Flora Wood - Director, IR David Pathe - President and CEO Steve Wood - COO Dean Chambers - CFO

Orest Wowkodaw - Scotiabank Joseph Gallucci - Dundee Greg Barnes - TD Securities Jeffrey Gavarkovs - NorthStream Capital Steve Parsons - National Bank Financial

Thank you, Angel. And thank you to all who dialed in today.

I know this is an unusual time for us. So, thanks for making the time.

With me I have David Pathe, President and CEO; Steve Wood, COO; and Dean Chambers, CFO, all of whom will be speakers on the call. Before we begin, I will direct you to the forward-looking disclaimer, it’s on slide two, and remind you that it applies to both what we say in our prepared remarks and also to the Q&A session.

And with that I will turn the call over to David Pathe.

Good morning, everyone and again thanks to everyone for joining us today. As we have done for the last few quarters now, I’m going to ask Steve Wood to provide a bit of an operational update and then Dean to take you through a few financial and accounting matters and some of the changes in our cash position, before we take your questions.

But before we get to Steve, I just wanted to touch on a few highlights and market developments from my perspective first before we do that. You’ll see on the first slide there, it was an active quarter for us, a number of achievements, both from a balance sheet perspective and then operational perspective, quite active on the debt side.

As we’ve previously announced in July, we concluded the extension to our three series of debentures, extending the maturity on all three of those out to 2021, 2023 and 2025. So, we still have full five years worth runway before our first debenture maturity.

Very good uptake and support from the bondholders for that transaction. I think we had about 94% of the bondholders supporting that or voting in favor of that transaction and in excess of 99% of the bondholders who voted supported the arrangement.

Encouraging from our perspective, about a third, more than a third of bondholders elected to forego the cash consideration and take warrants as their consideration for agreeing to the extension of maturity date. Those warrants were issued with a strike price of the $0.74; and so they are now a little in the money base from where the share price is today.

In August, we concluded the extension or the deferral of the amortization payments from the project financing in Ambatovy. We concluded six principal periods over three years which averaged about 188 million a year, beginning with the payment that was due in June of this year.

So, 2016, 2017 and 2018 payments are now all out deferred towards the end of the term of that loan and the amortization schedule for debt repayment will kick in again in 2019. In the meantime, the project they are just paying interest.

So, those greatly alleviate the cash requirements to Ambatovy as principal repayment had been a big source of the cash requirements from the sponsors in Ambatovy for last couple of years. Steve will speak to operations but a couple of things are there as well.

We did finish construction and successfully started up our acid plant at Moa and Steve will talk more about that. We also got drilling underway on our new oil block, Block 10 in Cuba, which is where we see the future of our own businesses, our existing production sharing contracts material in the next couple of years.

Dean will talk more about the cash position but the other highlight from our perspective in the quarter was a strong quarter ending cash position. Our cash was up about $33 million in the quarter, finishing around$345 million bucks and that is net of about $15 million worth of consent and transaction fees that we paid in the quarter in connection with our debenture date maturity extension.

I am going to move on from there just talk about our businesses generally just for a moment, on the next slide. All I want to really show you here is the relative contribution of our businesses and highlight a distinction between Moa and Ambatovy.

On this chart, on page four, you see our three divisions, Metals, Oil & Gas and Power, and their relative contributions to revenue and our EBITDA. Metals, obviously the size and scope of that business is a bigger contributor to revenue but with nickel prices where they’ve been in the first nine months of this year, we don’t show any EBITDA.

However, when you break that down and split out Moa and Ambatovy, Moa actually despite the low nickel price, and I think we averaged about 4.20 a pound for the first nine months of the year and actually had positive EBITDA; and the Ambatovy negative EBITDA on the operating losses there close to our income statement at the 40% rate but of course to us, it’s non-cash at the moment as we’re not contributing any cash to Ambatovy project at the moment. Our other businesses show revenue and strong EBITDA, so across the board our businesses that actually affect our cash were EBITDA positive, and Dean will touch on that a bit more when it comes update his remarks.

I wanted to talk a little bit about the nickel market and the cobalt market. You’ll see again there, I think we showed you this chart last quarter as well, the spot nickel price for the year plotted against some moving averages.

