. And then in tandem with that, we started what we believe was the Continent's first plant-scale demonstration plant for the refining of black mass, Mark will talk a lot about that. And that took up a good part of the year and allowed us to take advantage of the gap in construction by recommissioning the front end of the Brownfield site that we've got. In tandem with that, we spent a lot of time, especially myself, working on the funding gap. I'll come back to that a little bit later, making great progress there, as I indicated in Q3 and then strengthening the balance sheet myself, Dave and others. We extended the maturity of our debt. We, in Q1, I guess, announced a $5 million grant from federal government as kind of a bridge to and to a bigger solution. Made amendments to our debt facility to minimize potential dilutive impact of the notes. And all said and done, we're getting closer and closer to our goal here, which is, of course, to complete construction and make our way into production as we spent a lot of 2023 just laying the groundwork for that environment to occur [indiscernible] that may come out of the gates stronger when we do get back to work. So as you can see in slide 4, a number of commercial pieces as well were announced through the year. Quite recently, we announced a feedstock agreement with Eurasian Resources Group. Incidentally, that's where our VP Commercial worked prior to joining Electra. And that's one of the biggest cobalt miners in the world and delighted to have them as a supplier for our refinery. Also, earlier in the year, strengthened the relationship with LG Energy Solution on the offtake by expense [indiscernible] the term and the quantum of the material they're going to be buying for us upon production. And then we've advanced and continued to advance the strategy with the Three Fires Group. I'll come back to that as well. But Basically, it's an indigenous economic development group in Southern Ontario with some shared values around closing the loop on the battery supply chain through recycling. Plant scale, and I'll defer it to Mark on that, but bottom line, our journey here to produce IRA-compliant onshore North American battery materials continues unabated, some good progress, more to come. But before we get into that any further, let's go to Dave first, and he'll review the financial highlights for Q4. Dave?

Thanks, Trent. Good morning, everyone. I'll ask everyone to turn to Slide 6. At the end of Q4, we held $8.2 million in cash and marketable securities. This is down from $15.7 million held at the end of the previous quarter. This was driven by capital costs related to construction of the refinery and costs related to running our black mass trial. I should mention that our cash balance at the end of the year does not include $5 million of new government commitments announced in February nor the $5.1 million of previous government commitments not yet received. Cash management remains a key priority, and we continue to take steps to minimize costs and manage expenses. Reductions in operating activities included significant reductions on exploration activity at the Iron Creek site, seeing general and administrative costs at the head office and reducing activities at the refinery to focus on the lower cost black mass trial. This was partially offset by higher professional and consulting fees incurred during financing activities associated with the capital raise in Q3 and [indiscernible] of the debt, the convertible notes, in December. Turning to slide 7 for more detail on the restructuring of debt. In February 2023, Electra closed a private placement of USD 51 million of the 8.99% senior secured convertible notes that are due in February of 2028, canceling the USD 37 million in previously held debt in 2026. The company received net proceeds of USD 13.7 million. In December 2023, we announced proposed amendments to the agreement with noteholders to more closely align with market conditions, those were completed in the first quarter of 2024. Conversion price of the warrants was adjusted and an acceleration clause added and in partial consideration, the holders agreed not to exercise certain adjustment provisions. These amendments, which were finalized in early 2024, have the overall benefit of reducing the potential dilution should the notes be converted to capital. We are grateful for the support and partnership shown by the noteholders as we continue to advance the project finance. It concludes my remarks, I will hand the call over to Mark for an update on our refinery project.

