Thank you very much, Victor. Good morning, everyone, and welcome to Southern Copper's third quarter of 2026 results conference call.

At today's conference, I'm accompanied by Mr. Leonardo Contreras, COO of Southern Copper and board member.

Let me start, sir, that we are very pleased to report strong third quarter performance as we hit record highs for net sales, adjusted EBITDA, and net income for the second consecutive quarter. Concurrently, our report will show that Tía María and El Pilar, which are under construction, are expected to add 156,000 tons of refined copper to our total production figures.

With this trend, we will widely surpass the annual production mark of 1 million tons. These outstanding achievements are driven by operating excellence and reflect our commitment to creating long-term value for our stakeholders in a context marked by sustained demand for copper and the other minerals we produce.

Today we will begin with an update on our view of the copper market, and then review Southern Copper's key results related to production, sales, operating costs, financial results, expansion projects, and ESG. After this, we will open the session for questions.

For the copper market, LME copper price increased 44% from an average of $4.24 per pound in the third quarter of 2025 up to $6.41 this past quarter. In the COMEX market, we saw a 34% increase with an average of $6.48 per pound this past quarter.

Based on current supply and demand dynamics, we estimate now a slight copper market surplus for 2026. Copper inventories worldwide, the total combining stock in LME, COMEX, Shanghai, and bonded warehouses, stood at 1,105,000 tons as of October 9 of this year.

We estimate that this inventory can currently cover approximately 14 days of global demand. Now let's look at Southern Copper's production for this past quarter.

Copper represented 74% of our sales in the third quarter of this year. Copper production registered a decrease of 1% compared to the third quarter of 2025 and stood at 232,396 tons in this past quarter.

Our quarterly results reflect a 6% drop in production in Peru, which was driven by a decrease in production at both our Toquepala and Cuajone mines due to lower ore grades and recoveries. These were partially offset by an increase of 2.5% in production at our Mexican operations, which was mainly fueled by higher production at our Buenavista and IMMSA mines.

Our copper smelters and refineries increased their production by 18% and 16%, respectively, in the third quarter. On a year-to-date basis, copper production fell 2.9% in 2026 to stand at 693,602 tons.

This evolution was mainly driven by a decrease in production at our Peruvian mines due to lower ore grade. Year on year, the company smelting and refining facilities increased their production by 16% and 10%, respectively.

For 2026, we expect to produce 918,000 tons of copper, an increase of 0.7% over our initial plan. Molybdenum represented 12% of our sales in the third quarter of 2026 and is our primary byproduct.

Molybdenum prices averaged $32.93 per pound in the quarter, compared to $24.30 in the third quarter of last year. This represents an increase of 36% in price.

Molybdenum production dropped 2% in the third quarter of this year, compared to the same period of 2025. This was mainly driven by lower production at our La Caridad and Buenavista mines, which was largely offset by higher production trends at our Toquepala and Cuajone mines.

In 2026, we expect to produce 29,000 tons of molybdenum, which is 12% above our initial plan. Silver represented 7% of the company sales in the third quarter of this year.

Silver prices averaged $62.80 per ounce in the quarter, compared to $39.56 per ounce in the third quarter of 2025. This represents an increase of 59%.

Silver is currently our second most important byproduct. Mined silver production decreased 2% in the third quarter of this year, versus the same period in 2025, driven primarily by a drop in production at our open-pit operations.

These results were partially offset by an increase in production at our IMMSA mines. Refined silver production decreased 6% quarter over quarter, fueled mainly by a drop in production at the La Caridad and Ilo refineries.

For 2026, we expect to comply with our plan to produce 24 million ounces of silver. For zinc, it represented 4% of our sales value in the third quarter of 2026, with an average price of $1.74 per pound in the quarter, which represents a 38% increase compared to the third quarter of last year.

Zinc is currently our third byproduct. Zinc mined production decreased 8% quarter on quarter, and totaled 41,880 tons.

