Contango ORE Q1 Financials

0:04 Hey, good morning, good afternoon, good evening, depending on where in the world you're signing in from. Thank you all for joining me today. Today I've got with me Contango's CFO, Mike Clark, and CEO, Rick Van Nuenheiser, to go over Contango's Q1 financials. Mike got top billing because today is about financials, so he'll be the star of today's show. Today, what today's going to go is he's going to give a brief presentation summarizing yesterday's release. Then I've got a few questions, but this is absolutely an interactive event. So please do use the chat button in the bottom right hand of your screen to ask questions for the Contango executives at any time during today's event. We'll try to get to all of them. I imagine we will actually during today's event, so please do make sure you get in the chat. I'll try to ask them in roughly sequential order. Also, today's event is being recorded. It'll probably be in your inbox mid-afternoon Eastern time. It'll also be available on events.six.com and on our YouTube channel. Without further ado, I'm going to go off screen and hand it over to Mike just to summarize yesterday's press release.

0:56 Thanks, Romeo, and good morning and good afternoon.

0:59 I'm just going to spend a few minutes just highlighting the quarter ended March 31st, 2025 and just talk on the Statement of Operations and Balance Sheet. On the Statement of Operations, we recorded US$19M in income from operations, which includes US$22.3M in equity income from the peak Gold JV, which is our 30% ownership in Manchot. We recorded a net loss of US$22.5M for the quarter, which includes an unrealized loss of US$40.5M related to the head contracts. Now, this is primarily driven because Gold started the year at US$2,600 and ended the quarter around US$3,100. We also recorded US$2.7M in interest and finance charges related to debt. At the Manchil operations, we sold a little over 17,000oz of gold with another 3,800oz in recoverable inventory.

1:46 Our cash costs were $13.34 per ounce of Gold sold and our ASIC was $13.74 per ounce of Gold sold. Our 2025 guidance remains at 60,000oz of Gold with an ASIC of about $16.25 as we do expect the ASIC will increase in later quarters due to sustaining capital going up related to replacing tractors on the Oro Hall route, as well as a US$5.7M exploration drill program. On the balance sheet, we completed the quarter with US$35M in cash. We have marketable securities of about US$900,000. Those subsequent to quarter end have increased to about US$4M and that's on our Onyx Gold Corp investment. Our trade payables were US$9M at the end of the quarter And this really related to a Gold shipment that happened on March 31st, as we had to pay the peak Gold subsequent quarter end.

2:38 During the quarter, we made principal repayments of US$13.8M on the facility. And then subsequent to quarter end, we paid another US$8.2M, bringing the facility balance down to US$30M as of today. On the derivative liability, the hedge balance technically didn't change during the quarter. We had 86,000oz to start the quarter and we also finished with that as a balance at the end of the quarter. Now, because Gold went up, the liability did increase, but I will highlight that we did do what's called a carry trade. And so we effectively locked in the April hedge price during the quarter. So we ended up settling that on April 30th. And then finally,

3:19 we have started delivering into the July hedges and we have about 2800 ounces delivered onto those so far. Now I'll just hand it over to Rick. Yeah, thanks, Mike. I think it's been a good quarter. And we'll actually start the second campaign actually started yesterday. So that'll be our May campaign. It'll run roughly 30 days. And so we'll be looking to report on the total anticipated production from that once the campaign ends towards probably mid-June is roughly when it'll end. And we'll have a bit of an update at that time on our, won't be the gold sales, but it'll be an estimate of gold produced.

4:06 And then our Q2 results will probably be what in, Michael, let you comment on that, probably what in July or August? Yep, yep, early August. So things are going well, I think basically, I can safely say that things are going a little better than planned.

4:25 I think the total amount of gold produced was more than planned, roughly 30% or Q1. We do have that gold held in inventory. So, you know, we, they campaign process the gold basically in the middle month of a quarter. It's not exactly in the middle month, so it'll run over and then the gold sales obviously trail that by about 30 days roughly. So

4:53 you'll have to just kind of keep that in mind when you're reading our financials, you'll see there's always probably a golden inventory that's been produced but not sold necessarily. So with that, maybe, Romy, I'll turn it back to you and we can start with Q&A. Awesome. I do have a number of questions. Some of them already reflected in the chat, so I'll meld them together where possible. Mike, I'm going to start with you.

