MUX

Hello, ladies and gentlemen. Welcome to McEwen's first quarter 2026 operating and financial results conference call. Present from the company today are Rob McEwen, Chairman and Chief Owner; Ian Ball, Executive Vice Chairman; William Shaver, Chief Operating Officer; Perry Ing, Chief Financial Officer; Jeff Chan, Vice President, Finance; Stefan Spears, Vice President, Corporate Development; Kevin Bromfield, Project Director, Grey Fox; Michael Meding, Managing Director of McEwen Copper; Carmen Diges, General Counsel and Secretary. After the speakers' presentation, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you'd like to withdraw your question, again, press star one. I will now turn the call over to Mr. Rob McEwen, Chief Owner. Please go ahead, sir.

Thank you, operator. Hello, everyone, and thank you for joining us today for McEwen Inc.'s first quarter 2026 results conference call. Our vision is clear and ambitious. McEwen Inc. offers investors a unique and powerful combination, direct exposure to growing gold and silver production, proven hard money assets that have served as storers of value for millennia. Along with large optionality to copper, a foundation metal of modern civilization, essential for electrification, renewable energy, electric vehicles, data centers, and the infrastructure of the future. We are scaling the company to 250,000 to 300,000 gold equivalent ounces, GEOs, per year by 2030, while maintaining a strong balance sheet. We've just released our Q1 results, and I'm very pleased to report that we delivered a strong quarter.

We generated net income of $33.4 million or $0.56 per share. This compares to a net loss of $6.3 million or $0.12 a share in the same period last year. This is a significant turnaround and reflects our improving operational performance, higher gold and silver prices, and a more disciplined execution. We are advancing our multi-asset growth strategy with internal funding, positioning the company to nearly double production while minimizing dilution. Just like to talk about our operational and project highlights. In Canada, at our Fox Complex in Timmins, Ontario, we're making good progress. As the Stock mine underground development remained on budget in Q1, initial production is expected in late 2026 and commercial production starting next year. Grey Fox, we're finalizing a pre-feasibility study expected in the next coming months.

And so, combined, Stock and Grey Fox are targeted to deliver 75,000-90,000 gold equivalent ounces annually by 2030. We are also advancing the Tartan Mine project in Manitoba with an updated resource of 309,000 indicated ounces and 303,000 inferred gold ounces. We're targeting initial production of 30,000 ounces per year with the potential to reach 45,000-55,000 ounces per annum. Overall in Canada, we expect production to grow from 16,000-19,000 ounces this year to 105,000 ounces, stretching to 120,000 ounces by 2030. At Gold Bar, Nevada, operational optimization and exploration success are driving increased outputs and extended mine life with gold production expected to reach 90,000-100,000 ounces by 2030.

In Mexico at El Gallo, ongoing improvement, we expect to boost production up to 20,000 ounces again by 2030. Together, Canada scaling to 105,000-120,000 GEOs plus continued growth at Gold Bar, El Gallo, and our Argentine assets, San Juan, positions us to achieve our company-wide target of 250,000-300,000 gold equivalent ounces by 2030. I'd like to talk about our investment in McEwen Copper. As shareholders, we benefit from our 46.3% interest in McEwen Copper. Based on the most recent financing of McEwen Copper, this stake is valued at approximately $456 million or roughly U.S. $7.67 per McEwen Inc. share.

Los Azules is on track to become one of the world's first regenerative copper mines and carbon neutral by 2038. Coming into production, we're looking at 2030. It's delivering significant embedded value and upside to McEwen Inc. Gold prices remain supportive. Our operations are cash flow positive, and we have a strong project pipeline. Our strategy is straightforward. Execute development projects safely and on budget. Aggressively explore to grow resources and reserves. Self-fund growth to protect shareholder value. Deliver consistent production increases and rising cash flow. I'd like now to turn the conversation over to Perry, our CFO. Before that, I'd just like to thank the entire McEwen Inc. team for their work this year. We're excited about what lies ahead and remain committed to disciplined growth and long-term value creation. Perry?

Good morning. Thank you, Rob. I think I'll just touch on a few highlights from our first quarter earnings and then talk a bit about the financing of the growth plans that Rob just outlined for us. Starting with the quarter, as Rob said, we had a great quarter. We earned $0.56 a share basic and $0.47 a share fully diluted. Our revenues from our 100% owned operations more than doubled from a year ago, given high gold and silver prices. We also noted the benefits in this quarter of the capitalization of our equity recorded investment in McEwen Copper. Having published a feasibility study last year, we now capitalize those costs on a U.S. GAAP reporting basis.

We only record a small net loss compared to having to expense our share of all of their exploration costs in the past. I'll note that we did receive an $8.8 million dividend during the quarter from our MSC mine in from Minera Santa Cruz, from the San José mine in Argentina. We expect on the balance of the year to receive an additional $30 million-$40 million in dividends given strong silver and gold prices. I'll note our cash increased during the quarter despite our continued spend to complete the Stock ramp. Our cash balance at the end of the first quarter was $57 million versus $51 million at the beginning of the year.

I'll note that our cash costs and all-in sustaining cost guidance, we believe we're well on track to meet our full-year targets as we expect to increase ounce production for the balance of the year on a quarterly basis. As well, we expect the costs, our development costs at the Froome mine to decrease as we finish ramp development towards the end of mine life, which contributed this quarter about $800 to the all-in sustaining cost at the Fox Complex. Just taking a look and kind of expanding on Rob's point in terms of how we're going to build our operations to 250,000-300,000 ounces from our current basis.

In terms of projects we have on the go right now for 2026, we see total CapEx, project CapEx this year of approximately $50 million remaining to be spent from Q2 to Q4. We have approximately $35 million remaining for the Stock mine to complete development and other related costs there. We expect in the second half of this year to begin construction on Mexico for El Gallo. We're currently budgeting about $15 million. All of that will be funded by our existing cash flows as well as the dividends we expect to receive from the San José mine.

Looking forward to next year, 2027, we see the CapEx profile approximately double to about $100 million as we finish Mexico, as well as begin work on the Grey Fox, as well as expansion projects in Nevada. We expect free cash flow from our operations as well as dividends from MSC to exceed $200 million at current gold prices. We do have a significant buffer, even at, you know, lower gold prices, say to the $4,000 level, at which we can still sufficiently fund easily from free cash flow. In 2028 and 2029, we see those costs, you know, subject to permitting timelines increasing to approximately $150 million.

At the same time, we'll have the benefit of production from Mexico as well as increased production from the Fox Complex, providing additional cash flow of over $250 million annually, which will provide more than sufficient cash flow to achieve the growth stated. With that, you know, I think that provides kind of a high-level overview of how we can achieve this growth without additional dilution to our shareholders. With that, I'll turn the presentation to Michael Meding in Argentina.

