Barrick Mining Corporation (B) Q1 2021 Earnings Report, Transcript and Summary

Ladies and gentlemen, thank you for standing by. This is the conference operator. Welcome to the Barrick 2021 First Quarter Results Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded and a replay will be available on Barrick's website later today, May 5, 2021. I would now like to turn you over to Mark Bristow, Chief Executive Officer. Please go ahead, sir.

Thank you very much, and good morning and good afternoon, ladies and gentlemen, and welcome to Barrick's quarter 1 results presentation. What a wild past 12 months it has been. You all recall it was Q1 2020 when we held our first all-virtual results presentation exactly a year ago. When we announced a merger between Barrick and Randgold back in September 2018, we said its rationale was to combine the industry's best assets with its best managers to bold its most valued gold business. It was and remains our long-term strategy. But in a relatively short period of time, as I'll show you today again, we have also achieved a long list of established accomplishments. Most recently, in a quarter still heavily impacted by COVID-19 and we met our production guidance, maintained strong free cash flow and increased our net cash by $500 million, in spite of an advanced tax payment of $72 million to the state of Nevada. The quarterly dividend has been increased threefold since the merger announcement, and this year will be topped by a $750 million return of capital distribution, more than doubling the payout for the year on a per share basis. Exploration, refocused and stepped up since the merger, is pumping exciting prospects into our pipeline from multiple targets across the group. And major growth projects such as the Pueblo Viejo expansion and the third shaft at Turquoise Ridge are making good progress. And at Porgera, we are on track to resume operations later this year following our binding framework agreement with the government of Papua New Guinea. I refer you to this cautionary statement, which is also available on our website, should anyone wish to study it in more detail. Our businesses have, over a long period of time, earned their social license to operate, and this has served us well at a time when ESG has become a key investment criteria. In our sustainability report for 2019, we published the industry's first ESG scorecard, rating ourselves against our peers and the requirements of the GRI sustainability reporting standards. The sustainability report for 2020 released a few weeks ago and which now also reflects the checklist of the Sustainability Accounting Standards Board, shows that we have made progress against almost all key ESG metrics. We have also advanced our admission reduction target from 10% to 30% by 2030, with the ultimate aim of achieving net 0 by 2050. The principles behind ESG have long been practiced by Barrick's 2 legacy companies and are deeply embedded in our every facet of our business. We believe that a good company should also be a good neighbor, which is why we invest heavily in community development projects, guided by the fully functional community development committees we now have at all our mines. We also prioritize local employment. Last year, 97% of our workforce were host country nationals, and we give a preference to local contractors and suppliers, with whom we spent more than $4 billion in 2020. We take great care to manage and minimize our environmental impacts, and all our operational sites have now been certified to the ISO 14001 global best practice standard. Still on the social and governance front, we are addressing the checkered human rights history of our Tanzanian mines through audits and training conducted by external experts. These are the highlights from the 2020 sustainability report. It's a core Barrick philosophy that the benefits created by our operations should be shared equitably with all stakeholders, particularly our host countries and communities who are the owners of the resources we mine. As we have already seen in Tanzania and Papua New Guinea, governments of developing countries are demanding a bigger slice of ownership. Barrick's answer to this is to work to increase the size of the pie, benefiting all. Our sharp focus on safety continued to drive performance improvement and our total recordable injury rate was again reduced. Latin America has done particularly well on the safety front, but North America and Africa and the Middle East still have some work to do. A number of our mines have already received their ISO 45001 certification, and the rest are on track to achieve this compliance by the end of this year. We're also not easing up on our COVID controls, and we've already started vaccinating the workforces at Nevada Gold Mines, Pueblo Viejo and Jabal Sayid. A group-wide vaccination plan is currently in the works. There were 0 highly -- high severity environmental incidents in the group last year or during quarter 1 of this year. We are particularly proud of our water recycling and reuse programs, which in the first quarter of 2021 achieved an 84% efficiency rate, ahead of our 80% target. Carbon emissions continued to decrease in line with plan, and we've been extending our environmental reach into the wilderness areas of our African host countries, with some important natural assets are under threat. In terms of a recent agreement with the government of Mali, we are assisting with the rehabilitation of the neglected Fina Reserve, a Unesco biosphere site. In the Democratic Republic of Congo, we support the Garamba National Park, home to the country's largest elephant population as well as the critically endangered Kordofan giraffe. As part of our support, we sponsor an elephant tracking program and since 20 -- September 2019, no incidence of elephant poaching have been recorded, which is a significant achievement in this part of the world. These are the highlights of the quarter. Our Tier 1 assets again produced solid performances with leading margins, getting us off to a strong start to the year and putting us on track to achieve our annual production target. A particularly notable feature was the 31% increase in copper revenues due to higher copper prices with continued strict control -- cost control. As guided, the quarter 1 results were softer for a range of operational reasons, but we are forecasting a much stronger second half, driven by mine sequencing and planned maintenance at Nevada Gold Mines; the commissioning of a new leach pad valley at Veladero; the ramp-up of underground operations at Bulyanhulu; and higher grades forecast for Lumwana. The strong free cash flow and the increase in net cash are the highlights of the quarter. The sustainable quarterly dividend, coupled with the $750 million return of capital, represent an industry-leading return to our shareholders. An average lower gold price, which was $100 per ounce less than in the previous quarter did, however, impact revenue, but the copper operations benefited from a much higher copper price. Over now to operations, and we begin with the North American region, which is off to a good start to the year and on track to meet its annual guidance of 2.3 million to 2.45 million ounces of gold on an attributable basis. Nevada is Barrick's value foundation with 3 of our Tier One mines, leading margins, a strong operating cash flow and a solid net cash position. The joint venture has a good grip on its geological inventory with the brownfields and greenfields exploration programs up and running and already paying dividends. Nevada is probably the world's most prospective gold district and major opportunities are taking shape around our core sites at Carlin, Cortez and Turquoise Ridge. The potential to grow resources and add value from this asset base is very significant. Production at our North American flagship Carlin mine was down because higher carbonaceous ore had to be blended with lower grade stockpile feed, which affected roaster feed grade. Costs were, nevertheless, well contained. Both Carlin roasters will be shut down for their annual maintenance during the second quarter, that's this quarter. And that's partially why we are forecasting a better second half performance. At Carlin, we are looking to extend the known ore body deposits. Work on the North Carlin trend is targeting higher-value breccia bodies open at depth with a view to enhancing the life of mine as well