Okay. Thanks, Dave. So everyone can turn to Slide 9. We talk health and safety every day in the plant. And it is our top priority. We'd like to believe that we walk the talk when it comes to the results of our plant and with regards to health and safety. And over the last 2 years, Electra employees have worked over 80,000 hours, and we've had 0 lost time incidents. Our target was 0 lost time. So it's something that we're fairly proud of and something that we -- again, we review on a daily basis at site. With regard to the project, you can see the pictures here that -- what the site looked like in 2022 and what it looks like now. We've added about 60,000 square feet of plant to our existing 45,000 square feet of existing plant. We have over 600 acres of land and the asset life is good for decades going forward. There's been a lot of work. We believe the sites are roughly about 40% constructed. Most of the buildings that we need for the cobalt sulfate project are all in place and the majority of the infrastructure is there. And we've got the power -- all the power lines updated and to the rates that we need. We've got all the pipelines installed. So now it's mainly working on the internals of the plant, putting piping, putting electrics, putting instrumentation and controls in place. Next slide, slide 11, just shows you a view of our crystallizer plant on the left foreground. And then in the background is our new 40,000 square foot solvent extraction plant and to the immediate right is our sulfate warehouse, and that's where our final product is going to be stored before it's shipped off-site. I mean the highlight of this plant is that we've built it and licensed it for 5,000 tonnes per annum. But with a small incremental cost of capital at the beginning of about $600,000 to $700,000, we can bump this plant up to 6,500 tonnes per annum of cobalt and cobalt sulfate and that would include a permitting process with ministries of Mines and Ministry of Environment, but that is well within reach. So that's a significant upside for us, both on servicing our customers and on the margins that it brings to our company. Black mass update. Did a lot of work on black mass over the last number of months as Trent has alluded to. The recovery rates -- so I'm on Slide 13, the recovery rates for metals of lithium, nickel and cobalt, graphite have greatly improved since the start, and some recoveries are actually higher than what we had in the bench-scale test when we got this whole process laid out at SGS Labs in Peterborough. We put about 40 tonnes of black mass through the plant. And we produced about 28 tonnes of nickel-cobalt MHP, which we shipped to our customer. It's mainly all going to the Glencore right now. And over the next couple of months, we'll probably ship another 20 or so tonnes of MHP product. Our lithium carbonate product is now approaching technical grade. This wasn't as much of a focal point when we started the project, but as we all see the price of lithium and lithium carbonate extremely escalated since we started doing bench test and now we're up to 97%, 96% lithium carbonate, which is a significant achievement for us. Right now, we're not putting through any new black mass into the plant, but we're working on the recycled washates that were part of the process of making the MHP product and lithium carbonate product and concentrating those washates up to then produce finished products again of lithium and MHP nickel cobalt. We're very proud of what we've achieved here with what we started with. We've had some batches of nickel-cobalt MHP approaching 50% nickel plus cobalt. So it's quite a high-value intermediate product. Slide 14, some next steps for black mass. There are some optimization areas that we've seen when we've run the pilot plant or the demonstration plant in our existing refinery. And we're addressing those going forward. And we're also -- the cobalt business is a little bit unlike copper and nickel and zinc where an intermediate product -- you can get a significant part of the London Metal Exchange price for your product, but not in the cobalt business, just because processing plants worldwide aren't really tuned to take those products and recover high-value cobalt. So the way we can maximize more profit to the company is to produce a cobalt product that is LME grade, and that's what our target is -- is to get up to 99.9%, 99.5% cobalt product. What you see there on the right is the separation of nickel and cobalt with cobalt being on the top, blue colored in that bench-scale test that you see there. And we've been managing to get almost 99.99% separation and extraction. So a critical step for us moving forward. And as well, we are also in discussions with a few funding agencies on helping us to develop this further. And as Trent had mentioned, we would like to be and stay in the recycling business and feed supply is so critical. And that's where the Three Fires Group, the memorandum of understanding comes in. Three Fires has got territorial rights in Southwestern Ontario, on the lands, and we look forward to building that relationship and securing a supply of recycled lithium-ion batteries to our process. I think I will now turn this back over to Trent for some closing remarks.