Thank you, Perry. Good morning, everybody. I will keep my remarks focused on Los Azules, and specifically on the question that matters most to the project as we scale. How we finance the path from where we are today through to construction. A quick word on Q1 execution before I turn to financing. Q1 was about putting the building blocks for FID, the final investment decision stage gate in place. Our integrated owners team is up and running with Samuel Engineering, the engineering firm that has supported us over the last four and a half years very successfully through PEA and feasibility. Now their personnel embedded alongside McEwen Copper staff. Jim Sorensen, who served as study director through the feasibility study, has stepped in as project director.

Jim brings with him 45 years of experience in mining, including significant roles building large scale, multi-billion dollar mining projects like Cerro Blanco, Galarza, Cefa, Loreto and Florence. Together with more than 10 years of mine operating experience, including vice president role at Newmont Mining Corporation. Detailed engineering is advancing across every major work stream. Drilling, access roads, heap leach pads, stockpiles, major equipment packages, trade-off studies, and our EPC and partner selection process. On the regulatory side, the RIGI, the Incentive Regime for Large Investments in Argentina, the VAE section was fully operational during Q1 and is already delivering a meaningful cash flow benefit. We also had a productive International Finance Corporation, part of the World Bank site visit, with our conversation advancing on the alignment to the IFC, the International Finance Corporation performance standards. The technical and regulatory foundation for FID in place. Now towards financing.

The total financing path from FID to full operation is approximately $4 billion. That number gives you the scale of what we are building. To date, we have raised over $450 million in private financings between 2021 and 2025. The capital came from a strong group, Rob McEwen, Rio Tinto, Stellantis, McEwen Inc, and others. Together with McEwen Inc's early exploration investments, this funding carried the project to PEA feasibility study and into the detailed engineering phase. Our shareholders have already invested substantially behind their conviction in this project. The next step is bridging to FID. In January 2026, we established a $240 million secured loan facility structured with an accordion feature so additional participants can join.

Rob McEwen, McEwen Inc, and Bill Shaver have committed approximately one quarter of the facility, and roughly three-quarter remains open, and we're having several conversations with potential investors to close the remaining parts. The facility comfortably covers our pre-FID budget of about $197 million, with a cash need there that we have of approximately $161 million. In short, this funding takes us cleanly through to FID. Post-FID, the construction and ramp-up package is approximately $4 billion. We are working with a target capital structure of 40% equity and 60% debt. We see that as a realistic and bankable structure for a project of this scale in Argentina. On the debt side, we are in the final stages of appointing debt financing leads, primarily focused on export credit agency financing alongside other debt financing components.

The IFC has expressed interest in serving as a lead arranger for project debt financing, and we are progressing the steps required to formalize the role. We expect the debt side to be anchored by an ECA-backed senior tranche complemented by traditional project finance. On the equity side, we are in active conversations with several potential strategic partners. Our preference is to bring in a senior mining partner together with an industrial or trading counterparty for offtake alignment and to round out the structure with other equity participants. These discussions are advancing well. Pulling it together, the technical work is on plan, the regulatory program is delivering, the bridge to FID is in place and partially subscribed, and the post-FID financing is taking shape with high quality counterparties on both sides of the capital structure.

Our objective is to reach final investment decision by the year end of 2026, with construction commencing in early 2027. Obviously, subject to project financing and customary approvals. We are advancing well toward FID. Thank you so much. Now I'll hand it back over to you, Rob.

Thank you, Mike. We're gonna move to Ian Ball to talk about one aspect of Los Azules, another value we have there.

Thank you, Rob. One of the aspects, one of the assets inside McEwen Mining, which I think is often overlooked, is the 1.25% royalty that we have on the asset. In the quarter release we put out yesterday, we wanted to highlight some of the cash flow possibilities there once Los Azules in production. If you look at the royalty based on the spot price of copper, you're looking at total cash flows well in excess of half a billion dollars U.S., That's based on the 22-year mine life that was outlined. There's also a scenario using the Nuton technology that would add an additional 33 years of mine life on top of the 22, getting you to 55 years of life that we don't factor into that half billion dollars. There's resources beyond that.

We've also excluded all the gold and silver, because currently there's no plans to extract that, but it is an additional possible revenue stream. We bring these numbers up because if you look at the biggest royalty company in the world was Franco-Nevada, based on the Goldstrike royalty. If you look at the revenue they generated from Goldstrike from 1985 to when they were acquired by Newmont, it was approximately $1 billion of cash flow. If you look at Los Azules, we have a profile that, although it would be over a longer period of time, could generate something similar. When you look at the world today, there's not many world-class royalties available. If you look at Franco and Wheaton River and the price they're paying to acquire these royalties, the valuations of these have been going up.

We want to highlight this because we do think it's gonna be a very meaningful asset for the company going forward. I also want to touch upon our exploration as we put out results at all of our sites. I just wanna highlight a few items for you. We put out a new resource for our Windfall deposit in Nevada. If you look at reserves resources right now at the Gold Bar complex, we're about a million and a quarter ounces now with one more resource to come out from Trinity Ridge. We think that number is going to go up. We put out some good exploration holes today at Windfall. And with the recent acquisition of Golden Lake, we think that deposit is gonna continue to grow in size.

That's going to be important because we have a run rate of about 100,000 ounces per year we're going to have to be able to sustain, and we think the exploration is going to be able to achieve that. We're also looking to drill south of Barrick's Fourmile and Goldrush discovery. That's a 15 million ounce deposit, probably one of the most exciting discoveries out there today. We have the fault, the Cortez fault that goes directly south of that, so we're looking to drill there for lower plate rock.

We have put out some good results at Grey Fox, approximately 90 m below, where we're gonna be looking at a pre-feasibility study for mining, showing that once we put the infrastructure in place, there's additional high grade that we think we can access that will be well in excess of what we're putting in our pre-feasibilty. I just wanna touch upon just two things quickly. At Tartan, we put out a number of drill results today. I think what's interesting at Tartan, we're seeing now four or five drill holes at depth that are somewhere between 15 m and 50 m wide at 4 g/t-5 g/t. It's starting at approximately 1,000 m depth.

If those drill results could continue and we're able to find some strike length to that, we go from being a small operation to something potentially of a much larger size. We've hit on all five holes that we put down at depth, and we are drilling down there currently. We have pretty meaningful expectations of what could come there. Lastly, I just want to update on future resources. We have our Stroud deposit, which is part of the Grey Fox Complex or the Fox Complex. An initial resource is coming out there with the pre-feasibility study. We're gonna be putting out an updated resource for El Gallo, which I think is gonna show a resource base there that would support a mill for a considerable period of time.

We have our Trinity Ridge resource coming out in early 2027, which will support the Gold Bar complex. Lastly, although a non-core asset, we're gonna be putting out a resource on our Buffalo Ankerite deposit also in Timmins. Previously, that resource was approximately a million ounces at a lower gold price. We're gonna be updating that just to highlight some of the value that has currently not been updated in quite some time. Based on that, I will turn the call back over to Rob.