as making new discoveries. Leeville continues to yield robust high-grade results, and recently identified controls are opening up new peripheral targets. Two emerging high-grade zones have been identified within a broad mineralized horizon. Evaluation of the Northern Leeville area's full potential has been accelerated and resource conversion is in progress. We expect a maiden resource for the year-end and are confident that it will continue to grow. We now move to Cortez, where production was impacted by resequencing as a result of a previously reported geotechnical event, which delayed stacking at the heap leach pad and affected the feed blend to the oxide mill. The mine expects a stronger second half of the year, thanks to a higher contribution of fresh ore from pipeline as mining there ramps up. At Robertson in the Cortez District, we are also converting improved geological knowledge into growth opportunities. Step out drilling 300 meters beyond the existing resource blocks suggest there's considerable near-surface upside that could lead to additional discoveries and validates my personal belief of the potential of this area. We're also looking at Pipeline, an old Tier One asset immediately adjacent to Robertson which could provide a significant addition to Cortez's life of mine. And at Goldrush, the exploration declines have now intersected the ore body with positive results. Development is accessing all for the initial bulk metallurgical campaigns and heading north towards the first vent shaft position. We are considering whether to access Fourmile from surface or by -- sorry, we're considering whether to assess Fourmile from surface or by underground from Goldrush, which is our preferred option. Fourmile, based on what we know, provides real potential to add to Goldrush's value in many ways. Not least of all, Fourmile is a higher grade resource and with its inclusion, it centers the main access development, allowing better utilization of the invested capital. At Turquoise Ridge, we had a better quarter with steady production and slightly better grades from the Twin Creeks open pit. Total cash costs were well within guidance. Construction of the third shaft debottlenecks the hoisting and ventilation constraints, which will allow for higher underground production. And it remains within budget. That's the Turquoise, the #3 shaft. It remains within budget and on schedule for commissioning in late 2022. We have at Turquoise Ridge made considerable geological progress. Improved understanding of the controls of mineralization has provided a solid foundation for mine design and planning, and has indicated a significant potential for a new high-grade underground operation. If, as anticipated, Turquoise Ridge and Twin Creeks are proved to be geologically connected, it could add significant high-quality ounces to this complex. And still in Nevada, production at Phoenix was consistent with the previous quarter, and costs were significantly lower due to increased copper by-product credits. And I would just point out that it's only at Phoenix where we allocate credits for the copper back to the all-in sustaining cost per ounce of gold. With total cash costs of $79 per ounce for the quarter, Long Canyon continued to boast some of the best margins in the industry. Long Canyon's mine life extension project is being reviewed, as we shared with you last quarter. And we are planning now, having reviewed it, to restart the permitting process for Phase 2. Further north, in Canada, Hemlo had a challenging quarter as it continues to transition to an underground-only operation with the closure of the open pit in late 2020. Strong production is expected in the second half of the year, and the mine remains on track to meet its annual guidance. And meanwhile, we continue to position Hemlo as a potential Tier Two asset. Mining from its new portal is expected to begin in the latter half of 2021. And this will provide a third mining front and increasing flexibility to the mine. At Hemlo, the geologists have done a great job, and the identification of significant new extensions outside the mine plan is expected to speed up its journey to Tier Two status. So back to the United States, where our Donlin joint venture with NovaGold in Alaska has commenced its 2021 drill program of 20,000 meters. This program is aimed at testing the updated geological model and ore controls and to obtain additional geotechnical and geometallurgical data. This will support the completion of the updated geological resource and genetic models, after which we will decide on the next steps in this project's progression. And so now we move to -- move south to our Latin American and Asia Pacific region, where we continued to intensify our focus on generative exploration and new business. The region also houses 2 of our key projects: Pueblo Viejo's plant and tailings expansion and Veladero's transition to a new heap leach facility. We are guiding annual attributable production of 600,000 to 660,000 ounces, and for this moment, we're also not including Porgera in this guidance. Pueblo Viejo is processing lower grades, in line with plan, as it advances development of its plant and tailings expansion project designed to extend its life to beyond 2040. Despite the lower grades, its costs for the quarter were well below the bottom end of guidance, confirming its status as a leading low-cost Tier One mine. The expansion project remains on track and on budget, and its SAG mill is now on route to the site. Bulk earthworks for the plant have been completed. And it has formally engaged with government and other stakeholders to secure land for the new tailings storage facility. The integration of the Pueblo Viejo district structural framework with improved geological knowledge has revealed the new targets. Particularly exciting is the gold mineralization at Zambrana, where ongoing work has confirmed a multi kilometer strike potential. Drilling is planned to start as soon as the permits have been approved for this project. As I pointed out last quarter, Veladero was the only Barrick mine where production was seriously impacted by the pandemic lockdown in 2020 in Argentina. But last quarter, it bounced back with a strong all-round performance well ahead of plan. The mine is currently running down the inventory from its old heap leach facility while it moves to its new Phase 6 heap leach pad. Scheduled, we are scheduling the commissioning of this Phase 6 by the end of the second quarter, that's this quarter. The connection to the Chilean power grid via Pascua-Lama was delayed also by the pandemic and remains set to be completed by the end of this year. And once we connect this and effectively connect to the Chilean target, we'll see a reduction both in Veladero's greenhouse gas emissions as well as operating costs. The pandemic also affected the district's exploration progress. But these are getting back. The programs are now getting back on track. Lama and the area between Veladero and Lama are sparsely drilled and poorly understood. So still lots to do to define the full potential of this region. Three near-mine targets are being drill tested as we speak, and a new generation of stand-alone targets are being evaluated for the next season. By way of example, at Lama East, 2 drill holes have confirmed significant extensions 300 meters beyond the current resource. Both appear to have encountered over 200 meters of mineralization starting near the surface. Assays are pending, but initial chip samples have returned very encouraging grades. And further afield, we continue exploring our holdings along the Andean trend, where we have identified 11 areas of interest. We are currently evaluating multiple new targets marked by the yellow stars on this map. You would have seen last month's announcement that the government of Papua New Guinea and Barrick New Guinea Limited have agreed on a partnership for the future ownership and operation of Porgera, which has been on care and maintenance since this time last year. The key principles of the agreement are listed here on this slide. And I believe it's a fair deal which represents a true win-win outcome for both parties. The underlying implementation agreements are in progress and the mine will be restarted when these have been finalized. If all goes well, this could be by the end of this year. So over now to Africa and the Middle East, home to 2 Tier 1 mines and 2 copper