Nickel prices moved up a bit more significantly this quarter. I think we reached a high at 4.94 on the spot basis in August, and we’ve kind of been bouncing around between 4.50, 4.60, 4.70, 4.80 for much of the quarter.

A couple of factors driving that. We’ve experienced pretty solid demand all the way through this period but we’re well off of the lows in the 3.50, 3.60 range that we saw in the first quarter of this year.

Strong stainless demand is helping drive that nickel price as is some news out of Philippines with some potential closures of nickel mines there. I think at the moment, the market is just of going along at kind of range bound between that 4.50 and 4.80 mark.

We’ve seen some support at the 4.50 mark, which we’re encouraged by and we would like to think at this point the best, the worst of the nickel price’s behind us; theirs is an upside potential from there. I’ll get to the cash cost curve and what that looks like in the nickel industry in a moment but before I do, I want to touch on cobalt a bit as well and show you what the spot cobalt price looks like for the last 12 months relative to some moving averages as well.

We’ve had an increasing number of questions on cobalt from investors in the last couple of months and so, we wanted to just highlight and draw your attention to this a little bit. There seems to be increased interest in cobalt generally, driven in part by greater expectations around electric vehicles and then battery demand and what that means for the cobalt market?

From our perspective, you’ll see that the price and shape of the spot price for the last 12 months on cobalt is not just similar to what we’ve seen in nickel. Cobalt is up 19% year-to-date.

We’ve seen solid demand but I can’t tell you really that we’ve seen a real exposure in demand from batteries yet but there is lots of expectations out there. We certainly don’t have any trouble placing our cobalt products.

And we think we’re well-positioned from the cobalt we produce to capitalize on any uptick you see in cobalt demand in the future. One other interesting thing I have that I don’t know is really well-appreciated out there about the cobalt market, it’s obviously a much smaller market than nickel, again.

And cobalt’s on the supply side ability to react to increases in demand is really quite limited on the basis that the vast majority of cobalt production isn’t really primary production, it’s most of the world’s cobalt productions like ours, it’s really a byproduct. The vast majority of cobalt production is a byproduct of nickel, cobalt production.

And so, cobalt supply is really driven more by nickel market and the copper market and operating -- and nickel supply than it is cobalt demand. So, to the extent there isn’t increase in demand for cobalt in the years ahead, there is limited ability for the cobalt market to respond to that increasing supply unless the nickel and copper markets really support it.

Moving on to the nickel cash cost curve on page seven, we’ve shown you this a number of times now and you see our operations spotted there. With the year today pricing, this cost curve represents year-to-date industry cost curve as best as we can put it together.

You see our operations there, they are firmly in the second quartile at Moa. We are still working to get that down towards that bottom quartile.

Ambatovy is higher than where we expected to be based on some of the production issues we’ve had; you read about in the press release, but we still see the ability over time to get that Ambatovy cost number down into the range where Moa is. The other point you’ll see there is that we highlighted in green, there is a huge chunk of the nickel market with cash cost in the 4.40 to 4.80, around 30% of the total nickel production.

And that’s roughly the range that we’ve been trading in the last quarter. Based on the year-to-date price of about 4.20 a pound, you’ve still got most of the 60% of the nickel market producers underwater just on a cash margin basis.

Never mind, again, their financing costs and sustaining capital and other factors, and that’s not a situation we believe is sustainable. Even in the range we are now, you’ve got a big chunk of the nickel market that’s underwater or basically managing this great [ph] to more or less flat on a margin basis and not being able to cover the other costs in running their business.

Interesting from a market perspective encouragingly to us is that I think in 2016, the general analyst consensus is now that for this year the nickel market will actually be in a slight deficit. That’s the first time we’ve seen that since 2011 or 2012 and they are focusing [ph] to have this fixed [ph] now for the next few years on the basis that there is not much in the supply to come back in to meet that demand.

That leaves us continuing to have our beliefs in the longer term fundamentals of the nickel market and we continue to focus on production in our business to drive down costs and maximize our production while we wait for that to occur. Steve will talk more again about where we are from a nickel production perspective in a moment.

The last thing I wanted to jus to give you a quick update on, I don’t have a slide for this but it was really just to talk a little bit about Ambatovy and where we are in our discussions with our partners. Those of you who have been following so long for the last year will be well aware now of our story 40 for 12 issue and the fact that we haven’t put in cash into Ambatovy this year or frankly since we achieved financial completion last year on the basis that although we are 40% shareholder, the share of our future distributions goes to services and those partner loans effectively reduces us to a 12% economic interest.