This was mainly due to a drop in production at Buenavista, Charcas, and San Martin operations. These results were partially offset by higher production at our Santa Bárbara operations.

Refined zinc production decreased 6% in the third quarter vis-à-vis the third quarter of 2025. For this year, we expect to produce 163,400 tons of zinc, 1% below our initial plan.

Looking into our financial results, for the third quarter of 2026, sales were $4.7 billion, which is $1.3 billion above the sales print in the third quarter of 2025, or a 39% increase. Copper sales increased 41% while volume decreased 0.4% in a scenario of better price.

As we mentioned, the London Metal Exchange price increased 44% and the COMEX 34%. Regarding our main byproducts, sales of molybdenum were up 31% due to better prices, which were partially offset by a decrease in volume.

For zinc sales, they also increased by 36%, fueled by better prices and better volume. Lastly, silver sales also rose this quarter, riding the wave of better prices, whose impact was partially offset by a decrease in volume.

Our total operating costs and expenses increased by $233 million, or 17%, when compared to the figure in the third quarter of last year. The main cost increments were in diesel and fuel, workers' participation, inventory consumption, depreciation, power, and labor costs.

These cost increments were partially offset by translation differences of $22 million, such an exchange rate variance that favored our costs in local currencies. Our third quarter adjusted EBITDA hit a record high of $3 billion, which represented an increase of 54% with regard to the $2 billion registered in the third quarter of 2025.

The adjusted EBITDA margin in the third quarter of this year stood at 65%, versus 59% in the same period of 2025. Adjusted EBITDA for the nine months of this year was $1.8 billion, which is 56% higher than the print for last year.

The adjusted EBITDA margin in the nine months of 2026 stood at 65%, versus 58% in the same period of last year. Cash costs: operating cash cost per pound of copper, net of byproduct revenue credits, was 9 cents in the third quarter of 2026, which represented a decrease of 77% compared to the 52 cents reported in the third quarter of 2025.

This result was mainly driven by an increase in byproduct revenue credits of 31%, which rose on the back of better prices. Operating cash cost per pound of copper before byproduct credits was $2.46 per pound this past quarter.

This is 23 cents higher than the value for the third quarter of 2025. This 10% increase in operating cash cost before credits was the result of an increase in cost per pound from production costs, and for administrative expenses, which was partially offset by an increase in the premium and treatment and refining benefits that the company has been collecting.

Regarding byproducts, we had a total credit of $1.2 billion, or $2.36 per pound, in the third quarter of 2026. These figures represent a 31% increase compared to a credit of $900 million, or $1.81 per pound, in the third quarter of 2025.

Total credits increased for molybdenum, zinc, silver, and sulfuric acid. For the nine months of 2026, the operating cash cost per pound, net of byproduct credits, was 1 cent.

This represents a decrease of 98% compared to the 61 cents reported for the nine months of 2025. For this year, cash cost decrease was driven by an increase in byproduct credits of 54%.

This is for the year-to-date figure for cash costs. The third quarter of 2026 net income hit a record high of $1.8 billion, which is up 63% versus the $1.1 billion registered for the third quarter of 2025.

This was mainly due to higher net sales. Net income margin in the third quarter this year stood at 38%, versus 33% for the same period of 2025.

On a year-to-date basis, net income was 67% higher than in 2025 due to growth in net sales. Net income margin for the nine months stood at 38%, versus 32% in 2025.

Cash flow from operating activities in the third quarter of this year was $2.2 billion, 43% above the figure in the third quarter of 2025. This improvement was mainly attributable to strong cash generation at our operations, which was driven by higher sales.

For the nine months of this year, cash flow from operating activities stood at $5.9 billion, which represented an increase of 81% over the $3.3 billion posted in the nine months of 2025. Capital investments: our current capital investment program for this decade exceeds $21 billion, and includes investments in projects in Peru and Mexico.