5:19 I was curious if you could give me a little more color around the carry trade and hedge delivery schedule. This reflects a comment in the chat. Wesley asks, hedges remaining, when are you liberated?

5:29 Yeah, it's a good question. And I get it a lot. It's really, it's quite complicated, but we've kind of changed our approach. We have been changing our approach since starting. And I guess I'll just kind of start from the beginning, but the main challenge we have is, you have your hedge delivery schedule, which is kind of once a quarter, we have a maturity date, and that was kind of designed off the feasibility plan or study.

5:52 And so what actually happens though is you end up having shipments every week, pretty much for the whole year, but chunkier ones in the middle of campaigns. And so to better manage cash, what we ended up moving towards is called a carry trade so that we could effectively sell the gold at spot price

6:13 as the shipments occur and use those proceeds to basically pay the JV for the Gold and then wait for the distribution a month or so later, and then use those extra proceeds to settle that hedge in cash with our lenders. So it's a better cash management tool for us with a relatively low cost. And it's basically a cheap form of financing. So what actually happened in the quarter is, as you may recall, we ended up cash settling our January 31st hedge in December. So we effectively had no hedges matured during the quarter, But we did start producing

6:48 in February. So what we did is we ended up delivering, we basically delivered 100% of the April hedge into these carry trades during the quarter. So that was about 12,000oz of Gold. So we started the quarter at 86,000oz of hedges. We finished the quarter with technically 86,000. But when you consider the carry trade, the hedge balance is just below 75,000. And then as of today, we're probably closer to 71,000 as we continue to deliver in July.

7:13 Does that kind of answer your question? Yeah, no, that's great. I think that's a useful extra color. So appreciate it. One question I got just for folks who don't know, and it's popped up in the chat a bit too. Where did the Onyx shares come from that are now worth that $5 million? Yeah. So when we acquired Highgold, they own 5 million shares of Onyx, which was a spun out of High Gold book,

7:34 maybe a year and a half ago. And so we had those on the books. I think when we acquired them, they were probably valued around 5 or 600,000 dollars. We finished a quarter at 900,000. And as of today, the shares are at about 5 Canadian. So those shares are now worth about 5 million Canadian. So we thought we would just put it in the press release to highlight that there's another source of capital for us. Great, and somebody in the chat asked- I'll just add in Romeo, I think, you know, Darwin and the team over at Onyx, or, you know, they've got an interesting project. So we'll keep an eye on that. They're, they just raised some more money to do some more drilling. So I think it's definitely an asset in the books for us. Yeah, there you go. Somebody in the chat asked just for clarity, is that stake now and available for sales security for Contango?

8:22 There's some hooks on it with lockups. So it's, but

8:27 I think anything is possible if we really want it to. I think Onix should consider it in friendly hands. Yeah, there you go. I appreciate that. One question I got is, so the PR, can you discuss that dismissed lawsuit and what it means for both Moncho, but generally for Contango? Yeah, I'll weigh in here. So, yeah, we've had, as you may have known, or we've certainly reported on the Citizens for Safe Communities, a local anti-development group, anti-mining group in Fairbanks, launched a lawsuit to try and shut down the truck haul program.

9:08 And this has been pending for, I think, well over a year. I think it's been almost 2 years now. And they had originally 4 arguments that were before the court, the court dismissed 3 of the 4. And this was the last one that the court had not dismissed,

9:32 but there'd been not really any sort of follow through on the side of citizens for safe communities. So we learned a little bit ago that they were considering dropping the lawsuit and apparently you can't just drop a lawsuit you have to come to a settlement. And so that took a little over a month maybe 2 months somewhere in that time frame for them to settle without prejudice. So

10:00 It's gone. I think this is obviously it's a good thing for the project and for the Montreal project. But it's also I think a good thing for mining in general because if you can't, you know, you have people who are anti-mining

10:17 groups that don't want trucking of ore, that means you can't truck concentrates and maybe you can't truck this or that, that's servicing a mine. So I think it's good that this has gone away and I think it's good not just for our project but also for mining in general in Alaska.