Sorry, everybody. I tried to unmute and pressed a little red button as I did so. So apologize for the gap. Look, I think as we kind of highlight on slide, where am I, 16 here, some of our partnerships -- before I go there, I just want to highlight one of the things Mark said, maybe some of you caught it, but when he talks about LME-grade cobalt, I mean one of the new opportunities we're looking at through black mass is not just cobalt sulfate, but can the separation of MHP also allow us to produce the cobalt metal, that would be exciting, to have that optionality and it's a traders dream to be able to trade cobalt sulfate or cobalt metal depending on which way the winds are blowing and how commodities are trading. So stay tuned on that. We have the option to bleed cobalt from black mass into our cobalt sulfate plant, but to have a separate circuit that could produce standard-grade metal product could be very, very interesting. So we'll have more on that. So yes, slide 16, just wanted to highlight some of our partnerships. I touched on this a little bit earlier, but the journey we're on, our long-term shareholders would know, is to produce IRA compliance, so that's Inflation Reduction Act U.S. compliant cobalt sulfate for the battery supply chain. Why? Because more than 80% of battery-grade cobalt today comes out of China. And if you look at the 30D credits in the U.S., so that's the $7,500 vehicle credit. Starting next year, you can't have any material coming out of China or you lose that credit, though it's a small market for anybody looking to sell IRA compliant material into the U.S. And moreover, we saw the tariffs this week and the Biden administration sent a further signaling that the policy intention [indiscernible] 25% tariff on batteries, 100% on vehicles. And Electra, I would like to think we're the poster child of what onshoring should look like, right, our entire focus is on the North American market. So these partnerships you see here underscore that. The feedstock we have in place now, not just with Glencore, which goes back to a few years than ERG. We've locked up the 2 largest non-Chinese cobalt miners in the world, both of whom have top-notch ESG practices, tracing IRA compliant materials, so the ethical mining practices are -- their operations are what you would see in the Western world and what you would expect. And with the 2 of them, we pretty much have all of our supply locked up for the foreseeable future. LG continues to be a great partner. They're going to buy up to 80% of our production, now up from 60%. They're going to buy 19,000 tonnes over 5 years, which is a big increase if you guided 2 years to when we're running at full capacity. So the remaining 20% has been bid, if you will, several times over, our entire book, if you will, of expressed demand to our future production is about 2x what we would expect to produce as IRA is a big help. We're not in a rush to sign up that 20%. We've got some conversations ongoing. But I think time is on our side and we'd be wise to use that leverage to our advantage. What else have I got? I guess, the Three Fires piece -- maybe just probably [indiscernible] go away from LG, an important consideration when you look at where the markets are today. Nickel has been under pressure and lithium and cobalt. And that's just the cycle. It's just the nature of the market we're in and some of the geopolitical pressures perhaps magnifying that. We structured our contract with LG to be, you could say a toll, but it's a toll like, I guess, we've got -- basically, you just don't lose money. It's a margin-based contract to remove some of that volatility. So the peaks and troughs are out of the way. We're true partners. And the whole point here is that if we run an efficient operation, then we're going to make money quarter-over-quarter and not risk our balance sheet. The Three Fires. Yes, Mark touched on it. It's about the closed loop. If we've got the refining operation up and running into [indiscernible] source, then we need to get our hands on the material, and the most efficient way to do that, and again, to protect the margins, is to have our own supply, our own primary recycling facility or a shredder as it's better known, and Three Fires with some cell plants in their traditional territories and other feed opportunities beyond. We think they're perfect partners to help us set that up, both from a funding perspective from land and permitting with us providing all the commercial and technical expertise. So with that, if I turn now to the next slide, slide 17, catalysts that are upcoming. '23 is challenging. Of course, as we all know. '24, I think we're looking -- I'm feeling very good [indiscernible] my mood from Q3 to Q4 hasn't changed, if anything, it got more buoyant. I think -- one thing I'll give the team credit for is we were one of the first projects to pause, right, post inflation, and it seems like a distant memory, but we took an early decision to slow things down. And I'm hoping we'll be one of the earlier ones to come back as well. And it's not just the start-ups, OEMs as well, right, cell plants, battery plants were delayed. But the trend is clear. I mean, we can't look at this quarter to quarter. We're building a global supply chain, it's a multiyear process. So some of the alleged headwinds that we saw in Q1 reports, I don't think we can put too much weight on that in terms of where the business is going. So '23, also we spent a lot of time as we outlined in mitigating some of the uncertainty. We strengthened our balance sheet. We reduced our costs. And I think we're in a pretty good place now to come out stronger and to compete. And so a recap from past quarters, we require roughly USD 60 million. And that's just the construction piece to get us to a point we can start commissioning. And again, to reiterate, the focus here is on nondilutive funding solutions, government, industry, strategic partners and I feel that's starting to take shape. Near term, we're going to keep working on the optimization of the black mass that Mark spoke to, and then we're awaiting some decisions from some of our partners that will allow us to come to the market with some funding ideas. And then once we've got construction of the cobalt plant at hand, we do have pipeline opportunities, there's the expansion of the plant itself, this black mass. There's the [indiscernible] LOI that we've got in [indiscernible] Quebec to build a facility there or somewhere in the province. And we've also taken some early steps with some inbound interest on what a nickel sulfate refinery might look like somewhere in North America. So that is a summary of the quarter. Thank you for dialing in, and I'll now open the call to any questions for analysts.

[Operator Instructions] There appear to be no questions. So I'd like to turn the conference back over to Heather Smiles for any closing remarks.

Thank you, operator. And thank you, everyone listening, for your time today. We appreciate you taking the time to listen to our update. And as a team, we're really looking forward to the next opportunity we have to bring you an update on our progress. Thank you so much, 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.

Thank you for standing by. This is the conference operator. Welcome to the Electra Third Quarter 2023 Results Conference Call. [Operator Instructions] The conference is being recorded. I would now like to turn the conference over to Joe Racanelli, Vice President, Investor Relations with Electra Battery Materials Corporation. Please go ahead.

Thank you, Galine, and good morning, everyone. Thank you for joining us today for our Q3 call. We do have quite a bit of material to go through before I turn it over to Trent. I want to point out a couple of things. All of our disclosure material related to our Q3 results, including the MD&A, financial statements and the press release were issued last night. They've been filed on SEDAR and they're also available on our website. We will be making use of a presentation today. That presentation is on our website, and I encourage you to follow along. I do want to make note that we will be making some forward-looking statements under the meaning of safe harbor. And as well, I want to point out that we will have a Q&A session today that will be open to the analysts who do follow us. For any shareholders that would have additional questions. Please reach out to me at any time. And so with that, I do want to point out that in addition to Trent Mell as CEO; we do have Peter Park, our CFO, on the line with us; as well as Mark Trevisiol, who is our VP of Project Development. So with that, let me turn it over to Trent for his opening remarks.