We’ve been raising those issues now really since the beginning of the year and we’ve had ongoing discussions with our partners. For the first eight months of the year, really those negotiations and discussions with our partners were focused on the discussions with the project financing lenders to get the principal deferrals in place and that combined the announcement we made in August that I touched on at the beginning to defer three years worth of principal amount on the project financing agreements.

In the last couple of months,, there have been more focused conversations amongst the partners on how we can rework the capital structure to recognize this economic reality of our notional 40% interest through 12% actual economic interest. Dean and I were over in Tokyo a couple of weeks ago, and Dean and his team have had a couple of rounds of meetings, and there are more scheduled for November but we’re not yet to the point where we have a solution.

Out of this, we’re looking to try and reshape the capital structure that is something that more accurately reflects our what we now see as our true economic interest. We’d like to get those Ambatovy non-recourse loans off our balance sheet as really they just represent 28% of the equity in the project now, and get to a simpler and easier to understand structure that would more accurately allow us to -- more accurately present the economic realities of Ambatovy for us and our financial statements, income statement and balance sheet in particular.

Our partners continue to be interested in engaging in the conversation; they’d like to see us return to a status as a more normal partner. They certainly value us as operator and they express the desire to see us continue as operator, and those conversations as I said continue.

I wish I had more to tell you today, the pace is certainly frustrating somewhat from our perspective but they are complicated issues and we they continue to work through them. You’ll see in the press today we’ve announced an extension of the waiver to us as a development shareholder as a defaulting shareholder in the shareholders’ agreement to January 15th, so in the middle of January next year.

I am hoping that in that timeframe we’ll see some real tangible progress here. The reality is that we don’t -- I expect there is a decent possibility that these conversations could well evolve into a conversation around how we might look to exit Amatovy rather than we work this capital structure if we can’t get to a solution that works for us.

Just to touch on the accounting treatment of Ambatovy because it does show up in a lot of places in our income statement and balance sheet. You saw earlier, I mentioned the impact of running 40% of Ambatovy’s EBITDA through our income statement.

We continue to accrue interest and compound interest on those partner loans, despite the fact that it’s unlikely those loans will get repaid. It does create a lot of distortions on our balance sheet.

But from our perspective, the way we look at it these days is that from a cash flow perspective, it’s completely flat to us. There has been no cash into Ambatovy this year and no cash out.

And pending any change in the capital structure from where it stands today, our current expectation is that that will be the case that will be the same next year as there will be no cash in and no cash out. We hope to have more to update you on between now and the end of the year or between now and when that deadline expires but that is just the context of where we stand on our partner discussions at the moment.

And with that, I am going to turn it over to Steve to talk about a few operational matters.

Thanks, Dave. And good morning everybody.

I’ll start with slide eight. As usual I’ll start with a little information on safety.

We’ve recently had two events that I would like to highlight to you. First of all, Ambatovy reached a tremendous milestone, one year without a lost time injury, and that marks a significant safety culture turnaround there.

This peer-leading performance in Africa is currently being celebrated at the operations in the communities in which we’re operating there. We are very proud of the team.

Second, Moa came through a category for hurricane relatively on the scale, as you know. Cuba received well-deserved praise from the United Nation’s Secretary General Ban Ki-moon for their emergency preparedness and response efforts.

Most of the impact on Moa was confined to property damage and some temporarily supply delivery delays. We had three days of shutdown during the worst of the storm with virtually no one on site, followed by an orderly return to a normal operations.

So, now, I’d like to move on to slide nine. Let me start with Ambatovy as I think the production shortfall there is more than expected.

It is the basis for the lowering guidance for this year. On the cost side, production volumes had a significant impact on unit costs.

Had we hit production targets, NDCC would have been closer to $4 on a normalized basis. In September for example, we produced 4,185 tons in the NDCC within the range of -- within the high $3 range.

We reduced the finished nickel guidance this year to 40,000 to 42,000 tons on a 100% basis to reflect the challenges coming out of the advanced shutdown that was had during the quarter and some of equipment reliability issues. Although July and August were well below target, September was the best month we’ve seen so far this year.