mines. Another strong quarter means the region is well positioned to achieve its annual attributable guidance of between 1.5 million and 1.6 million ounces of gold and 320 million pounds to 360 million pounds of copper. The Africa and Middle East region boasts enormous prospectivity, supporting the potential to further add to the already robust 10-year plans. And Loulo-Gounkoto this quarter delivered another stellar performance, beating its budget and boosting production by 25% quarter-on-quarter on the back of higher grades and increased throughput. The complex continues to invest in its future, and development of its third underground mine at Gounkoto is well underway. Studies are also continuing to advance a potential fourth underground mine at Loulo 3 and a pit expansion at Yalea South. And meanwhile, the Yalea underground system continues to expand, as shown on this slide, through the extension of its high-grade zone to the south. The Loulo District has been one of the world's most prolific producers of world-class gold discoveries, and we are confident that it still has the potential for more. It straddles Mali's border with Senegal, where we are finding interesting and extended new styles of mineralization, particularly in Kabewest and Soya in the Bambadji permit. And on the Mali side, there is a potential new discovery at the Yalea Ridge, while drilling beneath the Loulo 1 ore body has returned exciting intercepts. In addition, there are at least 3 major structures immediately south of Gounkoto, where extensive anomalism points to the potential for further opportunities. As you know, last quarter, we repositioned Tongon to extend its life by reducing its throughput, and the quarter 1 results reflect that transition. We're also looking at supporting the mine life extension through brownfields exploration on satellite target as this map shows the exploration team has identified a number of these targets, each with the potential of increasing Tongon's life of mine. And what's important is quite a few of these priority targets are within 10 kilometers of the Tongan mill. Now across to East Africa, where Kibali's Q1 production remained in line with plan as it keeps on track to achieve its annual guidance. Recently, a new government has taken office in the DRC. And we spent some time with this -- the new government appointees, the new cabinet appointees, just 10 days ago and engaging with them. And we have always had, as you know, a strong relationship with the Congolese government. And I think now after 7 months of really no real cabinet to speak of, we now have a fully appointed and responsible and accountable cabinet, supported by both the parliamentary and Senate majorities. And we are confident that we will be able to address some of the outstanding issues that have been on the table for some time now, including the movement -- the free movement of cash from the country. At Kibali, our reserve replacement program targeting a third successive year of growth continues with quite some success. Drilling on the world-class KCD orebody has confirmed alteration and mineralization over 500 meters down plunge of previous drilling and the existing resource limits on all loads. And KCD is all about these cigars that plunge down. And they have a high level -- a high number of ounces per vertical meter because of their grade. This work supports the extension of the KCD system and bodes very well for our ability to continue replacing depletion at Kibali for the foreseeable future. Likewise, exploration along the KZ trend has delivered a number of open pits, which will increase flexibility at the mainly underground Kibali by balancing the ore feed with more open pittable material. The exploration pipeline at Kibali continues to grow. And it is currently led by the Kalimva target. Moving further east now to Tanzania and North Mara, where North Mara had a good quarter on the back of improved underground productivity and higher grades. We still have some work to do on the plant upgrade, and our exploration team is looking at building up the life of mine. Continued work on the Gokona system is indicating potential lateral and down dip extensions to the ore bodies which could provide substantial resource growth to extend the life of the North Mara mine. And the ramp-up of the underground mining and processing operations at Bulyanhulu is making very good progress towards achieving steady state production. The drill program in the high-grade Deep West zone continues to produce positive results. So a little bit about our copper production. Copper has been one of the top-performing commodities over the past 12 months, with the metal recently breaching $10,000 per tonne for the first time in over 10 years. The fundamentals for copper remain strong. And as you know, I've spoken about copper for the last 2 years. And we see our own copper portfolio as a source of differentiation to our gold industry peers, providing shareholders with meaningful exposure from assets that are in production today. Based on the current spot pricing, copper is expected to represent at least 20% of our gold equivalent ounces sold from 2021 to 2025, up from the 16% contribution in 2020 based on actual realized prices. As already referred to, Barrick's copper portfolio performed well on the back of higher copper prices. Lumwana's production was impacted by lower grades, but is expected to improve in the second half of the year. Jabal Sayid continues to deliver a consistent performance, and drilling is on track to extend its life of mine once again. And at Zaldivar, the operation is progressing its CuproChlor project and is still managing the impacts of the COVID pandemic in Chile. We've recently focused in on some of the exploration near-mine and adjacent exploration potential at Jabal Sayid, and recently, we had some wide and high-grade intercepts well outside the known ore body. And these intercepts are expected to add to, as I indicated earlier, the previously extended life online, and you can see them on these sections on the slide So as I said at the outset, Barrick's core belief is that the best assets managed by the best people will deliver the best results. Our management team's record speaks for itself. And as far as assets are concerned, Barrick's majority-owned and operated 5 -- operates 5 of the world's 10 largest gold mines, with a sixth, in the form of Turquoise Ridge, a close 11th. Our strategy is to concentrate on Tier One and Tier Two mines, and we have refined our portfolio accordingly through the disposal of noncore assets in a process which has already realized $1.5 billion and is still continuing, most recently through the sale of Lagunas Norte in Peru and some smaller legacy sites. Each of our core mines has a high confidence 10-year plan in place. And I would point out those are plans, not forecasts. And Nevada gold mines, in fact, is looking beyond that. The rise in the gold price has prompted a resurgence, in my opinion, of the short-termism which plagues and has plagued the market, with investors going for short-term gains rather than sustainable growth. However, at Barrick, it's all about building a business for owners. And our focus is firmly on the future and on the creation and delivery of long-term value to all our shareholders as well as all our other stakeholders. Our foundational objective is to build a business capable of delivering the industry's best returns. Over 2 years on, we've made considerable progress towards that goal. The dividend has tripled, and we are proposing to more than double that with a return of capital in 2021. Cash flows have increased to record levels and a once crippling debt burden has been reversed. These achievements are being built on a foundation of a great asset base, a fit-for-purpose structure, and a lean and agile leadership who have more than lived up to our best people mantra. We've certainly had our fair share of challenges, no doubt, and then some, but we've overcome them and we'll continue to do that, I promise you. So looking ahead, our exploration teams are on the search for new opportunities to grow our sustainable, profitable strategy. And we're more than ready to continue to exploit the openings that will be offered by the dynamics of our gold industry. So thank you, ladies and gentlemen, for your attention. We have most of our executive team on the call. And with that, we'll be happy to open up for questions.