Thank you, Joe. Good morning, everybody. So yes, I'll start. Peter will say a few words, then Mark, I will wrap up before we open the call up to questions from our analysts. So over the past quarter, since completing the re-baseline engineering report on our cobalt refinery, we've been particularly focused on our capital, our balance sheet, strengthening the balance sheet in 2 ways: one, despite some pretty tough markets and uncertainty, that hopefully -- that peaked, at least in regards to inflation, we did get pretty strong support, raising CAD 21.5 million in the month of August to support our efforts and energy proceeds. In addition to that, over the quarter, we -- I think we received some real encouragement from sources for nondilutive financing that could get us to USD 60 million amount that we're going to need to complete our refinery, so some great progress there. I can't say much about the latter part, but we can come back to it if we like. On the other developments listed here, we're going to go through these, so I won't dwell on it too much. But Slide 4 here talks about the black mass trial, that Mark will go into some detail about, Three Fires and formalizing or advancing our joint venture. I'll come back to that at the end. And then this partnership, commercial relationship with LG, cornerstone partner, that now is a really, really great partner for us as well. So before we elaborate on all that, so why don't we go to Peter, and he will review our liquidity and talk about Q3 highlights.

Thank you, Trent. Good morning, everyone. I would like to begin my remarks with a review of our liquidity position found on Slide 6. At the end of Q3, we held $15.7 million in cash and marketable securities. This was up from $7.4 million held at the end of Q2. The increase was driven by our equity financing that generated gross proceeds of $21.5 million, but offset by capital costs related to the construction of the refinery project and costs related to the running of our black mass trial. I should point out that our cash balance at the end of Q3 did not include the remaining $5.1 million of government investments expected to be received. Cash management remains a key priority, and we have undertaken a number of steps to reduce the costs and manage expenses since the start of the year. Among these include a reduction of the owner's team to 12 individuals from 30 we had at the end of 2022, reducing G&A costs at the head office and limiting the use of consultants and advisers. There are a couple of other financial highlights of Q3 that I would like to bring to everyone's attention, as noted on Slide 7. Our net loss for the period was $9.2 million, of which $4.4 million was due to fair value adjustments relating to our convertible notes. The adjustments are financial in nature and noncash. I also want to point out that our financial statements for Q3 included a reclassification of our convertible notes from long-term to current liabilities due to the timing of the waiver received from our lenders relating to our registration statement, allowing for the resale of the underlying securities not yet being completed. The waiver has been received subsequent to quarter end, and as a result, the liabilities associated with the convertible notes are now classified as long term. The delay in the receipt of the waiver, unfortunately, had a bearing on our reporting time line. That concludes my remarks. I will now turn the call over to Mark for an update on our refinery project.