Thank you, Ian. Thank you, Mike. Thank you, Perry. Just before moving into Q&A, since I started in the gold industry, I always like looking at other assets and saying, "What's the gold equivalent?" And it changes. Looking at Los Azules, just to give you a sense of its size, Ian was talking a little bit about the, how Franco-Nevada was formed on the back of Goldstrike. Our Los Azules property has estimated resources of 35.7 billion pounds of copper. If you take the current gold price, which is right now about $4,753 an ounce, and the copper price right now at $6.02, you end up there's 790 pounds of copper equivalent to 1 ounce, the value of 1 ounce of gold.

You divide that into the 35.7 billion pounds, you're looking at the equivalent of a 45 million-ounce gold deposit. Based on the feasibility study of cash and all-in sustaining, you would get numbers of below $1,400 cash cost and below $1,700 all-in sustaining. And you'd be producing, at least in the first five years, in excess of 500,000 ounces a year. That, in anyone's book, is a terrific gold asset. We're looking at a long life asset here, and I just wanted to point that out that we're very fortunate to own, control a world-class copper asset. I'd now like to open the session to questions and answers.

As a reminder, to ask a question, you will need to press star followed by the number one on your telephone keypad. To withdraw your question, again, press star one. Your first question comes from the line of Jake Sekelsky from Alliance Global Partners. Your line is open.

Hi, Rob and team. Thanks for taking my question.

Hi, Jake.

So, just starting, with Stock, how should we be thinking about the ramp up there as we head into the second half of the year? Do you have a throughput target in mind that you'd like to be at by, let's say, the first quarter of next year?

Okay. I'll ask Bill to answer that question, Jake.

Yeah, Jake, thanks very much for the question. What we see is that the transition from the Froome mine will continue until the end of the year, and the ramp up of the Stock East mine will start relatively early in the second half of the year. Hopefully by the end of the year be ramped up to its full production. So we see the continuity of the gold production to be relatively the same in 2027. You know, I think the important aspects of that are, you know, the kind of the optionality that we have with regard to the ongoing development at Froome, which has performed very, very well in the first quarter of this year.

We see that continuing to the end of this year at relatively the same gold production as we had in the first quarter. That will make that transition kind of very smooth. You know, I think that's the critical part of the whole story and, you know, with the Fox Complex. Does that answer the question?

It does. Thank you. That's helpful. Then just switching gears to Tartan. I mean, you mentioned the possibility of expanding capacity there. I'm just curious, what does the permitting process look like for that? Would an expansion happen prior to a restart decision, or would that come after that?

Well, Kevin.

Yeah, thanks for the question. Kevin Bromfield here. We're currently embarking upon a notice of alteration for permits so that we can do some site cleanup and continue with our activities. We've got a lot of excitement coming out of the drills there. We're currently evaluating the path forward. Does it consist of an advanced ex program? Also challenging aspects of the validity of past permits. We're understanding that landscape right now and making sure that we have the baseline data to support a decision that we're gonna be making as the exploration activities go on.

Well, may I add.

You want to add to that?

I do want to add a little bit to that. The reason why we're looking at it from the 500 tons per day and then looking to expand to the thousand is that we do believe that we can utilize the existing 500 tons per day permit that was put in place in the mid-1980s. We want to get the mine up and running at that run rate. Then if we were to expand to a thousand tons per day, that might require a major alteration to the permit, which obviously has more time inherited to it. We want to be able to phase it to go from the 500 to the thousand, but if we use an existing permit, we think we can get there a lot faster than trying to expand it all in one go.

Okay. That makes sense. That's all on my end. Thanks again.

Thank you, Jake.

Your next question comes from the line of Mike Kozak from Cantor Fitzgerald. Your line is open.

Good afternoon, Rob and team. Thanks for taking my questions and congrats on the solid quarter. I have a few questions from me, if I could first. I think the CapEx for El Gallo Phase 1, it's in the MD&A. I think it's at the $25 million, if I'm right on that. My question is, what is the expected CapEx on Phase 2? Have you refreshed that recently at all? I know it'll be over a longer time period, but I'm just curious what that number might be?

Yeah. We've been looking at that as well. You know, it's a number that's well into the future. You know, right now we have it planned at 10 years into the future, but we're doing approximately $40 million is what we've been looking at. That would be consisting of a haul road connecting the two sites from El Gallo to the mill, converting it from a CIL to a Merrill-Crowe, and obviously switching, you know, parts of the plant from gold to silver. Right now, that's kind of what we're thinking. You know, we can move that ahead if we wanted to, or we keep it where it is. The $40 million is generally what we've been thinking about.

Okay, great. It's not in the hundreds. It's a manageable number. That's kind of what I was getting at.

We do believe it's a very manageable number.

Okay, perfect. Then second, you know, I just noticed quarter-over-quarter the cash is really starting to build up in the San José JV. I got your guidance for dividends from the JV this year, you know, $40 million-$50 million on the year, $30 million or $40 million remaining. My question is, based on your discussions with your partner there, can I assume that run rate of dividends will continue in 2027 and 2028 if we were to hold gold and silver prices around these levels, or have you not had those discussions yet?

Hi, Mike. It's Perry. We are having ongoing discussions. I think the first thing is, you know, full satisfaction of the reclamation obligations, which will take, you know, a significant portion of kind of the existing cash balance and, you know, kind of move that to sort of a restricted cash balance, if you call it that. I would say on balance, You know, we can expect similar levels, going into 2027, 2028. If you just look at kind of the proven and probable reserves, you know, they only extend, you know, into 2027. You know, given where silver and gold prices are, you know, we think the mine can go into 2029 and hopefully beyond. I think that's a reasonable assumption to make, Mike.

Okay. Thanks, Perry. Third, if I can, Mike, I appreciate all the detail you provided on the funding strategy for Los Azules, like, right, the pre-FID bridge loan, the export credit agencies, OEMs on the debt side, et cetera. You spent a bit of time talking about a new potential large cap partner on the equity side, if I heard that right. What I didn't hear, and maybe I missed it, was mention of the potential IPO of the copper subsidiary. Is that less likely of an outcome now, or how should I think about that? Has nothing changed?

Nothing changed.

No, what we wanted to do. Sorry.

Go ahead, Mike. Go ahead.

No, no, nothing has changed, as Rob said. I mean, we are going full steam ahead with the separation of everything required to be able to do the IPO in the second half of the year.

Okay. Very good. Thanks. Thanks everyone. Congrats again on the great quarter.

Thank you.

Thanks, Mike.

Your next question comes from the line of Jeremy Hoy from Canaccord Genuity. Your line is open.

Hello, Jeremy.

Hello. Thanks. Thanks very much for taking my questions. For me, I'd just like to touch on Gold Bar. There's, you know, a lot of pieces coming together there with the acquisitions you've done. We're looking at initial resource estimates for Windfall and Trinity Ridge later this year, if I recall correctly. Can we expect some sort of study that provides visibility on how that's all gonna come together, or could you provide an update on your thinking on how those different pieces come together at that complex and, you know, ultimately what are, you know, the production rate could end up being there?

Thanks very much for the question. You know, we see the permitting of that project taking perhaps a couple of years. From that perspective, what we're trying to do at the present time is to do the drilling that's required to bring those resources up to the proper status in terms of being able to put together a mine plan and then, you know, creating the study, if you like, of how we're gonna approach that.