[Operator Instructions] Our first question comes from Matthew Murphy of Barclays.

Mark and team, just a question on the Turquoise Ridge. There's a mention of fall of ground at Vista Underground. Can you remind me where is this underground? And is that anything that is of concern and ground conditions? Anything that means on the outlook?

Sorry, Matthew, what did you say about -- there's a reference to what?

A fall of ground.

So Turquoise Ridge has -- and if you remember back at some of the other legacy operations in that region -- has a history of poor ground conditions. And so we are managing some of that at the moment, particularly around the infrastructure. And again, as we change the way we mine, with more geotech input, we're comfortable that we'll move away from that. And we've been trialing automated miners in the region. We've also improved our geological knowledge. So most definitely, we're comfortable that we'll continue to improve. The other thing about Turquoise Ridge is with the completion of #3 shaft, we'll increase our hoisting capacity, which again puts -- takes some of the pressure off, improve our backfill plans and increase our number of face availability. I'll -- Greg is actually on the call, and maybe he wants to add to that. Greg?

Yes, Mark. Matthew, to answer your question directly, the Vista Underground is actually at the Twin Creeks operation. It's a small underground that was -- that's operated over there. Relatively low ounces from the bigger picture. Turquoise Ridge is our main underground operation. And the fall of ground there was -- it was significant to Vista, but it's not significant. As Mark said, it was sort of isolated geotech issue. So no, it's not a major concern going forward. But just for your information, it's over at Twin Creeks, not at Turquoise Ridge.

Our next question comes from Josh Wolfson of RBC Capital Markets.

Mark, I can't help but notice there's been a number of announcements lately across different jurisdictions on the resource nationalism side, and it's not just traditional West African challenge, I guess, for Randgold. This is something that's also present in South America and also in Nevada. I'm just wondering from your perspective, and obviously, given your decades of experience, what trends you're seeing? And if this is a greater risk today than perhaps what you've seen in the past?

Josh, of course, in times like this where there hasn't been much economic activity and the gold industry, of course, benefits from times like this because the gold price is up. We've certainly managed expectations and also supported our host countries and host states by advancing some of our taxes. I would also point out, as one of the things that I've spoken to you about and shared with the market, is it's -- the gold industry has a real responsibility as an insurance policy along with the -- and when I say gold industry, the entire industry, and of course, as miners, we benefit and participate in that. It's also important that we continue to build long-term relationships with our stakeholders. And as you -- as I've pointed out in many occasion, there's this short termism that arises all the time. So last time post the global financial crisis, there was this big demand for growth. And then when the industry went out there and bought anything that it could and resulted in value destruction, then there was an enormous amount of wringing of hands and concern, and that led to more demand from the industry as far as paying out dividends. And we've seen again this time. And so we have to put a balance on this, because when fund managers demand big payouts and dividends after a period where the industry hasn't spent a lot of money in investing in its own future and then gets disturbed by the fact that other core stakeholders like host countries, of which we are actually mining their national assets, it's an imbalance. And us in the middle as managers of these businesses and the industry have to balance that. And so as you've seen, Barrick has done that extremely well in -- following the crisis in Tanzania. We recently walked back a situation in Papua New Guinea that is now going to deliver on the split in economics, a fair split on economics. And again, we are going to have to do more of that as an industry if we want to remain relevant and be able to operate across the globe in some of these developing countries. And as you point out, Josh, it's not only developing countries and emerging markets anymore, it's everywhere.

Okay. And just one other question on Porgera, the comment about looking to revise guidance once that advances. Is it fair to say that the production impact for 2021 will be pretty limited? This is just more on the capital side in terms of the cost to restart?

Yes. That's a fair -- I mean the one thing you want to do is get this right. And it's been a tough negotiation. We need to get this right. It is a world-class asset. It's in a very challenging geographical area as well as a geopolitical area. And so and there are a lot of things that I'd like to see us improve on, one particularly, the license to operate in our community relations, our relationship with landowners. And those land owners were very key in getting this settlement over the line. So for me, we'd rather do that properly and make sure that we start a new Porgera that is capable of operating in a more harmonious way for another 20 years. So that's why we've made the decision to keep it out of our guidance.

Our next question comes from Greg Barnes of TD Securities.

Mark, I just want to -- let me touch of the tailing system at Pueblo Viejo and -- the new tailings facility and when you expect that to get permitted and actually developed.

Yes. So Greg, again, this is -- these consultations, and one of the things that we're absolutely committed to is full consultation with all interested and affected parties as well as key stakeholders. And we've been doing that for a year now. We have a significant support base from the community and of course, like anything, there are detractors in the process. And we had an altercation just last week where some -- a handful of detractors rarely prevented the right of interested and invested parties, one, to hear what we've got to say, and two, to be heard, and so we are very determined to proceed with that. We believe that it's -- this expansion is in the best interest of the communities and surrounding communities as well as the provincial and national economies. Just to give you some background, since Pueblo Viejo poured its first gold in 2013, our average share of commercial tax, corporate tax that's paid to the -- correction, corporate tax that's paid to the central government treasury is 18%. So we're a very significant part of the tax structure in Dominican Republic. And also, we are, by far, the biggest employer in that region. And again, this development is going to bring our commitment. We've already far advanced in investing in economic businesses like agri business. It's a very big cacao growing area around where we're planning to build the empowerment facility. There's a lot of benefits that can come with this. It's a natural basin which is not very prospective for agriculture or anything else. And again, that a lot of those communities would benefit from a relocation program, some additional investment in their own agricultural businesses and other industries. So this is the first of our public consultation process. And we've got time, and anyway, and these sort of things, time is not as important as the communication. And of course, we are openly inviting even the detractors to sit down and engage with us and understand what we're doing. And certainly, this project has had -- even over the recent elections, had bipartisan support. So we're very confident that we'll progress this and find an outcome that will benefit everyone and be acceptable to the majority.

And just to be clear, delay in the TSF expansion would not delay you ramping up the expansion of the process, correct?

No. We've got capacity in our current infrastructure to be able to manage this properly. We need the TSF operational during 2025. And so we are working -- and of course, we would like to have a target nearer term so that we make sure that we do arrive at the right place before it becomes critical.