Given that there is a description of our main capital projects in Southern Copper's press release, I'm going to focus on updating new developments for each. For the Peruvian projects, I will begin with Tía María.

Tía María is expected to produce 120,000 tons of SX-EW copper cathodes per annum in the early years of operations. Operations are scheduled to begin in the first half of 2028.

As of September 30th of this year, the company has invested $884 million in project execution, and committed $1.1 billion to cover diverse activities, acquisitions, and related contracts. Large-scale earthworks have concluded, and 18.9 million metric tons of material have been transferred to the Tapada stripping deposits.

Most work orders for the project primary equipment have been issued. Purchase orders for the leaching process have been placed to secure the main equipment, which will be outfitted with cutting-edge technology, as well as secondary equipment and materials.

On the energy supply front, work is advancing at the main electrical substations, and the 220-kilovolt transmission line is in its final stage of construction. In parallel, large-scale earthworks to develop dry and wet areas have been completed.

At the project main installations, civil work is advancing alongside efforts to assemble metal structures and the main components of the crushing equipment for the primary, secondary, and tertiary crushing circuits in the dry area. In the wet area, work to build the solvent extraction and electrowinning facilities, among others, is progressing.

As of September of this year, the Tía María project was 50% complete. Additionally, 6,817 new jobs have been created; 1,121 of them were filled by local applicants.

To the extent possible, the company intends to cover the estimated 7,000 jobs that will be created during Tía María's construction phase with workers from the Islay province. For Los Chancas, this is a project also in Peru, at the Apurímac region, that is expected to produce 130,000 tons of copper and 7,500 tons of molybdenum annually.

The capital investment is estimated at $2.6 billion, and we expect to be in operations by 2031. For the project update, social and environmental management programs are currently being implemented in the communities within the project's direct area of influence, in accordance with the framework agreement signed for the development of the Tiaparo peasant community under the Los Chancas mining project.

In addition, measures are being taken to regain control of the project area, which has been threatened by illegal miners. Regaining control is essential if we are to continue developing our Los Chancas project.

For the Michiquillay project in Cajamarca, Peru, this is a project in which we expect to produce 225,000 tons of copper per year, with byproducts of molybdenum, gold, and silver. The mine life is estimated at 25 years, and we estimate to invest approximately $2.5 billion to begin production, expected by 2032.

The deposit mineral resource estimation and classification report has been developed with geological information obtained from drilling programs and geological models. These reports and studies are compliant with SEC's SK 1300 mining disclosure standards.

A conceptual study is underway to determine where a conventional and/or filtered tailings storage facility should be located. Hydrological, hydrogeological, and geotechnical studies are also being conducted.

We are adding an expansion of the Cuajone operation to our pipeline of projects in Peru. This is to maintain or potentially increase production levels for the Cuajone operation.

For this, the company is evaluating an expansion from the current milling capacity of 90,000 tons per day to 120,000 tons per day. This is a 33% increase in milling capacity.

The expansion will require additional mining equipment and a new production line at the Cuajone concentrator. Current estimates point to a capital cost of $680 million to produce an average of 55,000 tons of copper and 1,400 tons of molybdenum per year.

As part of a thoughtful review on the matter, studies are underway to determine the viability of expanding the Cuajone operation to 150,000 tons of milling capacity per day. Focusing in our Mexican projects, Southern Copper has several projects in its Mexican pipeline that may boost organic growth if they are found to be of value for both stakeholders and the communities in which we operate.

These projects are Angangueo, Chalchihuites, and the Empalme smelter. They are expected to bolster our position as a fully integrated copper producer.

We're engaged in talks with the current administration to continue rolling out SCC's Mexican investments for about $10.2 billion. El Pilar, which is located in the Sonora state of Mexico, is a project that it's about 45 kilometers from the Cananea town and the Buenavista mine.