We continue to work on improving reliability by changing out failure prone components, as well as improving our maintenance systems there. My only other comment on Ambatovy refers to a point that an analyst raised last year when Ambatovy’s realized cobalt price was below the quarterly average and well-below Moa’s.

This quarter, the reverse is the case as Ambatovy’s realized cobalt price was above the quarterly average and $1 per pound higher than Moa’s. This is due to provisional pricing and longer shipment times for Ambatovy.

Now on to Moa. Moa’s production has been steady, increasing slightly each quarter this year and down around 5% this quarter versus the same quarter last year.

We put out a press release earlier about the operations and Hurricane Matthew. We have no change to production guidance at this time but we do expect to be around the low end of the range for nickel with cobalt less impacted due to third party feeds.

NDCC this quarter is probably a bit higher than you expected. Due to the impact of the seasonal fertilizer credit in Q2, it is appropriate to compare Q3 NDCC to Q1.

In Q1, the amount under other was a $0.19 credit, whereas this quarter it’s a charge of $0.05, reflecting the fact that the fertilizer credit is lower than the impact of the marketing netbacks. Fertilizer average realized prices were $288 a ton and Moa has not experienced these kinds of prices below $300 since 2010.

The driver here is the sharp decline in nitrogen fertilizer prices in the Gulf, which have worked their way through the fertilizer market. As a result, there has been a surplus in supply of product, which has motivated other producers to offer additional price discounts, further impacting our prices.

Normally we see a decline in fall [ph] pricing but this drop was earlier and more significant than in past years. Next, I would like to discuss our oil and gas, and power division that’s on slide 10.

The oil production from the original TSCs was steady, and that has been the case all year. We did record an impairment on the PSC extensions down to a negligible recoverable value as these wells count for no more than about 100 barrels per day of our total 15,000 barrels of oil per day.

Average realized prices have improved significantly over the course of the year, reflecting improved WTI prices but also narrowing of the gap between WTI and Fuel Oil 6. Fuel Oil 6 is now around 73% of WTI prices and that’s roughly where we expect it to be with WTI around $50.

Unit operating costs are better than expected, given normal decline rates in the reservoir, as we’ve been successful in our cost reduction initiatives. The main story in oil is that we’ve started drilling in Block 10, and we expect to continue drilling through December and then enter testing.

We should be in a position to announce first results early in the New Year. On power, you’ll see our press release that we’ve -- that we’re expecting full year unit operating costs to be about $1.50 per megawatt hour higher than they averaged in the full year of 2015, but still a steady, good margin business for us.

The pipeline construction is now complete, and we expect production to increase by around 8% with this new pipeline operational. Dean will speak to the energy receipts in his talk.

And with that I’d like to turn it over to him. Dean?

Thanks, Steve and good day to everyone on the call. As David mentioned at the beginning of this call, the third quarter was an eventful quarter on the financing front as we completed two significant transactions that are allowing us to manage our liquidity through this phase of the commodity cycle.

The first transaction is the deferral of principal of the Ambatovy senior debt. The lenders agreed to defer up to six principal payments totaling $565 million, beginning of the principal payment originally due on June 15th.

Regular principal payments were scheduled to be $188 million per year. And clearly at current production levels and current nickel prices, Ambatovy is not generating sufficient free cash flow to service this debt.

And the partner is needed fund [ph] the difference. Interest of approximately $56 million per year will continue to be paid in cash.

This in [ph] principal will release some of the pressure on our partners to provide further funding during the deferral period. And despite our non-funding status, it does have an economic impact on Sherritt.

As you know, Sherritt has not funded cash calls since the achievement of financial completion on the senior debt in 2015 due to the 40 for 12 issue. However, our partners have provided a $153 million of post financial completions funding to Ambatovy since December 2015.

And in this discussion all my numbers referred to are on a 100% basis and in U.S. dollars.

So, let’s look at how the funding provided by our partners works and the impact of the cash calls that Sherritt has not funded. Slide 12 probably looks familiar to most of you because it is a slide we’ve used for a while to illustrate how distributable cash from Ambatovy is treated and to describe the 40 for 12 issue.

However, we’ve added a new box on the waterfall, titled subordinated loans, post financial completion. As you might expect, the post financial completion funding provided by our partners is repaid in priority to distributions paid to all three shareholders.