I just wanted to touch on Lumwana. Given where the copper price is, the operation is generating significant free cash flow and actually challenging some of your bigger gold operations on that front. When the Randgold-Barrick merger happened, there was a lot of talk that Lumwana could be monetized. Is that something that now is off the table in your view, and you want to maintain that exposure to copper?

Yes. So Greg, one thing that you can't accuse ourself is selling anything for nothing. And we have a very good understanding of what value mineral resources come with. And Lumwana was one of those projects where certainly, we looked at it. It had a long, bad history. It was very marginal but as we looked at it, we certainly had inbound interest in acquiring it. But nobody who showed an interest came anywhere near what we believed it was worth. And then the team that we put in there, and we've reshaped it to be like our AME operations, majority, national management, very focused on profits and efficiencies. We reduced the mining costs by nearly 50%. And we made it a very profitable business. It's still a low-grade operation, but it's a big operation. And so like all low-grade operations, when you have a big run-up in the commodity price, it really does -- it's highly geared, and it really delivers significant increased cash flow. So -- and what we've demonstrated to ourselves, both with Lumwana and Jabal Sayid, is we certainly know that -- our basic approach to mining. We understand the copper business. We've proved that we can operate both high-grade complex underground mines, copper mines in the form of Jabal Sayid and also low-grade super pits like Lumwana. So -- and we see this as giving us a real in to the understanding of the Central African copper belt. And again, I think with some of the geopolitical developments in South America, you're going to see a pivot to some of the other copper-endowed geologies of the world. And we've got that interest in and knowledge in the Pakistan region, which is highly prospective, although, again, a challenging address. And now with the work that we've done in the Central copper belt, we're much more comfortable about continuing to explore and invest in that part of the world. And we also have a joint venture in the making with Ma'aden in the Arabian Shield. And we've been working with the Egyptians on their latest bid round as well. So that's also copper/gold. So we'll continue to find our own gold and gold/copper opportunities.

Our next question comes from [Jackie Kruslowski] of BMO Capital Markets.

I guess I just wanted to ask you about the presentation that you just gave. You've shown a lot of different exploration opportunities and initiatives that you're working on. Can you maybe help just to cut through a little bit, what might we expect to see in your next reserve update and your next life of mine plan or new guidance? Can you maybe give us an idea of which of your exploration opportunities might start to show up in your numbers sooner?

So Jackie, as you know, in the legacy Randgold assets, we had a system that's well established, and we replaced gold and -- that we mined on a regular basis, not always every year, but most years. And we've also got visibility for Loulo-Gounkoto and Kibali. We can show how we're going to convert ounces 2, 3 years ahead of us. What we've been working on in the greater Barrick group now is building that same sort of geological competence to be able to deliver that, and integrating and bringing back the geologists into the business of mining. And we've made a great progress in Tanzania, again, where we can see that we will continue to replace the ounces that we're mining and certainly add to that. The exciting one for me is Nevada and the Nevada gold mines and the tremendous progress that we've made with, first of all, integrating the exploration group back into partnering with the mineral resource management group. And as you would have picked up in the messaging today is that we're starting to look at 15-year horizons in Nevada gold mines. Because remember, that is a very big operation, bigger than most mining companies. And again, it consumes a lot of gold. So we need to be investing, and we need to have a longer runway in being able to manage that business successfully. And we're certainly seeing that now. And we -- the objective of showing you the future is important because again, what we -- what you can expect is the continued roll-forward of our 10-year plans. And as I've pointed out to you before, we've got a 2 or 2 about years of higher capital as we recapitalize some of our Tier One assets. And then really, we see our portfolio, as we've got it today, really grows cash flow at any gold price. Because why? Because the sustaining capital comes down to a run rate of between $1 billion and $1.2 billion. And really that allows free cash flow growth. Of course, that 10-year plan is a foundational base to our full commitment to grow further value for our owners and other stakeholders. And that will come from new exploration discoveries. Again, Nevada is very special in that the size of ore bodies that you require to deliver multimillion ounce discoveries are quite small relatively. And we still believe there's enormous potential to discover, not only to extend and replace the ounces we mine on a brownfields basis, but to make significant greenfields exploration. And that requires a real investment in R&D, the real creative side of geology and exploration. And then, of course, there's the easier projects to grow like Pueblo Viejo, where unlocking their constraint on the storage facility really unlocks an ore body that's already drilled out. And then the Veladero's is just more cash flow effectively. It's not right up in our number one part of our components, but we are very committed. And again, one small or moderate discovery within tracking distance of Veladero is very material for us. And again, I need to remind you, we've got a full processing facility which can manage just about any type of metallurgical ore that you can imagine in that part of the world, whether it's copper, copper/gold or gold, or silver, by the way. And so our geologists are -- we're challenging our geologists to get beyond just drilling on the edges of ore bodies and go out there. And so the first couple of big holes we've drilled, the one I reported to you on Lama East, is one of those results. And then we are very busy in other parts of South America as we build our portfolio and continue to look to open up new frontiers, just as we are doing in the AME region. And of course, we've got Donlin, which we spoke about, and that is a big resource, still a bit of a way to go before we are absolutely clear about the geology. And then I would like to believe that our settlement with Papua New Guinea and are proving to the market that we know how to manage even in that part of the world, because that part of the world is largely under explored, and again, offers enormous opportunity to discover Tier One assets. So that's why -- and again, I think we -- our first focus, get this business back on track, tidy up the portfolio to quality assets, deal with the legacy liabilities, which we've made progress on. We have certainly haven't completely dealt with all of them, but we are dealing with them. And then now that we've got that highly competent, very professional and agile leadership, and now it's time to focus on our future. And that's something that, as you know, I really believe, and we've now got the balance sheet, the people and the vision to be able to continue to build on our sustainably profitable strategy.

Our next question comes from Tanya Jakusconek of Scotiabank.

Just a couple of questions, if I could. I just wanted to circle back to Porgera. Just wanted to ask, how long would the ramp-up take to get to full capacity? Is 6 months an appropriate ramp up?