Its copper oxide mineralization contains estimated proven and probable reserves of 317 million tons of ore, with an average copper grade of 0.25%, and a life of mine of 18 years. El Pilar will operate as an open-pit mine, with annual production of 36,000 tons of copper cathodes, utilizing cost-efficient and environmentally friendly SX-EW, or solvent extraction and electrowinning, technology.

With an investment of $551 million, this project will employ a direct workforce of 450 people during the construction phase, and 300 during operational phase. El Pilar is a new copper project that has obtained the necessary environmental permits.

Early site preparation began in September of this year, to develop energy lines and build on-site construction offices. Contracts and studies related to the substation and transmission line are in the works.

Basic engineering contracts for the access road, rail water spool, substations, and power lines have been signed. The EPCm bidding process for the SX-EW plant is underway, and expected to culminate before year-end.

Project construction will commence in the first quarter of 2027, and production is expected to begin in the second half of 2029. Focusing on environmental, social, and corporate governance, or ESG practices, we are glad to report that our sustainability ratings continue to improve.

In its Corporate Sustainability Assessment 2026, S&P Global increased Southern Copper's rating by 2 points over last year's print. The company ranks among the top three performers in the mining sector, with a rating that doubles that of the industry standard.

Some of SCC's individual ratings were top of class for the sector; that is the case for transparency of reporting, materiality, risk management, business ethics, energy, biodiversity, and community relations. On top of what I just mentioned, four operations in Sonora—these are the lime plant, the La Caridad mine, the Minera México copper smelter and refinery, these four operations—were awarded with the Silver Helmet by the Mexican Mining Chamber, CAMIMEX, for their safety and accident prevention metrics.

This is the first time that four operations in Sonora this award simultaneously, which tests to our team's commitment to strengthen preventive practices, safety controls, and worker protection. In the Michiquillay operation in Peru, as part of our commitment to promote stakeholders' active participation in new project development, the Participative Environmental Committee for the Michiquillay project in Peru completed its third verification of environmental performance in 2026.

Community leaders and representatives of public and private entities sit on this committee, which has the technical capabilities to collect soil, water, and air samples, and interpret results. Their participation in project development strengthens actions and measures to prevent or manage impacts on the environment and communities.

For the past 14 years, our program Forjando Futuro, or Forging Futures, has been developing capacities and providing access to local job opportunities in the areas of influence of our operations in Peru and Mexico. Currently, 17% of the jobs on the Tía María project are held by locals, who access these opportunities through our on-site offices or in coordination with local contractors.

Under this program, Forging Futures, we have awarded 700 scholarships to young people to obtain certifications to operate heavy equipment, or engage in welding and topography. These efforts strengthen participants' technical competencies and broaden capacities to successfully enter in the job market.

Changing subjects, we are going into dividends. As it is the company policy to review our cash position, expected cash flow generation from operations, capital investment plans, and other financial needs at each board meeting to determine the appropriate quarterly dividend.

Accordingly, on October 15, Southern Copper Corporation announced a quarterly cash dividend of $1.30 per share of common stock, and a stock dividend of 0.0126 shares of common stock per share. This is payable on November 19 of this year to shareholders of record at the close of business on November 3rd, 2026.

Ladies and gentlemen, with these comments, we end our presentation today. Thank you very much for joining us, and now we would like to open the forum for questions.

Good morning, everyone, and thanks, Raul. My first question is just on Tía María, maybe a little bit more color with what seems to be a little bit of a delay from the fourth quarter of 2027 to the first quarter of—the first half of 2028.

If you can provide a little bit more color as to what prompted that decision, and if you could expect maybe a potential increase in CapEx? I noticed that it's still 1.8, but typically when there are delays, more often than not, it comes with a higher CapEx associated with that.

I wanted to get your color. That was my first question.

I'll ask the one next.

Okay. On the expected start of Tía María, we have found that it will take a little bit longer for us to assemble doing the mechanical assembly of all the equipment, as well as some works related to engineering on the project.