Basically, the strategy that we have at this point is to create a heap leaching operation that really would only be a leach pad with the carbon recovery of the gold and then bringing that carbon to our present day plant out at the Gold Bar operation for recovery of the gold. That would keep the capital cost relatively low in terms of, you know, a significant leach pad that's capable of holding ore for two years is somewhere in the $10 million-$15 million range. That kind of is the initial strategy. You know, there is a lot of potential gold to understand where it is in those properties.

I guess, you know, we're proceeding with the permitting, and the, you know, the, that permitting, you know, as you know, permitting in the U.S. has schedules that are not definitive. We see that as building optionality in the whole organization, and we're also, on the drilling that we're doing at Gold Bar itself, we see that as extending so that we won't have a gap in between those two. So, it all good at this point. While we're seeing that production coming out of Gold Bar, which I suppose was your original question, that's carrying on at the rate that we're, at the level that we're at at this point.

Okay. Well, thank you. I really appreciate the color and, well, looking forward to, seeing things develop there.

Yep. Very good. Thank you.

Your next question comes from a line of John Tumazos from John Tumazos Very Independent Research. Your line is open.

Hello, John.

Congratulations on all the earnings.

It was nice to have them. Finally.

Could you review the human resources development as you've added assets in the past year? Who are some of the key managers or technical people that came on board or stayed on board as you consolidated assets in Central Nevada and consolidated assets in Manitoba or anywhere else in Canada? Could you elaborate on the challenge of coordinating several small or medium-sized properties in Canada and Nevada and Western Mexico, assuming that McEwen Copper and the Hochschild partnership manages themselves? Just give us confidence as to the human resources development as you grow and are a little more complicated.

Well, I'll ask Kevin to speak to that point. He was brought in to deal with the Grey Fox expansion and is overseeing the Tartan development.

Thanks, John. It's a great question. You know, competing for talent in the current mining market is a challenge. One of the things I guess one of the people added would be myself. I'm located in Sudbury. We're in the process of building a Sudbury projects team that's going to support Canadian projects and beyond. We're a growing group. We've also added government relations support. We've added to our human resources capabilities here at headquarters in Toronto. We are putting some pieces into place, and so far we've been able to assemble what I think is a very good team. I would say that the growth needs to be ongoing as we get toward execution as we ramp up our capital spends.

Yeah. I might just add that we've also added resources in terms of our permitting group, and our technical group, overseeing all of the projects. You know, we've been fortunate enough to bring on people like Kevin. You know, Kevin and I have a history, having worked together for about 10 years. You know, I think we're building a foundation of a really good group, going into the future.

You know, we see Northern Manitoba as being an opportunity in part because around Flin Flon, there's a big mine that has closed there, but there's still a significant number of mining people who live there and are traveling now to work at other places, so they'll come back home. You know, it won't be easy, but I think we have the rudiments of a really good team that we're building and, you know, that's the fundamental part of it at this stage.

Yeah. John, I'd say we've been centralizing a number of the skills such as procurement, IT, looking at how do we incorporate more of that technology into our future operations. AI as well.

Thank you, and it's impressive that you manage costs while you're metamorphosizing the organization. Thank you.

You're welcome.

Thank you.

Your next question comes from a line of Sydney Beckman from Strenella. Your line is open.

Hello, Sydney.

Hello, and wonderful. Thank you for taking my call. The McEwen Copper IPO has been on the roadmap for a while. Given that the feasibility study is done, the RIGI approval is secured, and the FID is targeted for year-end, the de-risking work appears largely complete. My question is, has a bank been mandated for the IPO? If so, which exchange is being targeted? If a bank has not yet been mandated, what is the specific remaining gate item before that happens? Is it the FID itself, a copper price threshold, or something else? What should investors treat as the single most important milestone to watch between now and year-end that tells us whether the IPO is on track or slipping? Thank you.

All right, Sydney. We haven't chosen a banker. We've had discussions with many. In terms of listing, we're still debating that. It appears that you can get to market faster by doing a Canadian listing. It's considered faster and cheaper than doing a listing in America. Although, my preference is to go to America first, just because of the size of the market, and the pricing tension that would probably appear in the IPO. Those two have to be decided. In terms of catalyst, it's completing the financing for, to fund the FID and we're getting close to having that funded. I guess we announce that and then moving it on to getting all the engineering done to start construction in 2027. Did that cover off your question?

Thank you. Yes.

Thank you.

Thank you so much.

Again, if you'd like to ask a question, press star one on your telephone keypad. We'll pause for just a moment. There are no further questions at this time. Mr. Rob McEwen, I turn the call back over to you.

Well, that's very nice of you, operator. I'd just like to close by saying, we're excited about what lies ahead and committed to pushing the company forward and building long-term value.

This concludes today's conference call. This concludes today's call. You may now disconnect.

Hello, ladies and gentlemen. Welcome to McEwen's fourth quarter and year-end 2025 operating and financial results conference call. Present from the company today are Rob McEwen, Chairman and Chief Owner, Ian Ball, Executive Vice Chairman, William Shaver, Chief Operating Officer, Perry Ng, Chief Financial Officer, Jeff Chan, Vice President, Finance, Stefan Spears, Vice President, Corporate Development, Michael Meding, Managing Director of McEwen Copper, and Carmen Diges, General Counsel and Secretary. After the speakers' presentation, there will be a question and answer session. If you'd like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you'd like to withdraw your question, again, press star one. I will now turn the call over to Mr. Rob McEwen, Chief Owner. Please go ahead, sir.

Thank you, operator. Good afternoon and welcome, fellow shareowners and interested investors. 2025 was a very momentous year for us, for MUX. One that I believe will be the first of many to follow. The higher gold, silver, and copper prices certainly contributed to giving us a big reason to smile, but there are many more reasons for us to continue to smile. Beyond the excitement of the higher prices, our vision of the future is accelerating towards becoming a reality. Our focus on exploration has been adding resources that will extend the lives of our mines. Our focus on expanding our existing operations, plus several acquisitions, has created the opportunity for us to significantly increase, more than double, our precious metal production by 2030. Our focus on driving McEwen Copper's large Los Azules copper project towards production has been extremely successful.

So far, our efforts have attracted global corporations as shareholders and completed extensive work to produce a feasibility study, which we published last October, that outlined an economically robust, large, long life, low production cost per pound, environmentally sensitive model for mines of the future. Compared to a conventional copper mine of comparable size, Los Azules is planned to have much lower water consumption, energy needs, carbon emissions, and it will have no tailings and be utilizing 100% renewable energy. It is designed to not only be profitable, but to improve the general public's impression and acceptance of mining. We are planning to take McEwen public later this year.

Should the copper price remain around current price levels at the time of going public, we expect this world-class deposit with strong economics that it will attract a much higher price than our last private placement at $30 a share, and that will be reflected in a higher value of McEwen Mining's shareholdings. I'd now like to ask Ian Ball to speak about the big questions that come out about our growth.

