Good day, ladies and gentlemen, and welcome to the Tronox Limited Third Quarter 2016 Earnings Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. As a reminder, this call is being recorded. I would now like to turn the call over to Brennen Arndt. You may begin.

Thank you, Michelle, and welcome everyone to Tronox Limited's third quarter 2016 conference call and webcast. With me today are Tom Casey, Chairman and CEO, and Tim Carlson, Senior Vice President and CFO. Joining us for the Q&A session will be Jean-François Turgeon, President of Tronox TiO2; Ed Flynn, President of Tronox Alkali, and Kevin Mahoney, Vice President and Corporate Controller. We will be using slides today as we move through the conference call. Those of you listening by the Internet broadcast should already have them and for those of you listening by telephone, if you haven't already done so, you can access them at our website tronox.com. A reminder today that our discussion will include certain statements that are forward-looking and subject to various risks and uncertainties, including but not limited to the specific factors summarized in our 2015 Form 10-K, our quarterly report on Form 10-Q for the quarter ended June 31, 2016. This information represents our best judgment based on today's information. However, actual results may vary based on these risks and uncertainties. The company undertakes no obligation to update or revise any forward-looking statements. During the conference call, we will refer to certain non-U.S. GAAP financial terms that we use in the management of our business, including EBITDA, adjusted EBITDA, free cash flow and adjusted earnings per diluted share. EBITDA represents net income before net interest expense, income tax and depreciation, depletion and amortization expense. Adjusted EBITDA represents EBITDA as further adjusted for non-cash unusual and non-recurring items. Free cash flow represents cash flow provided by or used in operating activities less capital expenditures and adjusted earnings per diluted share represents EPS adjusted for unusual or non-recurring items on a fully-diluted basis. Reconciliations are provided in our earnings release. It's now my pleasure to turn the call over to Tom Casey. Tom?

Thank you very much, Brennen. Before I start, let me make two points. One, I want to welcome Tim Carlson. This is his first call. We did not ask him to take on the full presentational load for today, but we will be at conferences later this month, Tim will be with us and I hope you'll take the opportunity to come up and introduce yourself to Tim and meet him. I'm sure that you'll be as impressed as we are. And we're very pleased and excited about the prospect of Tim joining the team. So, Tim welcome. Also, I want to congratulate all of those – those of you who are in Chicago or like Chicago as Boston Red Sox fan, I can appreciate the feeling of having won a championship after a 108 years, so congratulations to the Cubs. With that, let me go into the main part of the presentation. As Brennen – and I appreciate the introduction, Brennen – in the third quarter, we delivered very strong adjusted EBITDA and free cash flow performance. The positive momentum that we talked about in our TiO2 business last quarter that we've seen since February continued in the third quarter. We had higher sales volumes and pigment prices on both the year-on-year and sequential basis. And we coupled those positives with continued strong operating cost performance. Our Alkali business returned to adjusted EBITDA and free cash flow levels that overcame and even exceeded that series of one-off items that impacted results in the second quarter. In TiO2, pigment selling prices increased by 6% sequentially and were 1% above the prior-year quarter, confirming that our positive inflection is significant, this marks the first time since the third quarter of 2012 that pigment prices were higher on a year-on-year basis. And…

Thanks, Tom. I'll begin today with the review of corporate and consolidated items and then move to our balance sheet and cash flow statements. The corporate loss from operations in the quarter of $16 million was equal to the loss from operations of $16 million in the year ago quarter and compares to a loss from operations of $9 million in the second quarter. Corporate adjusted EBITDA was a negative $17 million compared to adjusted EBITDA of a negative $18 a year ago quarter, as well as adjusted EBITDA negative $16 million in the second quarter. Corporate cash used in operations was $108 million and capital expenditures in the corporate segment were $1 million in the quarter. at $170 million to $180 million. Selling, general and administrative expenses were $54 million in the third quarter level essentially to $55 million in the year ago quarter and $50 million in the second quarter. Interest and debt expense was $46 million in the quarter also essentially level to $45 million in the year ago quarter and $46 million in the prior quarter. On 30 September 2016, gross consolidated debt was $3.05 billion and debt, net of cash and cash equivalents was $2.85 billion. The cash and cash equivalents of $202 million increased from $188 million in the second quarter and our liquidity also increased to $470 million from $460 million in the second quarter. Our blended cost of debt in the third quarter was 5.56% and on 30 September 2016, 48% of our total indebtedness was set at a fixed rate. Capital expenditures were $32 million in the quarter and depreciation, depletion and amortization expense was $60 million. Regarding our debt maturity and financial covenants, we have no meaningful maturities until 2020. Only an annual 1% payment on our term loan and…