Thanks, Peter. Let's skip up to Slide 9. Although our efforts at the refinery in Q3 were primarily spent on conducting our black mass trials. Some gains were made on our cobalt sulfate project as well. Just recapping what our site looked like about 2 years ago. Slide 9 shows our site back in June of 2021. The subsequent slide, Slide 10, if we go to that, shows some of the construction that has happened in the time period as this fall of 2023. And so you can see there's an extensive amount of work that has been completed, a lot of work around solvent extraction and crystallization. So the most noteworthy of this is the white building, which is a solvent extraction plant up in the right-hand corner. Once fully commissioned, this building will be where we will be separating the majority of the impurities of our feed and making better than 99.99% pure battery-grade cobalt sulfate solution. And that solution would then get crystallized as what we would call the final heptahydrate cobalt sulfate powder. You can see from the slide, all of the shell of that big white billing is completed. So things such as the footing, the foundations, the roofing, not so visible as the inside of the building, obviously. but there's over 33 solvent extraction cells that have been placed within the building and -- as well as some accompanying holding vessels. Also noteworthy is the completed work on the crystallizer circuit, and we'll be talking about that in the next slide. So Slide 11 shows a nice view of the crystallizer. In this circuit, we'll be essentially taking installment from the cobalt solvent extraction circuits of the cobalt sulfate. It's basically getting vaporized in the falling film evaporator and then being crystallized within the crystallizer. I should point out that the crystallizer circuit contains the falling film evaporator, and that was the vessel that we put out an announcement on a number of months back that was damaged during shipping. And you can see the top of that vessel on the left-hand side is just protruding through the roof. And then right in front is the main crystallizer vessel, which stretches about 50 feet long and about 8 feet in diameter. Some recent activities around the cobalt sulfate project. We've received a number of longer lead items. This includes -- again, most of it is around the solvent extraction plant. A lot of these vessels were manufactured overseas. There was a number of delays in getting them here, not only getting them here, but getting them fabricated. We finally got the final shipment back in September, so we're happy that all of that equipment is here. But there's still some equipment that we're waiting on the electrical side that has to come to site. And that should be at site within the next 6 weeks or so. And again, I mean finishing the installation of the equipment delivered at site will occur as we secure capital funding for the project. And some of these numbers you've seen before. The updated project costs are in the range of USD 113 million to USD 122 million. And the current estimate to complete is around USD 55 million to USD 62 million. So we've done the re-baseline engineering. The report was done by an EPCM contractor. The estimate in that report, a cost estimate was reviewed by a third-party estimator. A number of areas driving costs. We see inflation at our grocery store of 5%, 7%, 8%. On the industrial side, when you're talking steel, when you're talking stainless steel, some concrete piping, valving, we've seen as much as 50% increases in cost. And that was something that was just not projected. And many -- most of it linked -- a lot of it linked to the COVID-19 pandemic. But we'd like to add that the updated project economics has significantly derisked the refinery project. So our next steps, again, work on project funding and try to make it as nondilutive as we can, continue to receive some items at site. As I mentioned, some electrical components are still yet to come to site. And we'll continue with the black mass recycling trial. And just on black mass, a quick update. Slide 16. We extended the recycling trial through to Q4. The goals are to test the hydromet process, which we developed in-house and target the recovery of high-value metals such as nickel, cobalt, lithium. Those are the higher value meals. We're also recovering manganese and graphite. Critical success factors for the trial, number one, it's got to be safe; and it's got to be environmentally compliant with all the rules that we operate under within Ontario. We're aiming to maximize our recovery rates. I'm going to touch on that shortly. We've made some great gains there and determine the throughput rate that we need for economic viability. So some -- on Slide 17, some of the results that we've had in the trial. Recovery rates for some individual processing steps are at or superior to the results that we've achieved in the lab setting. We've especially seen this on our manganese recoveries within the last number of months. And we've also seen this in terms of the product grade and recovery rates for nickel and for cobalt. So the MHP product that we're making, the grade of the product is exceeding what we got in the lab. We are now touching on nearly 50% nickel plus cobalt in our MHD product. And a number of the impurities have significantly dropped, impurities that would maybe not be an issue to us, but more for a downstream refiner, such as fluoride, manganese, copper. We've seen significant orders of magnitude drops in that. And we've been able to do that by running the batches in the plant and tweaking reagent addition, tweaking retention times, temperature, a few tools at our disposal that we've managed to work with to get these improvements. So we've treated about 40 tonnes of black mass, and we shipped about 20 tonnes of nickel, cobalt, MHP to date. And we are recovering lithium carbonate. It's a significant element used in making batteries, and we continue to work to refine that to a higher grade product. And as I mentioned, we've made significant improvements on manganese recoveries with chloride reductions. Our next steps, we'll continue to work away at optimizing the hydromet process, improving product security levels and recoveries and reducing moisture levels. Optimization involves working with what we call a METSIM model, which is a metallurgical model that looks at the mass balance and the heat balance and allows us to move around our process flow diagrams accordingly to try to maximize how the process works. And we're going to study the cost to make an LME-grade cobalt and an industrial-grade lithium carbonate. We can see that the added value that is generated by having greater payable is significant in this business, so we'd like to explore that a little bit more. We're working on a final summary report on what we did at site and the work that has been done and all the data that's been gathered and, again, look at a path to commercialization and how that fits into the work that we're doing with Three Fires and trying to make an integrated recycling business plan. I'll now turn the call back over to Trent for some closing remarks.