Thank you, Rob. When you look at the press release that we put out this morning, the thing that becomes apparent is, as a shareholder, I guess what I would be asking is, how are you going to finance this growth? Because there's no point of growing if all you're going to be doing is diluting your shareholders in the process. When I rejoined the company back in September and my ownership from Canadian Gold was moved into McEwen Mining, you want to see the share price grow, and that was my only reason for coming back to the company. I want to walk you through our plans and how we're going to double production and do so in a way that maintains your ownership.

First, the one thing you have to look for is at today's gold and silver prices, we are generating significantly more cash flow. We received our first dividend from the San José Mine in quite some time. That's, one, due to metal prices, but also them having covered off a number of closure obligations, which is now freeing up a lot of operating cash flow to be paid out as a dividend. Second is we're finishing up our development at Stock, and we're going to be getting cash flow coming out of Mexico as well. When you combine that with our current operations, our internal cash flow will be ever increasing, which will go a long way to developing our next two projects, which are Gray Fox, which we're looking at as an underground operation that would feed our existing Stock mill.

Then looking at our Gold Bar operation, where we're essentially continuing on what we're doing there today, which is a little more pre-stripping and expanding the leach pad. We do believe that these projects are scaled in such a way that we can finance them. We're hoping mostly internally, but if gold and silver prices were not to maintain these levels, it would not represent excess dilution to our shareholders. We're very mindful of the cost of capital and how does this translate into a per share value over the next five years. The other question is, you know, how realistic are these goals? One thing to point out is everything that we're looking at is either at an existing mine site or rehabbing a mine site here within our precious metal bases.

We do think these are projects which are quite achievable with the time frames that we have set out today in the press release.

Thank you, Ian. I will now ask Perry to discuss our financial performance.

Thanks, Rob. Good afternoon, everyone. Yes, as discussed earlier, you know, the fourth quarter was very good. Our business delivered a strong finish to the year. Gross profits on an accounting basis more than doubled quarter-over-quarter, rising to $17.4 million from $7.8 million just the quarter prior. For the full year, gross profit increased to $47.6 million, up from $30.9 million in 2024. The strength flowed through to our bottom line in terms of reported net income. In the fourth quarter, we generated net income of $38.1 million or $0.70 a share, compared to a net loss of $8.2 million or $0.16 a share in the fourth quarter of 2024.

For the full year, we delivered net income of $34.4 million which is a sharp turnaround from a net loss of $43.7 million in 2024. What are the main drivers for that? I think, both Rob and Ian touched on, the higher gold price environment. The higher gross margins come from both increased production that we saw in the fourth quarter relative to the rest of the year, as well as higher realized gold prices at our 100% owned operations, where we realized over $4,400 an ounce gold in the fourth quarter. As Ian touched on, we also had solid operating performance for our San José Mine, where we reported $33.5 million in the fourth quarter just for our 49% interest in, the San José Mine.

As noted, subsequent to the fourth quarter, we received a dividend of $8.8 million in February. Also tied to our accounting net income is a $27.5 million deferred tax recovery tied to the expected use of U.S. tax losses, which shows our expectations for continued profitability at our Gold Bar Mine complex in the United States. I believe these results underscore the progress we're making in terms of our operations, cost discipline, and positioning our assets for growth in 2026 and onwards. I also note that in terms of our balance sheet, we ended the year with a strong cash position of $51 million compared to $14 million at the year-end 2024.

Thank you, Perry. Now I ask William to speak about our operations and looking forward.

Yes. Thanks very much, Rob. With regard to our operating entities at Gold Bar and Fox, I'm happy to tell you that it looks like the first quarter is going to be on target, and that will put us in a good position to have the whole year. If you remember last year, we kind of had a bit of a slow start to the year and that kind of plagued us through most of the year. This year we put a concerted effort into getting off on the right foot, and I think we're doing well on that front. As you know, Mexico is also producing a small amount of gold and that's not a significant amount of our production.

However, it is carrying all of the operating costs out of Mexico. As we move forward in this year, we will complete the development of the stock ramp, and the access over into what we call Stock East. That portion of the mine should be in production in the second half of this year. We're also working hard on our Gray Fox pre-feasibility study, which will be out in the month of June. We're doing the detailed planning of bringing the Tartan asset into production, and we have permitting work going on all of these projects, including building the Phoenix project.

As Rob mentioned earlier, you know, our exploration over the last four years is now coming closer to production and, you know, we can see all of these projects moving towards production this year. Of course, in the third quarter of this year, we will complete mining at the Froome Mine, although, you know, we're still drilling some lower parts of the Froome West and we're seeming to be finding ore on some of these holes. Froome may in fact, you know, find a way to go for another couple of quarters.

All in all, we're pretty happy with where we are in the projects and the project development and, you know, I think it's nice when you're in the third month of the year that you're able to say that the first quarter is gonna be on target. That's a rough summary of where we are.

Thank you, Bill. Now I'd like to ask Mike to talk about our McEwen Copper's Los Azules project.

Thank you, Rob, and good afternoon, everyone. It is a pleasure to be here today with an update on McEwen Copper and the Los Azules project. I want to be direct with you. 2025 was a transformational year for this project, and we enter 2026 with more momentum than at any point in our history.

When we look back at what we accomplished over the last 12 months, three things stand out. First, we secured RIGI approval, locking in 30 years of regulatory and fiscal stability in Argentina. Second, we completed a robust feasibility study that confirms Los Azules as a globally significant low-cost copper project. Third, we did all of this while the macro environment for copper has only gotten stronger. Let me start with RIGI, because this was arguably the single most important de-risking event in the project's history. In September 2025, Argentina approved our application under a large investment incentive regime. What does this mean in practical terms? It means Los Azules now benefits from 30 years of legal, fiscal, and customs stability. Our corporate income tax rate drops from 35%-25%. We receive a 50% reduction in dividend withholding tax.

We are exempt from export duties at the start of the exports, and critically, we have guaranteed access to foreign currency and international arbitration. RIGI was designed to attract exactly the kind of large-scale investment that Los Azules represents. It has fundamentally changed the investment framework for mining in Argentina, and we were among the first to secure these benefits. In October 2025, we released the results of our feasibility study, and I want to walk you through the headline numbers because they tell a compelling story. The base case at $4.35 per pound of copper gives us an after-tax NPV at an 8% discount of $2.9 billion, a 19.8% IRR, and a payback of 3.9 years.

The project is designed for a 22-year life of project with an average copper cathode production of 205,000 tons per annum in the first five years and 148,000 tons per annum of the full life. Our C1 cash cost comes in at $1.71 per pound and all-in sustaining costs at $2.11 per pound, placing Los Azules firmly in the lower half of the global cost curve. Here is what really excites me. At today's copper price of around $5.80 per pound, the economics are dramatically stronger. The NPV more than doubles to $6.3 billion. The IRR jumps to 30%, and the payback shortens to just 2.7 years. The NPV to CapEx ratio moves from just under 1-2.