In addition, this tranche of funding earns interest at LIBOR plus 8%. These loans are shown on a new line in Canadian dollars on the Ambatovy balance sheet contained in note six of our financial statements, and of course impacts our investment in an associate line on our consolidated balance sheet.

And the Canadian dollar equivalent is approximately $203 million. A $153 million provided by our partners was based on $255 million of cash calls, meaning that Sherritt did not fund U.S.

$102 million based on our 40% equity interest. This amount that Sherritt owes to Ambatovy is reflected on our balance sheet in other financial liabilities in Canadian dollars of approximately 134 million Canadian dollars.

Correspondingly in other financial assets, we show the right to receive future distributions separately from the subordinated loans receivable because funding has not been provided. This amount owing by Sherritt may be subtractive for future distributions or other amounts of the Sherritt, and of course we could always pay this amount in cash.

In our second quarter disclosure, we indicated these amounts accrue interest at LIBOR plus 3%. Based on our current arrangements amongst the partners, there is now no interest accruing on these unfunded amounts.

In summary, interest accrues at LIBOR plus 8% on amounts funded by our partners since financial completion and is repaid in priority to normal distributions on pre-completion funding. And amounts that Sherritt has not funded, remain owed to Ambatovy but these amounts do not increase with interest.

The second major financial transaction of the quarter was the three-year extension of maturities of all three series of our public debentures, as highlighted on slide 13. Our next maturity of $220 million is not due until the fourth quarter of 2021.

You will recall that we repurchased $30 million of the 2021 maturity at a discount in an open market purchase, which is why its lower than the other maturities. In this maturity extension, no changes were made to the coupon rates or the covenant package.

Cash transaction costs were $14.6 million in the quarter. This amount includes the 2% consent fee payable to those noteholders who consented and elected to receive a cash consent fee as well as other transaction costs.

In addition, 36% of noteholders elected to receive warrants instead of the cash consent fee. As a result, $19.1 million warrants have been issued with a value at quarter end of $0.43 per warrant, based on the Black-Scholes calculation for total value of $8.2 million.

This amount is included in equity and does not have to be mark-to-market each reporting period. Finally, let’s talk about the results of the quarter.

Today, we announced an adjusted net loss from continuing operations for the quarter of a $104 million or $0.35 per share compared to a loss of $0.39 per share in the second quarter. The only adjustments this quarter were at $12.8 million unrealized foreign exchange loss and $6.6 million aftertax impairment in our oil and gas business, offset marginally by a $2.9 million adjustment for VAT collections at Ambatovy.

The impairment relates to the Puerto Escondido/Yumuri extension cash generating unit. And that unit has been written down to negligible value.

There are no indicators of impairment in the other cash generating units in our oil and gas business. And I do not anticipate any further impairments in oil and gas absent a significant drop in oil prices.

The most important item of course is liquidity. Slide 14 shows a cash waterfall, highlighting the changes in our balance sheet cash and short-term investments since yearend.

During the third quarter, our liquidity improved by almost $33 million to $355 million. In addition to operating results, our improved cash balance reflects strong collection of the Cuban energy receivables and fertilizer prepayments.

Almost U.S. $60 million of Cuban energy payments were received in the quarter, reducing our overdue receivables by U.S.

$39 million to approximately U.S. $32 million.

A quick comment on the seasonality of our fertilizer business in the Moa JV and Fort Site division. Steve already talked about fertilizers earlier on this call.

We have mentioned these credits over the last several quarters since fertilizer sales are more material during periods of low nickel and oil prices. We typically receive prepayments in the third or fourth quarters of the year but sales are generally in the second quarter and fourth quarter of the year.

Prepayments are blocked in deferred revenue. As a result prepayments tend to have a positive impact on cash in the second half of the year, but the impact on revenue, earnings and byproduct credits is most noticeable in the second and fourth quarters.

Looking at slide 14, you can see that our cash balance has decline by $90 million year-to-date. The largest single impact is the $62 million used to repay $75 million of debt.

In fact, if you take our debt repayment plus the transaction costs for the extension of the bond maturities, both non-routine items, it explains $77 million of the $90 million decline in cash. If you add the corporate use of cash which includes debenture interest plus debt repayment, plus debenture transaction fees, it equals a $136 million, which highlights that our operating units combined with non-funding of Ambatovy has been cash flow positive despite weak commodity prices.