10:35 Great, I appreciate that extra flavor. One question I have is, what will the balance be on the facility by the end of the year? The facility will finish the year around $15 million, just under. Great, I appreciate that. One thing I want to say, obviously, congratulations on beating quarterly guidance. That's really impressive. You mentioned the PR incremental improvements in ore transportation and processing at Fort Knox. And I know, Mike, you alluded to it for sure. But what helped get that significantly lower ASIC of 1374 versus the target of 1625? You want me to start on this and then Rick, you can. Yeah, you go ahead, Mike, and I'll weigh in with my technical. I'll let you talk about the incremental improvements. I'll just comment on our guidance remaining at US$16.25 for ASIC.

11:25 The main driver is that there is going to be more sustaining capital during the quarter. There wasn't a lot in Q1 and there's also going to be an exploration drill program. So the cost basic will go up as a result of that. And so that's what's kind of driving the increase. And so, and we did produce

11:42 more Gold in Q1 and I do expect you'll have strong Q1, Q2 and Q3. And in Q4, I think there's a little less production in that period. And so when you smash those all together, you're going to end up with around $1,600. We still hope to beat that, but we still think that's a reasonable estimate. Yes. On the incremental improvements, I think starting with the bridge weight restrictions are still in place. So that's still part of the day-to-day truck hauling. The improvements are really all about water and whether it's frozen water in the wintertime. And obviously Q1 reflects wintertime operations. And they were basically just knocking the snow and ice off the trucks. When they come down the hill from where the Montreal mine is, Montreal is up on top of a hill. And then basically there's a 20 mile road that connects it to the Alaska highway.

12:38 And that's where most of the snow and ice is picked up is along that,

12:43 you know, it's a mine access road, basically not a paved highway. So at the end of that, they had some cattle guards put in there that was knocking some of the ice and snow off. And then they literally would just run around with a big sledgehammer and knock it off before they got onto the highway. Once you're on the highway, you don't pick up a lot of ice and snow unless it happens to be snowing,

13:04 but it's interior Alaska, so you just really don't get a lot of snow. So that's been 1 incremental improvement. The moisture content of the ore is another one. Obviously in the wintertime, things are frozen, so you don't pick up a lot of moisture. In the summertime, which we're obviously operating now, it's mud that you pick up. And so they've established some wash plants, truck wash stations basically just before they get on the highway as well. So those are all the incremental things. I guess the other one was that'll come into effect for the summertime is that we in the pit, I think there's just more water management in the pit to keep the water away from where you're mining and to keep the water away from where you're stockpiling.

13:56 You know, last year was a startup year and I think people sometimes forget that, you know, this was not your normal mine sequencing of, you know, feeding stuff right into the mill right away. It goes into a stockpile and then it gets transported and stockpiled at the Fort Knox facility. And so It was kind of a long, in that sense, it was a bit of a long startup from, you know, sort of turning on a mill and figuring out how that works. But even a mill typically has a 3 to 6 month startup plan. So anyways, long story short is you learn from, as you're operating, you learn where things are going right, you learn where things are going wrong, and then you put in, make changes to make incremental improvements. That's exactly what's happened.

14:45 It obviously reflects in producing more gold and net lower cost and guidance. So I think it's all been very positive. Great. I got one more on just general strategy before I jump into a quick Johnson track question. I'm curious with gold prices, obviously significantly increasing during Q1, how does Contango balance the benefits of spot prices against hedge obligations? Are there any potential adjustments to the hedging strategy or where your head's at? That's definitely the mic question. That's not 1 I really want to... You know, we look at this obviously a lot. We're currently selling 30% of the Gold at effectively spot price for the year, 70 into the hedges. You can try to get cute and look at swapping out hedges for Gold prepays and At the end of the day, you're getting to the same result with just a different look.