I think that that's why we, when we review the expected timeline, we pass it from the fourth quarter of this year to the first half of 2027—2028. On potential CapEx increase, we are not reporting on any changes on that.

We will mention this issue and address it in the call that we have in January, not only for Tía María, but in general for our production forecast, as well as our CapEx for this next year and on.

Thank you. If I may ask, what is your production, maybe not guidance, but a little bit the range?

What do you see production for copper, moly, maybe silver, next year, as well as cash costs before byproducts, maybe in the fourth quarter or 2026, the full 2026, and also the early indication for next year? Thank you, Raul.

Okay. On production for next year, are expected to be now for this year about a little bit less than 920,000 tons.

For next year, we'll provide an update. We're doing currently a thoughtful review in all our mining plans, and on the base of that, we will issue a much more firmer forecast at the beginning of 2027 in our January call.

For cash cost, well, as this is one of the hardest things to forecast, because you not only have whatever happens with cost of production of copper and copper production, and also what goes on with our bean byproducts. Let's say that we should be about to where we are now, or a little bit better, cash-cost-wise, for next year.

Okay. Slightly flat to or, I don't know, slightly stable, plus maybe slightly better next year.

The fourth quarter, do you think will remain also relatively stable versus what you reported in the third quarter 2026?"

I'm so sorry, I couldn't get what you said, Carlos.

On the fourth quarter, sorry, on on the fourth quarter 2026 cost before byproducts, would you expect them to remain also stable versus the third quarter?

We don't see any that may distort the cost or increase them. We see some possibilities of a cash cost reduction before any credits, but that's contingent of getting our production goals, which we're focusing on that, as well as byproducts credits that as you well know, are strongly influenced by prices in the four byproducts.

Thank you, Raúl.

You're welcome.

Hi, good morning. Thank you for taking my questions.

Two quick questions on my side. First, on capital allocation, cash obviously continues to build at a very fast pace, and even with CapEx expected to reach $2.5 billion in 2027, we would expect cash accumulation to continue at this strong pace, right?

I'm just wondering how is management thinking about the potential for increased shareholders' distributions from here? That's my first question.

Then my second question, a broader question on CapEx. We've seen several major projects revisit their CapEx estimates higher in the recent months amid broader inflationary pressures.

I know roughly half of Tía María's CapEx has already been deployed, but how do you see risks of revising the remaining CapEx higher? How should we think about potential inflationary pressures across your other growth projects?

Those are my two questions. Thank you.

On potential inflationary impact, we're currently reviewing our CapEx. We will be giving some color on this when we report the end of the year, as well as the look forward for 2027.

I'm so sorry, there is one one microphone that is open. Regarding inflation, we're looking into our projects current budget, see if they have to accommodate any variances for next year.

Far, we have not reported anything specific on this. Regarding dividends, as it is always contingent of a board decision.

The company has been giving dividends in cash as well as in stock that was acquired at $26 per share that are being handed back to our shareholders, considering the current position of the company, which I think it's very favorable in that regard.

That's clear. Thank you.

You're welcome.

Hi, everyone. Good morning.

Two quick questions here. The first one, Cuajone, I just wanted to understand when the guys expect to submit the project to board approval, and when would you see effectively incremental copper production coming online?

Also, what needs to happen for you guys to take decisions on the expansion to further 150,000 tons per day capacity? That's the first one.

Just on cash costs, specifically, the primary product side, it seems like energy costs in Mexico have been rising, which is natural gas. I just want to understand if the cost pressure that is in this quarter is structural, indeed, and if there are any leverage to potentially offset those impacts?

Right. Thank you.

Okay. On the Cuajone expansion, we have to finish the technical studies, very well advanced.

That's why the board has authorized us to mention it in our press release as something that it's very likely to go on, even though we don't have the final go for the project. We are very close to getting it, I would say that it's going to be a very very interesting investment for us.