Tanya, yes, so 6 months to really get this to everyone onto -- on track to start the operation. And then another 6 months. In fact, in our agreement, in our framework agreement, we've got 7 months to get to sort of 80% of our targeted production. So that's the sort of guidance we've agreed to. The big -- that is not the challenge. The challenge is to get from where we are today to starting the operation. And that's our big focus now because there's quite a lot of work to do on settling a special mining license, agreeing on the full implementation agreement, and dealing with all the various agreements that one has to negotiate and settle to be able to start operations. We have -- Barrick and BNL has the operatorship, and so it's very much in our control. But this time around, we have a very equal partner in the form of the state to -- and with a real interest in this asset to be able to work with us to get this thing done. So that's our time frame. So if everything works really well, we'll be there and starting to ramp up in quarter 4. If it knocks on a bit, we might only start that ramp-up in the beginning of next year.

And just the cost that you and your partner are going to have to incur to get this mine up. Can you just give us a size of what those could be? And would this be equity accounted?

So it's -- we invest in it. We're funding it, and we recoup it as part of our -- so we recoup the capital and then after capital, we share the economics 53%, 47% in favor of the government. And that's the key, is the economic split for us, as you know. And of course, we've got the operatorship. So it's around $300 million, including the money that we've already spent to get it back up to production. Mark Hill is on the call. Mark, have I got it more or less right?

Yes, Mark, that's right. That's correct.

And when it's up back, Graham, it's going to be equity accounted?

I just explained to you that there are investors, then we get recouped the capital.

Yes, we'll move from proportional consolidation to equity accounting when the change goes through.

Okay. Great. And if I could just move to the DRC, and I'm just trying to understand and appreciate, Mark, that we've got a new, now responsible, cabinet in place. I'm just trying to understand, just your joint venture partner has given us some time lines in terms of getting cash out of the DRC. We were supposed to see this $500 million payment on a 100% basis coming through in March and then sort of installments thereafter. Can you just give us an idea of what is happening? Is that no longer the case, that we're not going to have installments anymore? And also, my understanding was that we needed to have a parliament approval if we wanted to put a permanent mechanism in place to get the money out seamlessly. Can you just clarify some of this for me?

So Tanya, let me just explain to you. So the -- first of all, DRC doesn't have exchange control approval. So -- and it's never had it. There's a glitch in the 2018 mining code, which, by the way, we all operate under protest. And on top of that, our joint venture partner is correct because we give them that guidance. But the expectation of moving from this paralyzed government situation which we've endured for 8 months now, a little bit over 8 months, has been -- we have been expecting it to happen and it hasn't happened as quickly as we expected. And even the appointment of the new cabinet, which as I indicated is now supported by a majority in Parliament and in the Senate, that cabinet was only sworn in last Thursday evening. So they've had their first cabinet meeting. On top of that, we have had a special committee formed by decree to engage with the industry, not only Kibali, and to ensure that we -- that in the absence of the authority to do such, that we do have an authorized -- what's the right word, committee authority to be able to process and engage in finding a solution. And really, the solution is about -- we don't want to -- none of us want to do special deals in anything. We want the right to repatriate funds, not to take them out just because we feel like taking them out. They are monies that have been returned as part of our revenue and our commitment to returning the revenue from sales to the DRC, but we want to use them to do 3 things. Of course, it's very important we pay back the debt. That debt comes with, in most instances interest. So it's in everyone's interest, excuse the pun, to pay the debt back so that we can get into a bigger tax position, everyone benefits. The second part is we want to use those funds to be able to pay for services that we purchase from outside the country. And the third and final one, when all that's said and done, is we want to pay dividends because that's why we've invested in the first place. And when you pay dividends, of course, the in-country shareholders benefit as well as the government and treasury because of the withholding taxes. So -- and so there's no argument about that philosophy and it's just about making sure that we do it in a proper way. And as you can imagine, this is an important factor for all miners in the DRC now because even the copper miners after the full-up in the copper price are generating free cash and want to be able to - and then there's been a lot of capital spent in the Katanga region as we did in Kibali. So that's the background. And the money is in our private bank accounts. It's not under threat. No one's trying to take it from us. It's been a very cordial and professional engagement, and we're absolutely confident that we'll get to the point where we return to the normal operating process which we have all become accustomed to until the 2018 transition.

Okay. So we shouldn't be concerned whether these banks actually have your funds on deposit. They -- you say it's in your private bank account and you can see it.

And we're not going to have to apply for piecemeal applications. And that's what -- something that I've been very clear about is that we want a lasting solution because again, when you talk to the new government and the various ministers as well as the President's office, we were very outspoken about the 2018 code and the fact that it was an attempt to sort of aggressively harvest something that hadn't even been invested in. And now we've got 2 years on or a bit more than 2 years on. And we've got all these super commodity prices, and we've seen no investment into the DRC. So there's a real desire and a commitment to work at attracting new investments. And I must say the new Prime Minister is a young and energetic and very focused person from the industry. And I've got high hopes for the mining industry in the DRC.

Okay. And so should I think of it then that we are going to be getting this money out in installments, as was mentioned previously? And we don't...

You'll see it coming out. Whether you've got -- of course, if you've got lots of debt -- I mean loans, it will come out quickly because we want to pay those loans off as quickly as possible. And everyone understands there's a benefit to all the stakeholders, both government and shareholders. And then the rest, we want to be able to continually work with it. Because the DRC has never been a country where you worry about your money because it's never had exchange controls. And so people don't make a big fuss about whether they've got the balance, a big balance or a small balance, in the country. We invested in U.S. dollar accounts in international banks within the DRC. So it's never under threat. And then, of course, it will support the dividend policies that will come after the debt recoupment. And we've -- what we've done in Kibali, specifically AngloGold Ashanti and ourselves, is we've certainly indicated that we would be happy to pay some advanced dividends to ensure that our partners at Kiba gets some benefit while we're paying down the loans.

Okay. And so can you just confirm with me, Mark, that we do not need parliamentary approval to put a permanent mechanism in place to get this out?

No, because we've got the special committee opining on the process. But at the same time, we also need to take away the -- what's the right word, the contradiction in 2 articles within the law. And that, again, is part of this process. And again, we couldn't get it done when we didn't have alignment within Parliament, which we certainly have now.

And just one other question, just on Q2. It appears to me that with all the maintenance shutdowns that you have at several assets and better grade profiles in the second half of the year, Q2 could potentially be weaker than Q1 on a production basis. Is that something that I should think of? Is that a fair assumption?