Thanks for that, Mark. Before I go to Page 20, I do want to pause and congratulate Mark and the team. So George, Hayden, the folks at site and the commercial support from Michael and Andre. What we are doing there at site on the recycling, with the benefit of a permitted facility that -- with a world-class lab, the team and the existing refinery that's being recommissioned, we're in a class of one here in North America. A lot of people are talking about it. This team is doing it. And I'm really proud of what we've accomplished, plant scale, no less. And I think our approach is being rewarded. We're making a quality MHP, and it keeps getting better. The same thing with the lithium carbonate, we've learned a lot. We'll make some capital investments to make that even better. And the reason we're still doing this 11 months later is because we keep learning and benefiting from the growing experience of the team there, so hats off. Now on Slide 20, let's turn to a couple of the strategic initiatives that we're working on. There are a bunch, 2 of note 1, of course, is LG. So if we look back to September of '22, that's when we initially had the signing ceremony for a binding term sheet that basically provided for 60% of our production going to LG over a 3-year period. And even in the face of some delays with the inflation that, frankly, the entire industry has faced, LG was keen to work with us and to extend the contract because the need for cobalt is not today. It's really '25 onward, right, as the supply chain really picks up, and these battery plants are installed. Let's not forget LG, second largest battery maker in the world, the largest outside of China. They are building one plant in Europe, but they're building 6 battery plants with partners here in North America. So this is an important market for them. 5-year contracts from 3, 19,000 tonnes of cobalt over that period. So that's going to be up to 80% of our production and more than a 2.5x increase in the total volume under contract from our initial announcement the year prior. And they've been really, really good partner. I can't say enough about the relationship we've got there and the support they've shown us. The other part, I guess, the other hailed hallmark of that agreement, and I hammered this home a lot with investors, whether it be recycling, whether it be cobalt refining and one day, nickel refining, our objective is to try to insulate the company and our shareholders from the wild swings that commodity markets are known for. So it's not quite a total type structure, but the idea of the arrangement that we entered into there and others that we're looking at is to have steady earnings that provide us with a good rate of return and a floor without the -- again, without the downside pressure, certainly, of the commodities market. And this contract, I think we've said it before in the past, it's a big contract, USD 620 million worth of cobalt to the battery maker under this contract. So that's on LG. We can come back to that if there are questions. And now I want to go to '21 and talk about Three Fires. Three Fires is an economic development agency for First Nations groups in Southern Ontario, great track record in consultation in advising other First Nations. They've got their hands in a lot of businesses, and they work with some pretty impressive partners, and we're delighted to be a part of them. Relationship early on, we were looking at a strategic investment. For reasons -- various reasons, we paused that. We did our financing. We're able to complete the financing without that investment, and we've kind of doubled down really on the commercial side than the formation through an MOU, initially, of a primary recycling business, so otherwise known as a shredding business. Within their traditional territory, there are a couple of battery plants coming. And so the idea for us is to extend our supply chain and be able to participate not just in the refining, but embark with them into a shredding business as well. So the work over the last quarter has really been around funding. They've taken that upon themselves to find the funding for the JV. Electric team, commercial and technical have been working on the business plan, so review of equipment suppliers around the world. And also really benefiting from the feedback of global battery makers that have had a number of years of black mass shredding experience with third parties and understanding what they like, what works, what doesn't work, how we can do things better and then a lot of discussions with stakeholders. And so stay tuned, we have more to do on that. We have regular meetings with this group, and I think there's a lot we can do together. If you turn over on Page 21, actually, you'll see the map of the, I guess, the closed loop that we're really trying to create here. We've got, again, plant scale refinery that we'd like to commercialize. If we can build a shredding facility south of Toronto, capture battery scrap, then send that black mass north of Toronto to refine it and separate the metals into their constituent elements, you've got a nice proximate closed loop with a very small carbon footprint by way of transport. And importantly, we distinguish ourselves in terms of how we're approaching commercial discussions in that we're not trying to buy the black mass. Long-term battery makers have no intention to sell their scrap off their manufacturing floor only to buy it back the next day. And so this, again, much like the LG relationship on cobalt, it's a relationship, and it's a margin-based relationship. For us, we get the benefit not just of exposure on the shredding but of a steady supply of material up to our refinery. And it allows us, again, to expand, expand our business model and we're not going to limit ourselves to that market either. So that's the business model integration. The other -- I guess the other piece I should mention on the refining side is when it does come in to our refinery, to be able to integrate a black mass plant with our cobalt plant has other advantages. Mark showed you an image and talked about the MHP we're producing. As we commission the cobalt plant, that MHP, we can stream out the cobalt and make the battery-grade sulfate. And so it's a step approach. We think it's a cautious one and a logical one by way of de-risking the process and gradually moving towards battery-grade product production through recycling as opposed to just commercial products, which is fine and generates money. But closing the loop completely, returning it back supply chain is something that will come. It's just the market is not ready for it yet given the infrastructure in North America. All right. Maybe I'll go to 23 here and talk about some of our near-term milestones. We have said on a previous call or maybe 2 that we anticipated 2023 was going to be challenging. With hindsight, I'm pleased that we moved, I guess, relatively early compared to maybe other players in the commodity space to kind of pull in our horns and try to mitigate the pressures that we saw, and I think that's paying a price. It's not what we want it to do, but it was the right thing. And thanks to Mark and the team and the work we've been doing over the last couple of years on black mass, we didn't have to sit idle. We were able to use what we have, the team, the process, the equipment and accelerate our black mass strategy. And so as those of you who follow the story know that ours is a multipronged story of taking a permitted met site and doing cobalt and then recycling nickel and perhaps manganese and having everything in one location. So with this pause on the construction, we were able to move Phases 1 and 2 together simultaneously, and that's going to yield some benefits as the market starts to recover. So on this page, you can see a number of milestones, keep receiving the long-lead equipment items that Mark outlined. We will have more information for the market on the black mass trial and share with you some of the learnings and how we distinguish ourselves. Government funding, we've got some short-term sources we think we can yield. And as I alluded to very early on in the call, we have a bigger solution for the cobalt facility that we are spending a lot of our time on. Outside of the -- that met site, we've got Iron Creek, a little bit of field work. We'll have some news for that. We're also permitting a 10-year plan, so that when we do start drilling around the U.S. Forest Service, properties around our Iron Creek asset, we can move with a little bit more expediency. And then lastly, the Bécancour study. Again, that's our second refinery, -- great opportunity to work with Quebec in Canada on a battery materials part that already has FROM, Ford and BASF as potential downstream clients. And so we will move forward with that in due course to do a study and see how we might integrate our operations there as well. So we'll open it up to questions now if anybody has any.