In the case of cash cost, we're seeing different impacts on materials. In the case of gas, we're importing it for the Mexican operations from the Texas basin, the Permian Basin.

That is, being a byproduct of oil, gas has had some very competitive costs that has helped us in our costs for gas consumption at Mexican operations. We don't see a problem with that.

We think that the market will have a reasonable supply at a good cost for the company for the Mexican operations. Besides this, on the byproducts, being us sulfuric acid producers, we have been consuming our own sulfuric acid at very competitive costs, which is the one that we have for production.

A portion of our production, particularly at the Peruvian operations, it's been sold at the South American market, which has a very competitive price for the spot price as well as for contracts on this. I've already covered a little bit our view on the cash cost, and hopefully, we will have it maintaining its current level or improving slightly, I would say, regarding to where we are.

All right. Thank you.

Just one more on Tía María, please. Just confirming, the company does not expect CapEx to increase.

It's probable the $1.8 billion is remaining, right, despite of this, let's say, one to two-quarter delay? Just in Tía María, again, the deceleration to physical progress that we saw this quarter, you mentioned it was driven by longer times in assembling the different equipment.

That was a one-off, and then physical progress should then accelerate in the next quarters? Does it make sense?

Thank you.

On CapEx, we're currently reviewing all of them, I am not making a specific comment on that. I couldn't get the second point of your concern, Emerson.

All right.

Great. Thank you.

Just a couple of questions. On the Cuajone expansion, if you go large to 150,000 tons per day, should we assume the CapEx is broadly the $1.4 billion, twice the 680, if you put one line in?

That's first question.

On this, we're not making any comments. When we finish the studies that are being conducted for 150,000 tons of daily milling capacity, we will report to the market on the estimated CapEx that it has.

Okay. It would be a decision early next year is what you're suggesting, either to 120 or 150?

Yes. The company, currently, we see a much more firmer possibility for going into 120,000 tons.

However, we are looking into 150,000 tons of milling capacity since we had some of the estimated restrictions that it has been removed, and that is something that allows us to consider this as a possibility. Once we realize that this is feasible, we decided to go ahead with the technical studies for 150,000 to see if we can confirm this as an option, and if so, we will present it to the board for an approval.

For now, the most likely scenario

is 120,000. No, that's very helpful.

With Los Chancas, when do you hope to get the illegal miners off? Literally, if you're successful getting them off, what's the path way to FID there?

We have a little bit north of 200 illegal miners. We have been in talks with the Peruvian authorities to well, solve this.

They shouldn't be in our concession. Once they are removed from the concession, we believe that we can move on with the environmental impact assessment and some other works that we have to do on a quick pace.

That's why we are expecting Los Chancas to go ahead with production by 2032. Okay.

Thank you. Sorry, 2030, let me correct what I just said, it's 2031.

31, okay.

hi. Good morning, Raul and team.

Just a quick follow-up question on Los Chancas and illegal mining. We have noticed that the Peruvian government has recently submitted a new proposal to the Congress on a new scheme to replace the original REINFO system.

How do you see the potential implications for this move to address the illegal mining problem around the Los Chancas? Are you seeing any positive signs on the ground that could help the project forward?

In this case, we have a group of people doing mining activities in a concession and a land that is company property. For this specific case, they have to go out of our concession and our property.

In the case of what you just mentioned, this new proposal given by the government, this one initiative of the Mining and Energy and Mining Minister, which we certainly think it's a step in the right direction for the country, because we cannot maintain the current situation where you have an operating certificate that is not compliant with proper production, labor, and environmental practices for artisanal mining. That has to be fixed, and we hope that the law is discussed at Congress and we get a good tool for the development of artisanal mining in Peru.

In the specific case of Los Chancas, they have to leave the premises that they are currently using, and with that, the company will go on with the project.

Understood. Thank you very much.