So sort of let's work backwards a bit. So really, if you look at our guidance is 4.4 to 4.7 million ounces for the year. Midyear, we're going to be at half of the bottom end of that guidance. And then we'll fill up in the second half. That's the sort of guidance we're looking at, which will take us up well into our guidance. And so a similar outlook in quarter 2 as in quarter 1. If it's softer, it's really a small percentage. It's very -- it looks very much. If you take the 4.4 million, which is the bottom end of our guidance, divided by 2, that's more or less what our target is for midyear.

Yes, that's where we're at, too. Good luck on the DRC.

Our next question comes from Mike Parkin of National Bank.

Just with Porgera and the restart. Looking at like reported COVID numbers, they seem really low. There is a fairly significant recent jump in the numbers. Boots on the ground or at least communication to staff at site, is that -- is there any kind of COVID challenge that maybe puts a little bit of additional kind of challenge on the restart at Porgera?

So Mark, where I come from, I've dealt with -- and so has many members of my team, with numerous pandemics, viral pandemics, not just COVID-19. And the best way to manage these pandemics is with proper planning and some paranoia. Absolutely, we've already -- Mark Hill and the team, and we've started employing and building capacity back into Porgera itself. That's a very real focus for us, mobilizing the ability to do testing. We are -- we have testing facilities in all our operations now or right adjacent to them, some we own, and some are in partnership with the local authority or the national authority across our organization. And we are currently, as we speak, mobilizing laboratories into Porgera. And again, making sure that we have adequate antigen tests, which have become extremely accurate over time. And then it's all about reach out -- outreach, sorry, into the communities. We've started that. And we will treat Porgera as we start employing, as we do on every one of our operations. Of course, as you've seen that the international community has reached out to Papua New Guinea to support an early vaccination process. And again, I mentioned in our presentation that we have a global vaccine initiative that we're working on. And where we can, we are facilitating in countries where we aren't able to do it ourselves. And where we are able to directly invest and support countries and regions, we do that as well. So we'll -- and to think that -- definitely COVID is a challenging situation in Papua New Guinea, and again, that country is infrastructure and health facilities are not the best. And so you need to manage it with a real focus.

Our next question comes from Kip Keen of S&P Global.

Just looking more generally on -- in terms of acquisitions, as you look at the market out there and what's available, you see, whether it's a gold or copper company, miner, they tend to look fairly conservatively at what's available out there, that is, not much. So when you look at the potential acquisitions out there, how do you view the market in terms of what's available?

Yes. So Kip, it's a good observation. I don't know how to answer that question. There's still consolidation in my mind required, particularly in the gold industry. And again, but the problem is that a lot of the high-quality assets are embedded in individual companies. So it's hard to get a deal that brings a significant portfolio with it. Again, I think to be able to do value-creating M&A, one needs the support of the fund managers and investors. Otherwise, it's a better option to continue to explore. And hopefully, I've demonstrated that Barrick's real focus over the last 6 months, once we got settled, is really building that capacity for organic growth. And so -- and then on the copper side, too, there's very few pure copper plays. I think everyone, again, has been caught flat-footed in this copper price run-up. As you know, we've been talking about it for a long time, and we've certainly focused in on our portfolio to make sure that it's efficiently run and we maximize the returns on a rising copper price. Again, we've invested in additional expertise in our exploration teams to be able to build better copper exploration strategies and also through the whole spectrum of various gold, copper geological environments. And -- but at the same time, in markets, there are always opportunities to benefit from -- to deliver value. We've proved that through our history. And so Barrick and Randgold have delivered significant value through opportunistic M&A transactions throughout their history. So we're constantly looking at opportunities. We run our ruler over any new announcement, any new development. And what's important is we have the skill base and the balance sheet to be able to exploit an opportunity when it does arise, and we'll continue to do that. We are kept honest by our filters, I might add, Kip. We're not growth -- we're not obsessed with growth, but we are obsessed with creating value through growth.

Yes, no, fair enough. Well, in that sense, given the dearth of discovery in the past, say, 10 or so years, I mean do you put more focus on exploration? Obviously, you have done to a degree, but does it become a greater focus in the next couple of years?

Yes, there's a great slide that we shared with the market when we announced the merger with Randgold Resources, where we showed the growth in Barrick and Randgold Resources and the value creation from primary discoveries, but also equally, both companies delivered significant value by post-acquisition expansions. And Kibali is a classic example in the DRC. So that's really -- that -- the best way to create real value in this industry is to make your own discovery. The second best way is to find somebody who's made the discovery and hasn't worked out how valuable it is yet. And so therein lies the importance of having a highly skilled exploration and mineral resource management team in one's business.

Our next question comes from Brian MacArthur of Raymond James.

Mark maybe just following a little bit on that discussion. And we did talk a bigger copper portfolio earlier, and you mentioned Reko Diq in Pakistan. So just a couple of questions. First of all, can you remind me where we stand on that potential award settlement? And the second part, I guess, is a more philosophical question. I mean again, that project, if I remember, had decent infrastructure, pretty good geology. But it's also in a pretty tough country, but that's something, as you've said in the past, you've had the skills to deal with. Are you thinking more now philosophically that's something you might like to develop? Or you just have to wait for the settlement? Or is it something more that now that copper price is up, these things, as you said, are pretty scarce, maybe there's a partner or somebody else that can come in and develop it. Just philosophically, how you look at something like that.

So as you know, one of the philosophies that we brought in Barrick in 2019 was, I'm not a big one that takes on host countries in a fight. And so we reached out on the back of what John thought and had already started, to find a solution that was constructive with the Tanzanian government. And we've been very successful in that. Again, you've seen us manage situations whether it's -- historically, we had issues over in Mali, because governments don't -- are not there for long anymore in this modern world. They move -- turn over quite a lot. I mean I think I've worked with like 20 different finance and mines ministers in Mali. And we did the same in South America, both in Argentina to build a stronger, more transparent, engaging partnership with both the Argentinian federal government, and more importantly, the San Juan provincial government. And we did the same in dealing with the legacy challenges around Pascua in Chile. And we've built a much stronger, better relationship in Chile. And whilst we've got some way to go to evaluate fully the potential of Pascua, we are busy with that. So we've done the same in Reko Diq in that there is an award out there. It's a $6 billion award. It's shared with our partners, Antofagasta. To go and try and garnish that amount of money from Pakistan, which has just been lent $6 billion by the World Bank, IMF, it's a hard task. And we believe that it's a world class asset, as you point out, Brian. And there's merit in finding a way where we will earn back our own award. And if Antofagasta can't get their head around operating there, we'll find a -- work to find a way to compromise and settle on their side of the claim. And that area has got enormous mineral endowment, both gold, copper and other rare elements and metals. So -- and as I've experienced in my professional life, when I first started out in Sub-Saharan Africa, it was almost a no-go place. And today, it's very easy to operate in. So the world moves on, and I think that we've had very constructive discussions with the Pakistan and Balochistan authorities. And I would -- I can certainly say, Barrick's prejudice is to find workable compromise solutions that deliver constructive outcomes to these often acrimonious situations. That covers your question.