15:43 My focus right now, and I won't speak for Rick, but I think just continuing to deliver into these hedges, get ahead of them as much as we can, try to just manage the carry trades and just trying to keep that 70-30 ratio as we deliver this year and make sure that we're ahead of schedule by the time we get to the end of the year. And we'll finish the year with about 43,000oz in the hedges. Our debt will be down to US$15M. I think this will be less of a concern by the time we get to the end of the year and demonstrate another solid year of production. And they won't just won't be as significant on our balance sheet. Rick, anything you want to add to that? Yes, I'll just say, we're a junior producer. I don't think we want to get cute with betting on Gold. I don't think that would be good for our shareholders. I don't think that's what our shareholders want us to do. I think they want us to look. The hedges are in place because that's the only way you could raise money a couple, you know, 2 or 3 years ago when equity markets were pretty much dead.

16:45 So you know, it is it's it's part of the part of the DNA of the company. And as Mike says, we'll just keep paying down the debt and keep delivering to the hedges. Let's not be cute here and make a big bet on gold going up and it goes down and then you're in a worse spot. So just, you know, kind of business as usual. And I think we'll be in a good spot. I think we're already in a good spot, but I think we'll be obviously in a better spot when we're unhedged. So That'll come soon enough. Liberated as they say in the comments. Liberated. Liberated. Our own liberation day. Yeah. I want to pivot to JohnsonTrack for a quick second. I know we talked about it recently, but I really do want to emphasize really impressive MPV of over 400 million, the current gold prices. I'm curious, as you folks in the room, what are the next key milestones in developing JohnsonTrack?

17:38 More specifically, what's the timeline for permitting that underground access tunnel? Permitting is not the sexy part of the story for sure, but that is the next stage for Johnson Track. That's why we wanted to get the initial assessment out. I still keep wanting to call it a PEA, but the assessment out. You know, To let people know that this is a pretty valuable asset, but as you said, the next stage is permitting the tunnel. And it's a state of Alaska, mine operating permit is technically a mine when you're starting to drive tunnel. You're not producing ore necessarily, but you are mining, you're under OSHA and MSHA and all those things. So we think that'll take about a year.

18:26 It's a state permit, there's no specific federal permitting involved. We already have the access road between camp and the proposed tunnel site

18:37 permitted. So we could build that anytime, but it doesn't really make sense to spend money that building a road and less having it sit there. So We'll get the permits. We think that'll take about a year. At the same time, we're permitting the easement and barge landing site that have been granted to Siri by the federal government. So it's, you know, when you grant an easement, typically that means you're already permitted. So

19:09 it's just the special arrangement that CIRI has with the federal government that they were granted the easements. We have to figure out exactly what the road alignment is. And so you go through sort of the normal permitting parameters. In this case, one of the driving ones is wetlands for your wetlands 404 permit. And the edict there is to minimize impacts to wetlands. The other things that you're paying attention to, just as a responsible

19:38 miner and constructing roads is to minimize impacts to water and fish specifically. So fish passages and making sure that all the, any stream that has fish bearing fish or fish bearing stream that the fish can go back and forth across the river or across the water underneath the road. Barge landing site. I think in general, we've selected the best area for that. We've got to do more work specifically on where that's going to go in the specific design there. We'll be doing work in Tuxhead Channel, specifically to study where the beluga whales are, where they hang out and do they use the channel? Are they north of it? Are they south of it?

20:25 We know they're generally in the area and they are an endangered species. So that's obviously a very important thing for us to understand more. So we'll be doing work on that this summer as well. And so this year's focus in terms of the road access down to the bar site, And that just to cover off, it's about a 20 mile road length, which is almost exactly what Moncho is. So it's just very similar scale. So we'll gather all the information this year and then we can start permitting those formally next year. Awesome. I appreciate the JT update of course. I got one last question that I know you've kind of answered but I just want to keep it clear before we jump into the million questions from the audience.