Also, I think we have also seen some encouraging comments from the new administration about streamlining the application for mining permits. Just wondering, from your discussions with the authorities, what kind of or which parts of the approval process could see the most meaningful improvements, and could this potentially help accelerate projects such as Michiquillay?

We think that the government has been appointed in key positions a very well-rounded and technical, capable personnel. That should improve the process of moving forward projects.

Besides this, I think that we're seeing this effort by the Ministry of Energy and Mines of eliminating or replacing by an statement some procedures. We think that this is going to be very helpful for the industry, but we need to see the specific procedures that will be changed by this effort of the authorities.

However, we believe that it's a step in the right direction for the government and the industry and the country.

Understood. Thank you very much.

You're welcome.

Hey, good morning. Thank you for the call and all that information.

On Coimolache in Peru, could you give us an update on where things stand and potential integration and expansion on that deposit and that's location in Peru?

This is an operation where we are in a joint venture with Buenaventura and some other partners. We're currently working on a sulfur deposit development for copper.

There are different options that are being reviewed, and I think that that's pretty much what I can say on that. It's something that is moving forward.

We see this as a good opportunity for the future, but there is nothing to report today.

Okay. Thank you.

You're welcome.

Thank you, and good day, Raul. A couple of questions.

The first one is regarding El Pilar. I understand that the increase in CapEx is related to additional infrastructure that you need to include in the project.

I think that you would have to build the transmission lines, just want to confirm if that is the case. The second is regarding the Cuajone expansion.

This is a project that has been in your portfolio pipeline for many, many years. Just wondering if what drove the delay, or is this simply now the best timing for doing it, just trying to understand that.

Also, what is the water situation, if you have enough water and enough anything you need for an expansion of this size, especially for the one that you are kind of considering as well of 150,000 tons per day capacity. Just if you can give us some color on that, please.

Sure. Sure, Alfonso.

In the case of El Pilar, we have an increase in CapEx. We have been looking into this project for quite a while.

We had a challenge that we want to increase recovery that we were getting from the mineral that was treated at the El Pilar investment. Besides this, the CapEx increase is also related to the inflation that we have seen in some equipment.

Keeping in mind that the cost of El Pilar, the prior one, was kind of a historic budget that was prepared a few years back, a little bit more than five years away. In the case of the Cuajone expansion, well, we have been looking into different possibilities for getting the water for the project.

That has taken a little bit longer than what we believed a while ago. In general, we think that we have identified good sources of water for the Cuajone expansion.

For 120,000 tons, we believe that we have all the water requirements that we have. We need to do some other works on the technical side, and some other challenges that the project has, and that's why we have taken a while to look into this matter and making a proper decision.

Now we are reporting that this is a good possibility for us, and we will be showing the advancement that we have on this matter as we move on into, well, the end of this year and 2027.

Just to confirm, you have to build the transmission lines for El Pilar, or is that Comisión Federal is going to build it?

Sorry, I couldn't get what you just said, Alfonso.

Sure. For El Pilar, are you including the transmission lines, which is part of it, for the project, or no?

I don't have an specific answer for that question, Alfonso.

Thank you.

Hey, guys. How are you doing?

I just wanted to clarify the questions on the cost. I know we went over it a bit.

It sounds like you're guiding or pointing to flat sequential costs before byproducts for Q4. Then for 2027, when you said flat to lower, is that from the Q3 level, like the Q3 run rate, or are you talking about full year 2026?

No, it's sequential for where we are. Just keep in mind that cash cost is very difficult to predict.

We are at a very competitive cash cost of 9 cents per pound this past quarter. Prices of our byproducts hold, and I think that copper production will improve a little bit on the fourth quarter vis-à-vis last year.

We should be reporting a cash cost before byproduct credits in line or slightly better than what we did last quarter. That's our expectation at this point.

For 2027, we will report in detail when we address the January call with our 2026 results, as well as the outlook for 2027 and the year. Thank you,

Matt. That's helpful.