That concludes my remarks and I will turn the call back to Dave.

The last slide you see from us there is a slide you see each quarter in terms of the 2016 strategic priorities that we’ve announced at the beginning of the year. And I just wanted to highlight some of the progress ahead of those and it’s really some of the things I’ve touched on at the outset of this call.

Focusing on our core nickel business, our year-to-date net direct cash cots in both the operations is down compared to last year. We have completed the construction of our Moa asset plant, which we said was a priority for us this year and we’ve seen a much improved health and safety record, particularly Ambatovy.

On Cuban energy business, our focus is on Block 10. We’re now into the joint campaign there that we hope to have some news for you on in the early New Year.

And it was an active quarter from the balance sheet perspective with the deferrals on both, Ambatovy, budget financing, and the maturity dates on our debentures. So, we are working our way at the things that we believe we have some control over and we are doing it in a pretty difficult environment from a commodity price perspective.

But that’s where our focus has been and where our focus will continue to be. So, with that, operator, we’ll open up the call and take any questions anybody may have.

I wanted to delve a bit deeper into the Ambatovy 40 for 12 issue. You set up some expectations that you don’t anticipate any funding for Ambatovy next year.

But can you give us a sense of what kind of outcome you’re looking to achieve in this sort of partnering, restructuring? Is it something like 12 for 12 or is it carried interest?

I guess that’s where the market is sort of partially struggling in terms of -- you did mention that if there was an amicable restructuring, you -- one potential outcome is that you may exit the actual mine. I’m just curious what you’re trying to achieve through this?

Look, Ambatovy, we’ve been involved in Ambatovy for a long time. We’re proud of what we’ve done there from a ramping up perspective and the achievement of financial completion last year really gave us the opportunity to -- with a bit more flexibility to look at what actually made sense for us going forward as to the rate at which it was consuming cash didn’t make sense.

And the 40 for 12, the issue made no rational sense for us to continue to contribute at a 40% rate when we only get 12% of the return. In addition, Ambatovy, we’ve given that 40% shareholding that is really now just notional, creates all sorts of perversions in our financial statements including those non-recourse loans that will continue to compound interest and loom larger and larger on our balance sheet.

Our primary objective is to try and clean all that up and really get to an economic interest that -- and a capital -- simplified capital structure that more accurately reflects that economic reality of the 12%. I think we would contemplate funding in the right circumstances, if the overall package made sense, but we also are mindful that it needs to make economic sense.

And we can’t in this nickel and commodity environment take on an open ended funding commitment without having some assurance that it’s quantifiable in a way that we can afford and won’t impair all the balance sheet. For all we’ve achieved in Ambatovy, there’s lots of work to be done there yet to get that up and running and up towards full capacity.

And we would love to be involved in that but it needs to make economic sense, and it has to be an economic rational decision, not one based on sentimentality or one based on how much we’ve spent in the past. I think the challenge with the partners is that they’re -- see the value that we bring as operator as well, but in fairness to them, their economics aren’t terribly compelling on the projects at the moment either, and that it makes for difficult conversations.

They are still amicable and friendly conversations but we would like to get back to something that more -- that simplifies the capital structure to reflect the economic reality in a way that we can be confident that it’s not going to threaten the balance sheet.

And if you just refuse to fund your share and sort of the stalemate continues, would your share just continue to be diluted based on the overall cost of the investment in the asset?

That would depend on I suppose ultimately what it looks like in terms of -- because I mean there have to be some conversations with our partners as to what that ultimately would like, even if it’s not a situation that seems to be working in the capital structure for us to fund it again. But, if there’s no incentive and no rational basis on which we could every justify continuing to fund at a 40% rate when we only see 12% of the return, our balance sheet simply can’t afford that.

So, what happens to our interest at the moment and what may well continue to happen if there isn’t some other resolution to this is that other money continues to go in and it lines up more and more money in front of us. As Dean highlighted that we’ll take a 100% of the distributions from the project until we get back on an even footing before we even see the 12% of our 40%.

Good morning, guys. Just to continue on Orest’s line of questioning.

Is it safe to say -- or this is the first time I actually hear you guys say that exiting is an option. And on that note, can we assume that the negotiations with the partners are getting to probably a climax here in terms of making a decision?