Every dollar increase in the copper price adds roughly $2.3 billion to the project NPV. For MAG shareholders, that translates to approximately $18 per share of additional value for every dollar move in copper. Importantly, the feasibility study also identified significant upside beyond the base case. There is potential for an additional 33 years life of mine, adding another 141,000 tons per annum of copper production to either Rio Tinto's Nuton technology or a commercial concentrator. When you consider that full potential, you are looking at one of the largest and longest-lived copper assets globally. I want to emphasize something that makes Los Azules stand apart. This project has been designed from the ground up as low impact operation.

Compared to a conventional mine of similar scale, Los Azules is expected to use one quarter of the water, produce one-tenth of the carbon emissions, and has the potential to operate on 100% renewable power. There are no conventional tailing dams. We produce a finished copper cathode on-site which can be delivered directly to industry. This matters enormously in the current environment. Off-takers, financiers, and governments are all increasingly focused on the sustainability credentials of their copper supply. Los Azules is positioned to be a supplier of choice in a world that demands responsibly produced copper. We've also been building the institutional framework around the project. The International Finance Corporation, a member of the World Bank, has signed a collaboration agreement with McEwen Copper to align Los Azules with IFC's environmental standards, social and governance standards.

This agreement also provides IFC with customary rights to act as a lender or arranger for prospective project financing going forward. Having the IFC at the table is a strong signal of the caliber of project we are building. Looking ahead, our team is continuing detailed engineering work, and we are targeting a final investment decision by the end of 2026, with construction targeted to begin in early 2027, obviously subject to project financing. We are well on track. On the financing front, we are seeing strong interest from multiple categories of capital providers. Export credit agencies and development finance organizations in particular have shown meaningful appetite to support a project of this profile, large scale, long life, responsibly designed, and located in a RIGI-qualifying jurisdiction.

We are advancing conversations with the IFC and other institutions, and we are actively preparing optionality for full financing packages that gives us flexibility in how we fund construction. At the same time, we are currently evaluating the ideal timeframe for an IPO of McEwen Copper in connection with these ongoing financing discussions. The combination of a completed feasibility study, secured regulatory framework, strong copper fundamentals, and interest from institutional capital providers give us the right conditions to consider a public listing that would unlock value for shareholders and provide additional avenue to fund the project's development. Let me step back for a moment and talk about why the timing for Los Azules could not be better. We are building this project into what I believe is the strongest structural backdrop for copper that we have seen in a generation.

Copper is trading above $5.80 per pound today, near record highs. LME prices surged past 14,500 per metric ton earlier this year. Major banks are forecasting prices to remain elevated. JP Morgan expects an average of around 12,000 dollars per ton for 2026. Goldman Sachs has raised its forecast to approximately $11,400 per ton. There is structural deficit forecasted going forward on significant growth and overall worldwide declining grades. What is driving this? Three converging mega trends. First, the explosive build out of AI data centers. JP Morgan estimates data centers copper demand alone will reach approximately 175,000 tons in 2026, growing rapidly year-over-year. A single large AI data center can require up to 50,000 tons of copper. Second, the electrification of transport.

Electric vehicles use nearly 3x the copper of a conventional car, and EV adoption continues to accelerate. Third, the massive investment needed in grid infrastructure and renewable energy to power all of that. Power grids worldwide need to be expanded and modernized to support all this demand. On the supply side, we have real constraints. Mine disruptions have tightened. Declining ore grades, permitting timelines averaging 15-17 years from discovery to production, and a weakening discovery pipeline all point to sustained structural deficits. S&P Global projects that copper supply could fall 10 million tons short of demand by 2040. This is precisely the environment in which large-scale shovel-ready copper projects like Los Azules become extraordinarily valuable. The world needs new copper supply, and there are very few projects of our scale and quality anywhere in the development pipeline.

Investor sentiment towards copper equities has shifted meaningfully over the past year, and rightly so. The market is recognizing that we are at the beginning of a multi-year super cycle driven by electrification and AI infrastructure. Copper is no longer just industrial metal. It is a critical enabler of the energy transition and the AI revolution. Now, consider this. Of the 20 largest undeveloped copper deposits in the world, nearly all are either controlled by major mining houses or effectively stranded by permitting and political roadblocks, some for decades. Los Azules, to our knowledge, is the only that is independently held, fully permitted, has a completed feasibility study with costs in the lower half of the global cost curve, has its regulatory framework locked in, and is advancing toward a final investment decision this year.

For investors looking for direct exposure to a world-class copper asset before construction begins, there's simply nothing else like it in the public markets. For those of you evaluating McEwen Copper's value within MUX, I would point you to the most recent private financing is October 2024, which valued McEwen Copper at $30 per share, implying an overall market value of $987. Since then, we have secured the environmental permit for construction and operation. We have secured the RIGI, and we have secured the feasibility study with strong economics, significantly de-risking and increasing the value for the project. Let me close by bringing this all together. Los Azules is one of the world's largest undeveloped copper deposits. In 2025, we de-risked it through RIGI approval and a strong feasibility. We have a clear path to the final investment decision.

The project's environmental design positions it as a next-generation mine, and we are building it into the strongest copper market in decades. Los Azules has the potential to become a generational copper asset, one that will deliver value for shareholders for decades to come. Thank you. I hand it over back to Rob.

Thank you, Mike. Excellent. I'd just like to say, one, we have some questions I'd like to answer, and we've, through these presentations, covered off some of the questions. One, Perry was asking to provide more information on the IPO for McEwen Copper, which we're looking at later this year when we, as Mike said, complete several other tasks. Steve was asking also about Los Azules and about the milestones, and I think that was well covered off by Mike. He also had a question about Goliath Resources, which we purchased an interest in. The rationale, it's a rich gold deposit in British Columbia. It's had a high success level in its drilling. It looks like a resource that would grow. Buying into juniors was a strategy I used when building Goldcorp. I used that as a It served as a listening post, and also, one day could be a farm team member. But it also provided us with capital growth that allowed us to fund our expansion of production. We have John from Minnesota, and he's asking about our silver production. I'll ask Ian Ball to talk about that.

Yes. Regarding John's question, he was asking what is our current attributable silver production. Right now, we have silver just coming from our San José mine with Hochschild. Our portion of that is approximately 3.6 million ounces of silver. That's the total production. Ours is half. We then convert that to gold equivalent when we report our production. We're doing that right now based on a silver to gold ratio of 77-1. That's a good question because it's not quite clear when you look at our news release. If you take half of the 3.6, that's currently what we're producing in terms of silver. You know, how does that evolve over the years where our next source of silver production comes from our, what we're calling El Gallo phase II.

That is obviously after El Gallo phase I, and we're looking at approximately 3-4 million ounces of silver production there, which is 100% owned. In terms of how we look at rationalizing these, obviously we do it based on, you know, gross profit margins, but also in terms of where things are practically in terms of CapEx and permitting. The one thing we are currently looking at is if the silver price environment were to remain as strong as what it was and the margins as robust, we are looking at ways that somehow you could accelerate the phase II silver production closer to today and deferring some of the gold production coming from El Gallo. We are working on that to try to maximize the profitability of the operations.