Then I know this is also really tough to predict, like costs, but just with everybody talking about a super El Niño and potential big impacts to mining, maybe in Peru, how are you all preparing for it, if you are at all? What kind of things can you do in advance to get ready for I think it's supposed to hit in early 2027?

Depending on where you are in the country, El Niño has different impacts. In the case of where we are, we are at the southern part of Peru, and the usual trend of El Niño is that you have excess rain at the northern center to the northern part of the country, and a drought on the southern part.

We have been evaluating our water sources. We have been taking some actions to be sure that we have all the water that we need for next year.

The balance has shown us that we have a reasonable supply even to address this drought that we're expecting at the southern part of Peru.

That's helpful. Appreciate the color.

You're welcome.

Hey, Raul. Thanks for taking my questions.

First, I just wanted to ask on project timelines. You mentioned 2031 for Los Chancas, but obviously, that's dependent on getting the illegal miners out.

Is there sort of a timeline, when do you need to sort of remove the illegal workers to hit that 2031 startup? Along with that, I think you said Michiquillay was coming in 2032, and these are sort of two relatively big projects.

I'm just trying to understand your level of comfort around hitting these timelines of 2031 and 2032 startup for both of these projects. Then my second question relates to I guess the negative TC/RCs that we're seeing in China.

I know historically you've said there might be some investment in your own smelting and refining capacity. I guess I just want to understand sort of how the negative TC/RCs in China are impacting you, your potential capital investment going forward, and are you sending more concentrate to China to take advantage of these TC/RCs?

Any sort of color you could mention that would be great.

Okay. On on the, well, on on the timeline for Los Chancas and removing the illegal miners, let me I I don't want to put a specific deadline for removing them, but obviously has to be in a relatively short term, and because otherwise, we cannot move on with all the other parts of the the project that we need to to comply with in order to get the environmental impact assessment finished, get the permit for construction, and and so on.

We have we have we consider that we could begin the construction in 2028, and in the second half of 2028, and with that, we we should be finishing the project by 2031, I would say, 31, as I said. In the case of Michiquillay, we don't have illegal mining activities, and we do have a a social contract signed, or social social agreement signed with the two communities that are in the Michiquillay that are directly directed related to the Michiquillay project.

On that, I don't think that we have we have a matter. The the work with these two communities is moving forward on on on on the right path, and we are we are certainly very positive and optimistic on on Michiquillay.

The timeline goes to 2032 because it's we are we're at a more more of a beginning of all the process for for getting the project complete and and all the permitting, etc. Focusing on negative TC/RCs, well, obviously, it's hard to to consider building a new smelter with this environment where you get a a a premium on top of your concentrate copper price.

That's that's what it's what it's happening here with the negative TC/RCs. The upside is that sulfuric acid prices are are are at a good level, and that is something that helps us helps us in our revenues because we are long in sulfuric acid, particularly at the Peruvian operations.

Obviously, the the a possible new smelter for for both Peru or Mexico is something that is contingent of having the proper market conditions, and we're we are we're considering the current circumstances as as one of the points to to to have that have to be addressed, and and probably change in in direction before we go ahead with the construction of a new smelter in any of these two countries. However, this is something that that goes to our DNA of being an integrated copper producer.

We think that the fact that we produce refined copper, and this is something that will increase when we put Tía María and El Pilar. Both both projects will produce refined copper with very high quality, which is certainly appreciated by the market, that provide us not only the copper price, but also with a premium on on top of the market price for for our refined copper.

This is for us being fully integrated and producing more refined material is one of the goals that we are looking into for the long run of the corporation.

Great. Thanks, Raul.

You're welcome.

Thank you very much, Victor. With this, we conclude our conference call for Southern Copper's third quarter results.

We certainly appreciate your participation, and hope to have you back with us when we report the fourth quarter of this year and the full 2026 results. Thank you very much for being with us today, and have a nice day.