Thanks, Brennen. Again, as we've said, our TiO2 business generated additional momentum in the third quarter from a very positive second quarter. This is again driven by higher pigment sales volumes, selling and selling prices both year-on-year and sequential. I want to also point out that it was coupled with strong operating cost performance that we continue to achieve which is a testament to the management and the people who are working in that segment and I want to acknowledge to that too. We expect the tight global supply demand balance will continue into 2017. We think that pigment inventories in aggregate are at or below normal levels at both the customer and producer locations globally. And that pigment producers are running at high utilization rates. We are and we will continue to match our production to meet demand while keeping inventory at or below these normal levels. In August, we announced the pigment price increase which was our third announcement over the last nine-month period. In the last two quarters, we've raised pigment selling prices by more than 10% above their first quarter trough level. We don't expect selling prices to revert in the fourth quarter either. We continue to believe in the fundamental market conditions and that they will continue to trend positively. First, while demand is strong, pigment finished goods inventory levels are relatively low as I've just said and plant utilization is running higher. We know, in fact that some customers are already not having their orders filled as they wish. Recall that our sales volume in Q3 was higher than in any period since the second quarter of 2011. Under these market conditions, even normal growth is threatening the availability of supply and at the same time, pigment producers facing cost pressures. Ilmenite prices have…

Our first question comes from John Roberts of UBS. Your line is open.

Good morning and welcome, Tom.

Good morning, John. Thank you.

Sorry, welcome, Tim.

Thank you, John.

You can welcome me too, it's all right.

Okay. Thanks, Tom. Tom, you talked about channel inventories being low, but with volume up 6%, which is well above GDP, what gives you the confidence that some of that hasn't gone into the channel? I remember several years ago, I didn't think we had a really good grip on what was going on in the channel back then and I kind of feel a little uncertain today as well.

Well, we like you, we think that when we look back on channel inventory level management back in three years or four years ago that we were surprised at the levels there. So we have increased our attention being paid by our sales people and our field people and our customer service people to watching the inventory levels at our customers. We obviously are interacting with them all the time. We don't know intimately, I mean, obviously we don't report a number. We don't get reports from them daily, any level of precision like that about inventory levels, but we are focused on being aware of the inventory levels at our customers. A number of our sales operations are based on – where we actually put our supply on the customer location and we can measure that, in fact on a pretty continuous basis. So we have a much better view, I think of inventory levels at our significant customers and across the customer channel altogether globally, as well as in the United States. So we feel more confident about it.

Okay. And then, secondly Huntsman last week, I think implied that U.S. prices could plateau here, but that international prices still had a way to catch up to the U.S., could you comment maybe on the regional outlook in pricing?

I don't know that we've done that. We don't – generally speaking, talk about individual region pricing. Our view as I said, though, but I can tell you, look our view is that prices in Europe and in Asia were lower than prices in the United States and the other North American markets. And we expect prices across all regions of the world to continue to increase. Whether they increase at the same rate or not is another matter. I don't – again, we don't really want to talk about disaggregation at that level. But we're positive about prices going forward. We expect that prices in 2017 across – on average across the world and across all of our sales will be almost as high if not as high as they are in 2016.

Okay. Thank you.

Our next question comes from Hassan Ahmed of Alembic Global. Your line is open.

Good morning, Tom.

Good morning, Hassan.

Tom, just wanted to chat a bit about some of the nearer term trends you're seeing as they pertain to Q4, obviously, you know very cognizant of the fact that Q4 is seasonally weak quarter. But, from the sound of it it seems that you're guiding to -- holding on to pricing sequentially within pigments, A, is that correct; B, just could you broadly speak directionally, sequentially what to expect within or as well as pigment as it pertains to pricing, Q3 to Q4?

I think what we said was, we don't like to give guidance. We haven't been giving guidance, particularly not in the middle of a quarter, not in a period that we're in the middle of, because people would take it as, I think very seriously. So let me say this, we said, they are not – prices will not revert in the fourth quarter and we said, we think prices will increase in 2017. So that's our view. I mean, we know that. And as you said that fourth quarter is a seasonally light quarter. It's generally speaking, volumes are down in the fourth quarter, prices reflect the lower demand, but we're saying that we don't expect any reversal, any reversion in the path of prices upward in the fourth quarter.

Perfect. Now, as a follow-up on the Alkali side of things, you know, Tom, it seems that there is some incremental sort of supply coming on stream near-to-medium term, obviously, you guys did a good job in Q3 in reverting back to a more sort of normalized EBITDA level, but how should we think about the sustainability of that EBITDA level in the face of some incremental supply growth over the next year or two years?