No, that's very helpful. So I mean you are still able to negotiate even though this settlement's out there?

No, we're absolutely because there's very clearly -- the settlement is not there. The award has been approved. And now it's how does Pakistan deliver on that, and again, just building on my own personal view about responsible mining and how we deal with our -- those countries. But the same -- we've started that even before the -- we took up the Randgold deal. And it's much more constructive to do that where people benefit out of paying off a sort of judgment like this. But again, there's water to flow under the bridge and we've got a bit like the Porgera -- I mean Pogera was a pretty challenging engagement, but the outcome, I hope, will be worth it for all stakeholders.

Great. I'm just trying to figure out what the option value might be there because it could potentially be meaningful.

I mean that option value is a good way to look at it. It's -- there's a value. And what we prepare to do is take a long-dated position as far as getting full access to that value.

Our next question comes from John Tumazos of John Tumazos Very Independent Research.

Congratulations on all the great work, Mark. How is the outlook for just getting around and drilling all the meters you want to drill and exploring and replacing reserves this year, given the pandemic?

Well, as you know, we haven't stopped. I fundamentally believe in managing by walking about. And we've continued as normal. We've just finished -- as part of this quarter 1 results, we had full management reviews with all our operations and on-site team effectiveness and strategic review workshops. So it hasn't -- we've had to be a little flexible in the way we do things. On the drilling side, the big challenge is to get drill companies to work for us. In Africa, we are Boart Longyear's biggest clients and have been through all -- every part of the cycle because we believe in investing in our future. We've worked very hard to get drill rigs into -- onto the Andes. It's been a big challenge during this time. And certainly, from the Argentinian side, we now have drill rigs up there. We've -- as you would have read, we've just completed the drilling, some confirmation redrilling on the Chilean side in Pascua. But again, we could do with a few more rigs. At this stage, we've been working on incentives and how we partner with the drilling companies to be able to achieve our objectives. A fantastic example of the tenacity that's required to get rigs into some countries, particularly over a crisis like this has been Saudi Arabia. But again, you saw today the results of that effort to bring rigs into the country and get the drilling started. So those have been the biggest challenges. Again, in Nevada, we've had to work much harder to build a more business relationship with the drilling companies. I don't think we're quite there yet, but we are prepared to invest in drilling companies to be able to get them to a level where they are able to deliver on what we want them to do. So -- and we see that as a very critical part of our business. So I think in summary, the challenges have been the Andes, for many reasons, because Chile is also battled with the COVID pandemic, and Argentina as well. But again, I'm pleased to say that the teams have made progress, and we do have drilling ongoing. We just mobilized. Last year in Donlin, we didn't have a single COVID case, touch wood. Hopefully, it continues this summer. And so we've just mobilized the rigs into Donlin. We are demobilizing the rigs that are down in the Andes right now because we're moving into winter.

Mark, in other cycles, 10 years ago, it was hard to get the tires for the big trucks. Maybe once or twice a generation or so ago, cyanide was short. What else besides drill rigs is hard for you to get enough of besides Gregg drill intercepts?

So again, John, our focus, I mean what we bring is mining, I often say, is all about logistics, supply chains. We've got -- I would argue we've probably got the best supply chain organization in the mining industry. And I mean when you see how they manage this -- the impact of this crisis and built flexibility, as soon as we saw it coming, we built flexibility into our supply chain. We were able to switch from China to Europe, back to China seamlessly on supplies, things like cyanide in particular. And again, we are all about long-term relationships. So we've done a lot of work. We've built some very strong partnerships on a global basis with tire suppliers. And again, because we're loyal through the cycle and the fact that we run long-term contracts, we find that we have less -- we've rarely, very seldom been held to ransom by our long-term partners, on every aspect of it. And we run our own -- we have visibility of every single consignment. We manage every aspect of the supply chain, and we monitor it because effectively, we just move stuff as miners. We blast the stuff underground or in the pit, we move it to the processing plant, we move a whole lot of stuff to the processing part to process that ore, and then we ship out bars of gold. So it's just one big movement. So I can clearly confirm that on the tire side, we're in good shape. We're certainly expecting some squeeze. But again, we've spent a lot of time building those relationships across the Barrick group. And we've got a lot of buying power, as you can imagine.

So Mark, you made overtures a year or 2 ago toward Freeport when copper was bottoming. It was a good show. They didn't want to dance, but you gave it a good try at the right time. Almost tongue in cheek, maybe you should take a look at Ford Motor. They're having a big trouble with logistics. Their output is down 50% this quarter.

So I'm glad you recognize that my copper vision was -- had merit. Yes, I mean maybe we should have done it a little differently, but certainly, what it proves is that we are absolutely focused on creating value. And we recognize when there's an opportunity. I think we also learn from times when we fail on our endeavors. But at the same time, we are not reckless in how we engage on pursuing opportunities that we recognize. So that was one opportunity. We're hunting some more now. And I think what I hopefully shared with you today is that we're also investing in our own future, which is, in my career, that's always been the biggest value creator.

Mark, sometimes the other guy knows every one of those assets are good and his commodity is low. So once in a while, they're going to say, no, but keep trying.

Exactly. Don't you worry. Don't you worry.

There are no more questions from the conference call.

Well, thank you, everyone. That was quite a conversation, and really appreciate your input and for you to stay in with us in this conversation. Again, look forward to the next time we talk. And hopefully, everyone will make an effort to join the Nevada Gold Mines team and its virtual Investor Day coming up. And I'm sure you'll find it very interesting and see a little bit more of the color and detail of what that team has achieved with a set of really high-class assets. So again, thank you for your time. And again, if there's anything that you've forgotten to ask or you think of after we sign off, please feel free to reach out to the team. So again, thank you.

This concludes today's conference call. Should you have any additional questions, please contact the Barrick Investor Relations department. You may now disconnect your lines. Thank you for participating, and have a pleasant day.