But a lot of that obviously is driven by the silver price. Just looking at the last question here. The last question that came from John was whether the company has considered a silver dividend. Right now, just based on the optics of that, no, it probably would logistically be very difficult for us to issue a dividend in silver. I think, you know, first and foremost, if we were to implement a dividend policy, it would start with cash, and then proceed from there. I know when Rob was running Goldcorp, when I was running Abitibi, I'm not saying I copied his strategy, but we did copy his. That was to pay a monthly dividend. I think that's something that, you know, here we're looking to eventually strive towards, while balancing our growth needs.

Thank you, Ian. Operator, do you have any other questions?

We do. As a reminder to ask a question, you will need to press star followed by the number one on your telephone keypad. Your first question we have comes from the line of Jake Sekelsky from Alliance Global Partners. Your line is open.

Hello, Jake.

Hey, Rob and team. Thanks for taking my questions.

Please do.

Just looking at the 2026 guide, you mentioned in the release that no contributions from Stock were included there. I guess I'm just wondering, is that something that you expect to revisit, you know, in the second half of this year from a guidance standpoint? I'm just wondering how we should be thinking about the ramp up there, as it relates to consolidated production.

Yep. Thanks very much for the question, Jake. Yeah, basically, you know, the project development at Fox is going very well. We're more or less on schedule. We broke through into the second level a couple of weeks ago. We're breaking into the fourth level, you know, before the end of this month. The headings over towards where the mining is gonna start are advancing at the right pace, you know, about in the two headings, about 14 meters a day. We, you know, will see production from there in the second half of this year. What we're hoping is that the What we're planning, I guess, is that the Froome Mine is gonna kind of fade out and then at the same time as we're ramping up at Stock. We're in the midst of acquiring the equipment for the operation and, you know, so that once we get out to the ore, we'll be ready to start the mining operation.

Okay. That's helpful. Just on the M&A front, I mean, Rob, you just mentioned you've been fairly active investing in juniors and picking up land packages surrounding some of your mines. Do you feel, you know, you have your plate full with the internal growth that you've laid out? Or are you seeing any attractive larger producing bolt-on type acquisition opportunities out there in this type of environment?

That's a good question, Jake. When you look at the performance of juniors relative to the producers and relative to gold, they're still lagging far behind in terms of performance. We've been concentrating on companies that have properties either adjacent or in close proximity to our existing operations that would allow us to extend the life that we believe have potential to grow and aren't expensive to acquire. We're open to other opportunities. You never want to issue a lot of stock and dilute your position, but we're building our production. Right now we can see more than a doubling by 2030, assuming all the projects go ahead as planned. I don't think I want to stop there.

The metal markets are. I see the gold price, the silver price, the copper price are those commodities getting in short supply, and demand is increasing. I see higher prices as we go forward. Want a position on McEwen benefit from that.

Got it. Okay. That's all for me. Thanks again, guys.

Thanks, Jake.

Your next question comes from the line of Joseph Reagor from Roth Capital Partners. Your line is open.

Hi, Joe. How's it going?

Hey, Rob. I'm looking forward to seeing you in a week or so. I guess it's just kind of following up on Jake's question about Fox. Will you guys still report the production from there? It just won't be considered part of your ounces.

That are commercial, so therefore it's not in the guide. Is that the rationale there?

Yeah. This is Jeff, Vice President, Finance here. Yeah, I think that would be the expectation that we would start to report pre-commercial production analysis from stock partway through the year when we start expecting to see that come through. At this time, because it is pre-commercial production, we're not giving production or cost guidance on those notes.

Okay. Yeah, it's helpful. Then, over at Gold Bar, saw the new Lookout resource. Can you remind us, like, where Gold Bar is at as far as the remaining mine life at this point?

Yes. Yeah, the mine life at Gold Bar, as we know, it goes into the 2030 or 2030s. I would say, you know, we're doing an extensive amount of diamond drilling and exploration drilling on, you know, ground, you know, all around the Gold Bar site. At the same time, we're doing an extensive amount of drilling on the Timberline assets. You know, that is basically in progress right now on an exploration basis. We're also doing some mine planning, and we're also doing some permitting work on those sites. As soon as that, you know, we get all of the permits, there are areas there that are amenable to open pit mining.

You know, what our intention is at this point is we would build a small or small to medium-sized leach pad on those sites and leach the material at the site. Meanwhile, the plant will be very, very small because all we'll do is circulate a cyanide solution, and then we'll take the carbon back out to Gold Bar. We won't have to build a plant there. All we'll have is a leach pad and a circulation system. There'll also be some sumps and so on for storm events and that kind of thing. Basically, it'll be an operating mine without much infrastructure.

Okay. That makes sense.

Kind of one final thing.

Go ahead.

I was just going to ask Ian to comment on the resources.

Yeah.

The one thing I would take into account is what we refer to as Trinity Ridge. It's actually below the existing pits at Gold Bar. When Bill talks about, you know, the current mine life 2000 into the 2030s, we then see it expanding much beyond that as Trinity Ridge is taking into account mineralization that we know it exists, does not have a resource, but it's directly below where we're mining today.

Okay.

We'll have resources.

Yeah. We're currently doing a drill program right now. There are 150 drill holes approximately. We're about, you know, a third of the way through. Once we finish that program and have the assays, we're gonna be calculating the Trinity Ridge resource while we're doing metallurgical test work on that as well. We see that Gold Bar just dovetailing into a much larger pit.

Cool. That makes sense. Last thing, just on MSC, now there's actually dividends coming out of it. Is there an opportunity to reopen discussions with Hochschild for one of you to buy the other one out there and consolidate that asset?

Well, there's been rumors they wanted to sell it from time to time, but I think as the price has gone up, that desire to sell has sort of faded away. They were gathering lots of cash to cover off the closure costs, and they've now exceeded what they thought they needed. They still have an active exploration program keep going. It's a prolific area and right next to Cerro Negro.

The price is.

On your end, Rob, would you consider monetizing that and redeploying the capital elsewhere?

At the right price, Joe.

Oh, okay. Fair enough. I'll turn it over. Thank you.

Thank you.

Your next question comes from a line of Jeremy Hoy from Canaccord Genuity. Your line is open.

Hello, Jeremy.

Hi, Rob and team. Thanks very much for taking my questions. I guess I'll start with, you know, there's a lot of growth projects on the go. It's rapidly evolving, and it strikes me there's a lot of catalysts coming up this year. Could you walk us through the capital expenditures in 2026 and how those are divided across the assets? If you can comment on 2027 or 2028, that'd be helpful as well for the model in front.

Certainly. I'll ask Jeff to address that.

Sure. We expect the bulk of our capital expenditures this year to really be focused on the Fox Complex, so really looking at the Stock Mine. I think in terms of remaining CapEx through 2026 to complete, I think we're looking at sort of mid-$50-$60 million to finish, possibly less. We are also looking at Heap leach expansion at Gold Bar, which will take about $12 million this year. We're also looking at Mexico in terms of the plant refurbishment and bringing that back online, about $25 million there.