Galine?

[Operator Instructions] Our first question is from Matthew O'Keefe with Cantor Fitzgerald.

Just, I guess, my main focus here is really around liquidity. I mean, yes, you did add that financing which has certainly helped, but your working capital position is still kind of low given your burn. So a couple of questions on that. So one, you still have long lead items coming in, and the question around that is, are those all prepaid? Or are there still costs associated with these preordered items, these long-lead items? And two, with additional sources of financing you have -- no, sorry, you have the government and you've got Three Fires group that are sort of promising some money, but we've been hearing about that for a while. So what's the holdup on, a, getting the provincial government funding; and b, the deal that we struck, I mean from what I can see, you satisfied your side of the deal, so where's Three Fires with their portion of equity financing?

Yes. With Three Fires, I think we jointly agreed to put that aside for now. I mean, I think really what happened, Matt, and you'll recall, right, we were going to do 10-10 financing back in July, August. With the advent of the announcement of the LG contract extension, our book filled up rather quickly and just Three Fires wasn't in a position to move, and so that really is in their court. So I probably -- I mean -- I guess their feedback is they'd like to explore that. But right now, really, the focus is on getting the commercial pieces together. The real advantage I see in the shorter term with Three Fires is getting that upstream investment. And if they are taking responsibility for sourcing the capital and we're doing the technical, it's a great value add for our shareholder base. On the government piece, yes, and we've talked about this in the past, we've got a number of commitments that are out there from 2 levels of government. I think we're close. I can look to 5 of it now and say I think we're looking, and I can't say days, weeks, it's kind of out of our control right now. But I'd say $5 million is approximate. We've got another potential $10 million behind that, that's going to require a little bit more back-and-forth on terms of release. And then for the cobalt facility proper, that's a USD 60 million, not that we're trying to figure out. And we're feeling -- I'm feeling -- honestly, I'm feeling better about that than I have in about a year. I think we've identified -- the tools to fund a project like ours are finally catching up to us. We've been at this for 3 years. And now we're seeing the pockets of money open up, and I look to various government programs as well as when you start stacking up, these sources that include lead orders from government agencies, the commercial add-ons, the pile-on effect really, really does start to pick up momentum. So we're looking at, I would say, a couple of government programs. We're looking at commercial partners. We're looking at trading houses, and it's not something we'll see by the end of this year, but I'm quite optimistic that things will get more interesting for us as we move towards the summer.

So just to add on to that, Matt. Sorry, Matt, just to add on to that. I mean, one key thing to take into consideration from a timing perspective on the funding has to do with the completion of the re-baseline report that helped de-risk the costs associated with the project. And I think factoring that development is -- also impacted some of the timing of the release of the funding that's been committed to us. So that review process, the ongoing process that we've been making are factors that have caused some of the timing issues that we've experienced on the funding. So with that de-risk behind us, as Trent just pointed out, we're hopeful that it'll be coming a little sooner than later.

And I didn't answer the first part of your question, Matt, I apologize, on the equipment deliveries. We're now at the receipt date, so no new liabilities are being incurred. The items here are all reflected in our financials as commitments, and so it is really a question of delivery. Peter and the team have been focused on, just, cash conservation. And so we've had G&A reductions. That continues to be a focus into next year.

[Operator Instructions] Our next question is from David Talbot with Red Cloud Securities.

You guys are continuing this black mass trial through Q4, tweaking the process in the flow sheet. When should we expect that black mass report? And then assuming it's positive, how quickly might that lead into a planned 2,500 ton per year ramp-up, and assuming that's rightsized for viability?

Yes. The report, we're working on it right as we speak. I'd like to say we're going to get that by the end of the year, but I think we have some immediate priorities around funding that has taken up the technical team's time. Some of these funding streams are all consuming in terms of the documentation that you need to submit. So I might -- Mark, correct me if I'm wrong, maybe end of January. Does that sound like a reasonable period of time for a black mass summary report?