I still don’t think that is the most likely outcome here, but I want you to understand that we are being economically and rationally realistic about this. I think amongst all the partners, there is a recognition and an understanding that we’ve been at his for most of this year and that being in a perpetual state of negotiations is not in anybody’s interest.

I would commend our partners that they have been willing to engage on this. And as I say, we’ve had a couple of rounds of meetings, and there are more scheduled.

And they are actively looking for a solution and I truly believe motivated to find a solution to this, but they are difficult issues. But I am hopeful that this will kind of come to what it can be in the next couple or three months here that we have with this new extension because there is an appreciation I think amongst all the partners.

That is what is in the best interest of all the partners and the project itself.

And just maybe then one other question, and I am not sure if you can answer but any color. I mean, is there a point you think where the partner, Sumi and KORES don’t want to fund this anymore?

I mean, has that come up in the discussions in a sense that they want to walk away as well or has that never been an option discussed?

The partners have always had a great -- a very strong commitment to the project and are great believers in the project. And as part of the deal with the -- on the principal deferral on the project financing down there, in fact Sumitomo and KORES between them have made a commitment to the lenders to fund upto another 370 million in equity contribution to the project over the deferral period.

So, they are great believers in the long-term capability and potential of the project, and their funding commitment that they’ve made to the lenders is backing that up. So, there hasn’t been much suggestion to that.

No, Joe.

Dave, you did mention that you don’t anticipate any cash funding from Ambatovy in 2017 as well. Is that even if you get a some kind of 12 of 12 agreements in place?

I think if we do get some sort of agreement, we could see and certainly we’d be prepared to contemplate some level of funding, more commensurate with their economic interest, but it would only occur in circumstances where there was a broader deal that would address the capital structure of Ambatovy and some of our balance sheet issues with getting all that non-recourse debt off the balance sheet.

To be clear, 12 for 12 means you’d get 12% of the economic interest and you would have 12% of the liabilities?

Right. I mean, you could see a scenario anyway, without trying to prejudge all this how it plays out that we would surrender or somehow deal with 28% of our equity to cancel out the non-recourse loans and then be left with the 12% equity interest and take on some funding obligation in respect of that interest.

But another of our concerns is ensuring that that’s not an open ended commitment that we wouldn’t ultimately be able to match without impairing our balance sheet.

Just on Ambatovy on an operating basis, what were the other issues you had ex the pipeline blockage in terms of the reliability and ramping up?

There is some issues coming out of the pipeline blockage, the pipeline blockage did run into July, and so we had quite a very poor July and I think we announced the July production when we did our Q2 release. Some ramp up issues extended into August that now led us do not have a strong an operating August as we were looking for on the basis of some of the equipment failures that have caused us issues in the past, some of it was rubber line pipe, some of it was just seal failures and pump failures that as a result -- that’s coming out of the shutdown; by September, we were up and running well and the piece north of 80% in September and obviously we are now working and hoping for us for strong Q4 quarter.

Are you still confident that you can run Ambatovy consistently at nameplate capacity?

We’ve obviously had some issues there and the tailings pipe blockage was the biggest and we’ve had some equipment reliability issues there that we are still working to get ahead. There is still a tremendous amount of work to be done at Ambatovy on asset reliability and on process and chemistry and nickel recoveries as we get closer and closer to full capacity of those, those incremental improvements are smaller and more difficult.

There’s not any one thing. And as they get from 80 to 85 upto closer to 95 and 100, it’s a million little things.

But that said, there is still nothing to our mind that it is a real structure impediment in Ambatovy’s capability of doing that. We don’t anticipate that it needs any dramatic injections of new capital to it to achieve that.

We still believe that all the kit on the ground that you’ve seen should be capable of that. But it would be starting, and given its history in the last couple of three quarters here, we’re under no illusions that there’s not a tremendous amount of work to be done there yet.

And I guess, is there some element given the environment we are in and how challenging it is that there maybe not as much cash capital being putting to the project as there otherwise would be that may exacerbate some of these issues?

To give our partners credit once again, they have -- and their willingness to fund is frankly what’s driving the capital budget this year. To give them their due, they have been willing to put in the capital that the operating team on the ground there and that we have looked -- and we’ve suggested in terms if you want to get to production, they are willing to commit capital for this year and next for step out projects to move incrementally towards that 60,000 tons, they are taking a very long term view of this and willing to spend the money it takes to make it grow over it.