Okay, great. That's very helpful.

That gets you to about $100 million. I think what you'll see is as we move forward with Tartan and Grey Fox, you know, the next few years will be around $100, you know, that same $100 million a year.

To be clear, that $100 million, you know, we can calculate what sustaining is expected to be based on the AISC numbers provided. What's the approximate split between sustaining and non-sustaining?

In terms of those capital expenditures, I think the only amounts that we expect to report as sustaining are the Gold Bar figures. Given Stock is a growth project, and we don't expect to bring that into commercial production until 2027, that capital has not been included in our AISC estimates at this time.

Okay, great. That's really helpful. I guess just staying on the same vein of discussion here, again, a lot going on, you know, pretty exciting for the precious metals portfolio. Does this require augmentations to the team? Are you guys building up, on the technical side, the exploration side? Just thinking about, management's capacity to deliver on all these goals.

Perhaps I can answer that. Yeah. Yeah, I mean, we're building up our capabilities in terms of our technical capabilities and our bench strength, you know, as we speak. That has been going on for, you know, not more than six months, and you might even say it started a year ago. Yeah, we have, you know, we have a study group that's centered in Sudbury. The reason we put that there was because, you know, we had some, I guess some people that worked with us in the past and, you know, so we set it up so that they'd be home, and we have really had no more room for them here in Toronto, and they didn't wanna drive down here anyway.

You know, we're also adding key people at all the projects. You know, it's for sure a work in progress. Recently we appointed a person in charge of permitting, environmental and social responsibility. We're building a substantial HR team. You know, we're working with a couple of consultants to help us put more rigor around our internal reporting requirements and so on. Yeah, I mean, we recognize the hurdles that we have if we're gonna build these projects.

Understood. Okay. Well, thank you very much for the color, and I'll step back in the queue.

Thank you, Jeremy.

Thanks.

Your next question comes from a line of Don DeMarco from National Bank. Your line is open.

Hi, Don.

Thank you, operator, and good afternoon, Rob and team. Maybe a question on the Tartan mine. You've got the resource update that's pending. With this update, maybe just in terms of managing expectations, do you plan to start by de-risking this, the existing resource, or could we also see maybe some resource accretion at this early stage?

Yeah. We're taking into account all the drilling that's been done post the 2017 resource. We do expect it to be larger as the vertical extent of Tartan was expanded by about 90%. It's not gonna be an apples-to-apples comparison for a few reasons. The 2017 resource did not use a stope optimization as it was really not a requirement or it was seen as a requirement back in 2017. We are gonna be putting some preliminary stopes around the resource. The second factor that makes it hard to compare is the resource cutoff grade. 2017 used a three gram per ton cutoff. At today's gold price, we're using $3,000 for this resource.

You know, you could theoretically use a much lower cutoff grade, which will increase your ounces as well. Again, the comparison's hard, but we do expect an accretion number over the previous resource, you know, by-

Okay.

You know, I'd say by a reasonable amount.

Okay. Okay, we'll look forward to that. Maybe just some comments on your strategy for M&A. I mean, obviously you've been somewhat active. I mean, Tartan's an example. That was the Paragon looking at these, you know, tactical high ROI opportunities. Should we maybe expect more of these to come, or what is your kind of, you know, your vision on M&A or in the gold sector over the next, you know, year or two to come?

Having greater exposure to precious metals, I think is very positive development if you can find it on an accretive basis. We, I mean, we spend, we have a large expenditure on exploration.

Yep.

We've been meeting success there on our own properties, but we'd like to augment that growth.

If we see...

Okay. Jurisdiction-wise, do you continue to focus on the Americas, I would presume then or Ontario or what, is there any, you know, considerations on where you might be focused?

We've largely focused. Well, we have focused almost exclusively on areas in close proximity to our existing operations. We have the talent in place and don't have to spread ourselves too thinly. If what comes up in our neighborhood, that's a natural fit where you have an opportunity to extend the life, increase your production. But there are other situations that might catch your eye and where you can see considerable growth. We call it opportunistic.

Okay. Well, thanks so much. That's all for me and good luck with the rest of the quarter.

Thank you, Don.

Your next question comes from the line of Jay Goldsmith, a shareholder. Your line is open.

Hi, Rob. Good afternoon. Joined a little late, so I hope this question wasn't asked. Congrats to you and the team on the solid quarter and nice to see the profitability turnaround and stronger balance sheet and progress on Los Azules. Can you update McEwen's stake in Paragon? I think it's like 31% in Paragon Geochemical Laboratories and the photon assay technology. Love to hear how the adoption's going.

I'll ask Ian to speak on Paragon.

Yeah. Just for your background, I did join the board of Paragon when McEwen made its investment. The ownership is slightly below 30%. It's about 28%. You know, McEwen was using Paragon for its assay needs, you know, before we made the investment, so we did see how it was working there. As an industry, you know, it is gaining widespread acceptance. Right now, another supplier of the photon machines is supplying Barrick, and I believe the number is about 18 machines that Barrick is now using worldwide. You know, you are seeing turnaround times for assaying for gold and silver, you know, down as low as six days, high as 10 days versus traditional fire assay you're seeing right now in the industry is running, you know, 3-4 weeks.

The cost between the two is approximately the same. A couple of the key advantages with the photon technology is that the sample that you're able to analyze is much larger. By that, it should be more representative of the actual assay. It's also non-destructive. You're able to use that material for metallurgical test purposes later if you so choose versus having to drill a second hole or another hole. The turnaround time is much faster than, obviously, fire assays. There are many advantages, but you're still seeing throughout the industry, you know, it's still being adopted, but, you know, it's gonna take probably a couple of more years. The more people are turning towards it.

You said Barrick is using it now for the majority of their needs, and we're using it for all of our current needs.

Okay. Exciting to hear. Financial impact for McEwen still a couple of years down the road, you suspect?

Well, there's no real financial impact for us. We do include Paragon as an equity investment into our financial statements, very similar to what we do with McEwen Copper. You know, we're not adding any more capital out of our treasury to it, nor are we receiving any current dividends. The impact right now is purely as a capital gain or loss. Right now, we made the investment at CAD 1.75. You know, we've been trying to help them, you know, realize what a customer wants to see. Because I think you are in a commodities business when you're doing things such as assaying.

What we're trying to stress and work with Paragon is how do you make yours a very customer-oriented business, so you go above and beyond to give the level of service that your competitors are not to win over that business.

Okay. I appreciate that. Thank you so much.

Thank you, Jay.

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

Thank you, operator. Thank you for everyone on the line. We're looking to build a company that provides our shareowners with growing exposure to hard money, gold and silver, and to a critical mineral, copper, a metal critical to modern society. We're moving ahead on that front, and I think once we take McEwen Copper public, there'll be a very positive impact on our balance sheet. Thank you for joining us today.

This concludes today's call. You may now disconnect.