21:11 With you got strengthened cash position, reduced debt, What are the capital allocation priorities for the remainder of this year? I think Mike kind of covered it. Keep paying the debt down, keep delivering into the hedges. We're going to review our budget here shortly. Next week, Mike and I'll be sitting across the room from each other and we can take a look at, do we have money enough to look at a drill program at Lucky Shot this year? I'd like to, but I also wanna be prudent and make sure we've got plenty of cash in the bank to do what the main business is here, get JohnsonTrack permitted and deliver into the hedges and pay the debt down.

21:57 There's a few other things that we can look at, But I think those are the main order, main business for right now. Awesome. Gonna jump into the chat. We covered some of it, but there's a lot of questions. So bear with me. I'm gonna run through as many as I can. We've covered this a bit, but Jan asks, where's the next likely drilling for Contango going to be? I'd say probably, definitely a lucky shot. I think, you know, if we don't get a drill program going this year, I'm very confident we'll be drilling next year. We're all set up, you know, the underground's permitted there. So it is technically a mine. We have it currently on care and maintenance, but we are caring and maintaining it. So that's my best guess. I mean, I'm saying this separate from Moncho. We've got a $5.7M joint venture program at Moncho and the focus of that drilling is to evaluate targets in and around the current pit.

23:02 They'll be doing a bit of work further afield, but I think the lion's share of the exploration program is in and around the pit there. Obviously, the pit, feasibility level pit was done at, I think, 1450 gold. Gold is almost $2,000 more. It will be very unusual to me to see that that pit doesn't get a little bit bigger, go a little deeper and a little bit more, just go after some of the stuff that obviously didn't make it into the pit at a $1,400 gold price. So I think we won't have results until later in the year. And I don't believe we'll be in a position with that $5.7 million budget to upgrade our resource.

23:52 But if we find some interesting things, I think we'll more than likely continue to focus the effort there going forward. Great. On that exact same topic from the chat, Tate from the Maxim group asks, of that 5.7 million, is it taken out of your share of sales in the JV or do you write a separate check? I'll have Mike answer too, but it's all part of an annual budget that's approved and then so the cash weaves basically that's included in, but you know, before we get a dividend, I guess is the way I would put it. Yeah, so right now, we are guided to getting about $80 million in cash distributions from the JV this year for our 30%. That's done at about $2,800 gold. So that includes kind of our 30% of that $5.7 million program.

24:42 Great, thanks. T-Decker from the chat asks, Eternal question, why is the increase in shorts? Who are these guys? It's an interesting question. Ah, the shorts. We love the shorts. We want to see him hang, but that's another topic. Short answers. I mean, look, I think this is all speculation on my part. And if I were across from him, he might be kicking me. But, you know, look, we were, you know, we got hammered last November with the reduced amount of gold production and the increased cost from what the feasibility said. Again, the feasibility is 3 years old now. So I think that's where these things started.

25:28 I think there was an effort to, once we were down lower, I think there was an effort to boot us off the Russell. So I think that's been some downward continued shorting the stock to boot us off the Russell. And then that's a million shares that the Russell has to sell. I think that's gone away from him in the sense that our share price has gone up because we've we've performed better than than guidance. And we've continued to deliver more gold than than planted and at lower costs. And I think the other direction is, I think the Trump tariff discussions have gone against the Russell valuation and the Russell's gone down. So while the Russell's gone down, we've gone up on a relative basis, which means that lower threshold on the Russell is lower than us being on the cusp sort of thing.

26:24 So I think the shorts are in trouble, and I think today's a good demonstration of that. There you go. Somebody in the chat said, a short squeeze would be lovely. Wouldn't we all agree? There you go. Squeeze them. There you go. Bevan in the chat says, congratulations on a fantastic quarter. Looking for a small bit of clarification on something from the last call. I suggested that you finance Johnson Tract with bank debt and free cash flow so long as gold prices remain robust, just making sure that that's accurate. I saw you just came in a bit broken there, Romi. Can you repeat that? All good. They're just curious on Johnson Tract, you mentioned that last event you suggested you'd finance the project with bank debt and free cash flow, so long as gold prices remained high, just making sure that that's accurate. Yeah, I think so. I mean, look, we're a couple of years away from that decision. So, And just to go through it, so this year, permitting the tunnel, hopefully next year starting to think about building the tunnel.