I guess finally the 330 million they committed under the debt deferral and addition equity into the project, how long that current metal price is -- does that -- or would that last?

Well, with the principal deferral, it helps a lot. And you’ve seen few [ph] in the last couple of years before financial completion when we were contributing, the biggest single driver of cash into Ambatovy was not the operating losses but the 188 million in principal repayments.

And now that there’s a three reprieve on that, it takes a lot of pressure of it. You don’t have to be a long way north of where we’re now to see scenarios in the next couple of years where it actually doesn’t take a kind of new responsive funding to keep it going.

But it is -- there’s some risk to it both on -- just because of the sheer scale of the operation, both on commodity price and production. And you can move those assumptions around and you can change the cash requirements quite significantly.

But there’re scenarios where we think we can produce next year and nickel price not a long way north of where we are now and it doesn’t really need much cash in 2017. But the downside risk on commodity price or on production makes us leery and conscious of taking on any kind of open-ended funding commitment.

In the quarter, you received quite a large amount for the oil receivables. I was wondering the expectation was that there would be a repayment of roughly 20 million to Energas in the second half of the year.

Can you tell us what expected payments are scheduled for the remainder of 2016?

Yes, predicting timing of Cuban receivables has always been more of an art than a science. We had a very good quarter, particularly in oil and gas in terms of receivables coming in, which was timely, given that the Q2 was a more disappointing quarter.

We’re expecting to receive more cash in the oil business and are still discussing what we can expect in the power business in Q4 with the Cubans. It’s difficult for me to tell you today exactly what we’re going to get.

They do seem to have prioritized oil receivables a bit over the Energas receivables but our history throughout the entire time we’ve been in Cuba in the oil and gas, and the power business is that well, sort of actual timing of receipts has been difficult to predict, invariably they’ve been good on the receivables and we continue to work with them on that basis. I know that doesn’t fully answer your question because I don’t have a number for you, but it’s what we continue to work through with them.

And the 25 million that was provided as a loan for the construction of the asset plant, that’s supposed to mature in January of 2019, is that a bullet payment or will it be amortized over the coming 28 months?

Looking at Dean, there’s an amortization schedule that we’re already into. So, the Moa joint venture has been making periodic principal and interest payments on that loan already, and you’ve got the maturity date there.

So, I don’t know what the outstanding balance is on that loan. And we’re actually at an interesting point where we’re both paying down principal and still continue to draw on it as we clean up the last costs of the asset plant.

I think that Dean tells me that balance on that is 38 million or 40 million right now but that will payout in an amortization schedule in the maturity that you mentioned.

Would you be able to communicate what the adjusted EBITDA sensitivity would be to $1 change in nickel prices for both separately for Moa and Ambatovy?

There is some sensitivity information in the MD&A, I don’t have that to hand. It’s difficult to give an absolute basis.

You can do it on a simple basis just by multiplying the production by the incremental change in the price. It depends on what assumptions you want to make on the underlying input commodities and the byproduct credits in a rising nickel price or decline in nickel price environment as there is some correlation between all those input commodities and byproducts and the nickel price.

But the MD&A is probably good place to look as any for a start on that kind of stuff. I think it’s page us 36 as somebody shows me here, which are some sensitivities on nickel prices on operating costs and exchange rates.

Just on Ambatovy and the discussions with the joint venture partners. Is there a minimum I guess inter project interest that you’d expect for being project operator?

I mean not too many mines are run at 12% ownership interest and operator interest? If for example you’re considering the 12 for 12.

So, to give a minimum number in mind where you would want to just maintain being the operator?

I think you are right, Steve, and the 12 is actually relatively smaller number for an operating interest. So, we don’t think it would make much sense to go lower than that.

I think our partners in an ideal world would like to see us go higher than that but we balance that against what our balance sheet capability is of funding any interest larger than that and the kind of returns that you can expect on the incremental spend going forward from here regardless of how much money we already have invested. So, we don’t have a minimum in mind, but to be honest, it would be difficult to see going much below 12 and then it being worth the effort.

Okay. Well, we’d just like to thank everybody for dialing in and we will talk to you at yearend.

Thanks.