Release Date: March 11, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you provide more details on the seaborne volumes fixed at $111 per ton and where you see the highest return opportunities in the current market? A: Christopher Blanchard, Chief Operating Officer, explained that the $111 figure reflects index-linked prices for January and February, primarily from Asian high-vol contracts that have since ended. The highest returns are seen in the Atlantic market due to freight differentials and near parity with Pacific indices. Current netbacks are around $125 per ton for high-vol and $3 to $5 higher for low-vol.
Q: Regarding growth projects, what is the capital intensity, and what conditions would prompt you to move forward? Is this included in your current CapEx guidance? A: Jeremy Sussman, Chief Financial Officer, stated that the total CapEx guidance is $60 million to $70 million, with about $20 million allocated for growth, split between Elk Creek and Berwind. If market conditions remain weak, CapEx could decrease. Randall Atkins, CEO, added that clarity in market conditions is needed before committing new capital, with modest spending planned for Maben and Berwind expansions.
Q: What is the expected development CapEx for the rare earth project, and what is required for the pilot plant construction? A: Randall Atkins, CEO, mentioned that detailed CapEx and economic information will be provided in the upcoming Fluor techno-economic report. The pilot plant construction will begin later this year, with a $6 million grant from the Wyoming Energy Authority aiding the project. The pilot plant CapEx is included in the current $60 million to $70 million CapEx range.
Q: How sustainable are the recent reductions in unit costs, and could they reverse if met coal prices recover? A: Christopher Blanchard, COO, explained that cost reductions are largely due to transitioning to thicker seams with better geology, which should remain stable. While some sales-related costs may increase with higher prices, structural cost improvements are expected to persist.
Q: Can you clarify the trucking cost savings at the Maben complex and the timeline for further cost reductions? A: Christopher Blanchard, COO, clarified that the $40 per ton trucking cost savings are on a raw basis, with $20 per ton savings realized so far. Additional savings will occur once the rail load-out is built on-site, expected after this calendar year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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