Yes. I think that's reasonable. And that's exactly what Trent is saying. Some of our engineers are -- that would be working on the report are tied up with some of these other government funding initiatives. And again, parts of the report are going to be redacted, because there's IP associated with our process here. But I mean, the gains that we've made, I think, they've surpassed or they certainly surpassed my expectations as -- in terms of the quality of the product and the recovery rates that we're seeing. And we clearly identified the areas that we can optimize even more but will require more capital to do so in a 2,500 tonne per annum plant.

And I'd say the -- yes, the desktop study still stands, right? I mean we've got a number of assumptions in there that we'll need to validate. So I think with this report that Mark's team is working on, the immediate next step will be to do a METSIM model tend to do equipment sizing. And then once we've done that and validated assumptions that we have made in our desktop study, it's at that point that we'll be able to get into some detailed engineering and look at lead time for long-lead equipment, tanks and vessels and whatever we may be lacking. And then look, and start -- I think in light of what we're seeing in the market today, we're not going to start construction or do any equipment orders until we've got the capital in hand. We -- and we know this. We've all been in the industry for a lot of years. But when we decided to pause construction in March, I mean it's tough to solve a procurement machine when you've got stuff being ordered and fabricated from around the world. And so it's like slowing down the Titanic. Well, I mean, in our case, maybe it's not a Titanic because we're not that big a project. But yes, I think we'll be very careful before we press start. I don't think the time line need be that long, but we don't want to get ahead of ourselves.

Yes. And would that CapEx be included in the $62 million of the cobalt sulfate plant? Or is that a little bit of an additional CapEx on that…

Yes, different -- yes, David, good point. We're treating them as 2 discrete projects. So the USD 60 million is what gets the cobalt plant into production. And then with the black mass, the desktop study was a separate capital amount.

Okay. Do you have an idea of what that capital is?

Well, that stop was about CAD 8 million, so I guess USD 6 million, I'm sorry. And so that's what we are -- what we want to validate with the next level of study. I don't know if we've agreed to feas. Maybe it's pre-feas. I think we can go to fees. But I think the network, the METSIM modeling and then the feasibility will [ thrash ] that around a bit.

And the 20 tons of MHP you sold, can you say anything about sales price on that? I'm assuming you're not booking revenue but applying that to capital. And then, I guess, more importantly, any feedback on the quality of the material that you're delivering?

Do you want to say something that Pete?

Yes. The sales price was about -- sorry, USD 82,000, and that's been recorded as part of the other income number.

And then the feedback from customers. Mark, maybe you can address that? What kind of feedback on the --feedback from customers?

Well, we -- the contract that we have with our customer that we've actually exceeded the met content, and we're far below the impurity levels. And as I mentioned, we're continuing to work on both, and we've been successful in even advancing both, so it's well within the specification required. So that's been fairly positive.

And I'd add to that, one of the comments that Michael, our VP of Commercial, received in marketing the product is this is -- MHP, in one hand, it's great, right, because it's a marketable product that can be sold in various channels. And it's not like a battery-grade product that you need to qualify. However, to make an MHP from a black mass, you don't see that in North America. I guess it's a first mover thing. And so part of that was just whereas most MHP is coming out of a primary production, like in Indonesia, ours is a little different. And so one of the early conversations we had to have with potential buyers is just deleterious elements and threshold levels and things you have in the battery that you wouldn't see in a mine. And that's been -- I think it's been very positive. And as we move forward with our process and done some of the work and tweaks that Mark has talked about, I think we've opened up a few more channels to buyers for MHP when we do expand that footprint.

[Operator Instructions] This concludes the question-and-answer session. I'd like to turn the conference back over to Joe Racanelli for any closing remarks.

Yes, I just want to -- before we go to Joe, I just want to thank everybody for tuning in. These have been tough markets in 2023, but I like our prospects for 2024. I think and hopefully hit peak inflation. But I guess, more importantly, we took some early steps to insulate ourselves from a lot of that. And I think we're looking pretty good with most of the long lead equipment now at site. Just by way of reminder, if you look at what we have, that picture Mark showed at the aerial of the site, I mean, that's a replacement value of USD 200 million with $60 million to go. And so from a cost perspective, it looks like a small -- it's not like building a mine where you're going to be 10 years and $1 billion and questions around permits. This is a site that is permitted, it's operating, it's got low capital intensity. We've got the commercial contracts. We've got the feed in. We've got the contracts out. LG is buying 80%, and I will tell you, there is a bit of a battle for that remaining 20%. It's effectively sold on paper. I'm really looking forward to it. Thank you to our shareholders for hanging in there, and I'll turn it over to Joe.

Thank you, everyone, for joining us today. And if you do have any follow-up questions, please feel free to reach out. We will continue on providing updates on our progress, and we'll be disclosing announcements as they unfold. Our next slated call when we'd provide an update will probably be towards the end of February, early March as we report our year-end results. And until we speak, good luck to everyone. And for those in the U.S., Happy Thanksgiving and a little later from then, season's greetings and tidings.

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