27:23 And then it's a year to build a tunnel, a year to get the underground drilling in place and completed and a mine plan around. So just straight up, it's at least 3 years away. So we've got time. When I sort of fast forward 3 years from now, we will no longer be hedged. We will have 0 debt, so which means we could take on more debt and we'll be producing in the neighbourhood of 60,000 ounces of gold a year out of Montchaux. So with that sort of as a leader and an assumption, we'd be in a good place to debt finance the balance of the, building the road and the barge landing facility in that. And again, using the DSO model, you're not building a mill and a tailings facility and all that. Now, as I mentioned, we may go buy one and that's something we'll continue to take a look at. We'll look at opportunities to do a DSO direct shipping or model to Asia, that might be an alternative. It is an alternative for us to evaluate, but there are at least 3 or 4 other mills to have discussions with, and those discussions are taking place. We're not in a hurry here.

28:42 We wanna make the right decisions. I kind of like the idea of owning a mill and applying the DSO model in it with a sort of a hub and spoke twist if you will You know delivering our own or to that mill, but maybe finding some other advanced stage projects that might supplement that and extend the mine life or, you know, grade always will displace grade. So if we can find something better out there, we'll certainly go with that. But I don't expect to find a lot of things that are much better than Johnson Track. It is an awesomely good project from a mining standpoint, simple, you know, and good grade. So... There you go. One question from the chat, what gives you personally confidence that Moncho Life of Mine can be extended beyond 2029?

29:31 Yeah, I think just kind of repeating what I said before, but again, the feasibility study pit and I can't remember it was 14 or 1450, but it was one of those 2 numbers that the bottom of the was run on And our costs have not gone up dramatically. I think our life of mine costs is gonna remain 1400. This year is gonna be a bit of a high year. As Mike said, we're buying some more tractors, the trucks, they call them tractors, is a pulling part of the truck and trailer assemblage. So we'll be buying some more of those this year. And we also have a, this is a higher stripping year than average, and this year and next year are much higher than average. And then they go down. So I think we'll continue to see very strong cash flows out of Moncho for the next 4 years.

30:29 And if gold prices are in the neighborhood of where they are, we're going to make a hell of a lot of free cash flow. So we're in a very strong position. Great. And again, we only have 12 million shares outstanding. So when you do this on a cash flow per share basis, I don't see anybody else that's our near neighbor. That's healthy. Now, as I promised, I'm only gonna do 1 bridge question for webinars, so I'm gonna combine a few bridge questions into one, because you mentioned that it's already, there is still the restriction, but is there any chance the weight restriction will be resolved with the states in a timeframe you can comment on? Yeah, I think the, what I can say is that the current plan, now that the annual or the Department of Transportation budget has been approved by the federal government with the matching funds and all that.

31:17 As I understand it, it's scheduled to be repaired. And I shouldn't say repaired, it's not really broken, but just updated. The bridge updates that were planned can now be taking place, they take place a year later than the original plan, but that would be in 2026. Great. One question is when the bank debts paid off, is Contango able to authorize a small, let's say $10 million repurchase? Yeah. Okay. It's talking about a buyback program, right? Oh, yeah, sorry. Yeah. One question just about company marketing. Is there anything to look forward to in regards to sell side coverage, roadshows, et cetera, and then your future? Yeah, so next week, we're actually headed to Las Vegas for the Canaccord Genuity Conference.

32:06 I think we've got over 20 meetings already set up. So, and that's largely an institutional, investors are attending that. So that'll be a good one. It goes quiet in, you know, most of June and July are quiet and then on August. And then we'll start with Beaver Creek. That's sort of the start of the roadshow season, if you will, for between now and the end of the year. It starts with the Beaver Creek Conference. We'll be at the Denver Gold Show in Colorado City or Colorado Springs, sorry. And then I think we've got a few other things. And I think we end the year, we've got some marketing in Europe that we're doing.

32:53 And then we end the year, I think, with the New Orleans Conference. So yeah, we'll be on the road quite a bit this, starting in September. There'll be definitely the summer hiatus for sure. Then racking up miles from Beaver Creek through to the end of the year. There you go. Yeah, exactly. Jared Broffenesh. Yeah, road warriors. Jared Broffenesh from the chat, any plans to initiate a dividend? Not right now. Though Again, the main order of business is paying off the debt and delivering the hedges. I think that's got to stick to our knitting and that basic plan. Share buybacks are interesting. It's another form of compensating shareholders. So those are the things that we'll be thinking about.

33:39 Right. I got 2 tough questions to answer. So answer to the best of your ability. One is the eternal. What do you think the stock is worth? I don't think we're supposed to say that, can we? I don't either. Wait, wait. You're gonna do what you wanna do, so. More than $15, how's that? There you go, Good answer. And Jan asked another, I think impossible to answer question. Are there any active takeover bids for Contango right now? Yeah, short answer is not aware of any. Great. What's Siri's stake in Johnson Tracts? I didn't, sorry, I didn't understand the question. What's Siri's stake in Johnson Tracts? So Siri, they are the landowner.

34:26 So they are they own the mineral in the surface rights on the track that that the deposit is located, the current resource is located on. And they have these special rights with the federal government with regards to access, which is why they've already been granted the easement for the road access to the coast and for a barge facility or port facility is actually technically what it's described as. So those are the basic arrangement that we have with CERI. They do have a right to participate as an equity owner in the project. And I'm sure we'll be having that discussion at some point, but I think that's probably a year away probably.

35:14 And they have royalties. Yeah, sorry, the royalties. As a landowner, they have royalties. Great. 1 really specific question about Johnson Tract. What happens if you come across archaeological sites while you're exploring the project? It's actually a big part of what I'll call permitting. It is an assessment of the archaeological or cultural sites. And obviously that's something that we work closely with CIRION. Again, it's their land. It's their traditional land. So, but basically there's a set protocol for evaluating the access route, the easement if you will. And it's managed overseen by what we refer to as SHPO, which is a state historical, remember what the P and the O stand for, office.

36:12 But they're, so that's the group that sort of manages historical and cultural things of importance, but more important than Chippewa, frankly, is Siri. It's their land, and it's their traditional and cultural heritage. So that's the driver for us and that'll be the driver for the evaluation of where the best place to put that road is. Short answer is if you find, and you have to kind of realize where this area is, it's not on a main trading route or anything for, and Siri's told us this. So, you know, it's in the coastal areas are probably where most people would have been, but certainly up at the mine site, it's definitely out of the way. And, you know, you're right up next to the very, very steep mountains.

37:07 So you're not going to find an old village up there for something like that. But that's a big part of the permitting effort for sure. Yeah, I appreciate that. That's useful info. I know we're not just over time, but coming up on our hard stop. So I got 2 more questions that I'll throw at you. One person in the chat asks, will the derivative liability be declining by approximately 20 million a quarter for the rest of the year? I think that's a little higher. I think, you know, when I looked at the April 30th hedge, I think that represents about US$13M, and that was about 12,000oz. So I think if gold stays where it is, our hedge liability should be cut in half by the end of the year. So that's about $50 million for the year.

37:55 And then it'll gradually go down from there. Great, thanks. One last one from Roger. You know, it's no public options are available for Contango. Do you expect to have options available in the near term? We don't. I mean, the option market, it's an independent thing, right? It's not something we control. And we don't issue options to employees. So yeah, that's why there aren't any options. There's we have some warrants, but they and I don't know. Do you know, Mike, if they trade? No, I'm not. I don't want to do it. They do. Yeah, they're not there, aren't there that many of them, so probably one reason why they don't. 700,000. Yeah, there's about 700,000 of them, and they're all pretty far out of the money.

38:43 And they have about 2 years left. Great. Just going to point to a couple of comments in the chat. People said, what a balance sheet transformation, keep up the good work. Appreciate your time, Rick and Mike. Thanks so much for joining us and talking to folks, answering our questions. I really appreciate it very much and hope to talk to you soon as we have more updates. Thank you. Thanks, Rami. Good to talk to you. Take care.