Well, let's talk about that. In Turkey, the biggest supply increment of supply that we can identify is the plant – in plants, plural, in Turkey that Ciner is operating and bringing online in 2017. They have a 500,000 ton incremental production in the sort of middle part of 2017, scheduled for the middle part of 2017, we don't know when it will actually show up, of course. And then, another one, I think a million ton production facility coming in at towards the end of 2017. So we expect that will be largely felt in the marketplace in 2018, to be honest. But this is a 60,000 ton, 60 million ton market globally. And the Ciner supply in Turkey is natural soda ash, so we'll have similar cost characteristics to what we have in the United States. Europe is largely supplied, and the Middle East and Africa are largely supplied by synthetic producers with a much larger or much higher cost structure than a natural soda ash producer. So we would expect that the vast majority of the short-term volume coming out of that that new facility will go into Europe and go into the Middle East and Africa regions. We don't expect to see a big impact in North America, because we're already competing, we already have a cost structure comparable to theirs and we don't have the transport costs associated with moving that product in. With respect to China production, China has presence in the Asia-Pac markets largely. All along, they set the price in the Asia-Pac markets, because they are the highest cost producer. We generally can sell what we want in the Asia-Pac market in terms of volumes, and the price in the market will be set by the highest cost producer. As we talked about a couple of quarters now, costs for the Chinese producers, who are largely how and synthetic – method production facilities. Their coal and their other input costs, their shipping costs, their energy costs, all went down, the yuan went down, and so their whole cost structure moved down, that allowed them to move their price into the Asia-Pac markets down. And we, of course then match the price and continue to sell at volume in Asia-Pac. As their cost move back up which we – as I said we've already beginning to see some signs, particularly in the coal market, then their prices will have to move up with it, and we expect that to be certainly not worse and potentially better.

Very helpful. Thank you so much, Tom.

Yeah.

Our next question comes from James Finnerty of Citi. Your line is open.

Good morning, Tom. Congrats on a solid quarter.

Thank you very much. Good morning.

So, just going back to, the one data point we continue to see that doesn't seem to line up with the price increases is the exports out of China. Can you just give us your thoughts there when you might expect that to sort of decrease on a year-over-year basis or at least stop growing?

Yeah. I think that China exports are in aggregate about 750,000 tons, it's running at that, it's running at a slightly lower level for the last four months. The high for the year, in terms of monthly exports was made, and it's down a little bit from that. Most of those exports go into India, some come into the United States, South Korea is a big export market for them. A lot of the increase in those other markets is supply coming out of Brazil where China exports were down very, very significantly in the month of September. So the question for us is, do we confront China-produced supply in the market as a competitive alternative to our supply. And as I've said, we don't. They are supplying customers all over the world, but generally speaking, the kind of customers that will buy our high-quality pigments are not simultaneously looking at for the same supply need Chinese product. Someday, that might be different, but it's not case now. In the longer term, we look at the various additions and subtractions of production in China. And as I – we've talked about this before, but our own people on the ground as well as some third-party experts believe that aggregate production, net production, so production, net of both additions and withdrawals or closures, it was down last year. It's going to be down this year, and it's going to be down next year. And so, to the extent that China is – the domestic demand increases, that demand is increasing against the smaller supply level to the extent that China – that global demand is increasing which we think it is at a sort of 2.5% to 3% rate, then there will be less Chinese supply, because the supply is constrained for this period of time as I just said. As demand grows domestically, more and more supply will go into the domestic market, which means less will be available for the export market, and Chinese share in the global market we think is going to decline over the next several years.

Great. Thank you. And then, on the inventory levels, you mentioned in the press release that they were at or below sort of normal seasonal levels, just what would normal seasonal levels be for third quarter and where would you be relative to that above it or below it?

We are below it. In the third quarter – the average – at this point in the year, normally you would be building a little bit of inventory to prepare for the season next spring. You'd probably build a little bit more in the first quarter. I think that now would be, JF, what 50-ish days? Jean-François Turgeon - Tronox Ltd.: Yeah. We are below that, but (35:36)...

And look, I think, also, James, that if – we're below 50 days and we're running the plants all out, that basically means that if – that there will be customers that we don't serve, that we might otherwise serve if we had more product to sell. I believe that has something to do with the Chinese export levels that if we are typical of the other Western producers, then they are running at low inventory levels and at full production and so as demand grows, they're going to serve strategically important customers or higher paying customers and there will be customers that will be left with some of their demand un-served that might be the explanation for China export levels in the last couple of quarters.

Okay. Just on a related note, given you're saying that some deliveries aren't being made – market is getting tighter, is it correct that you still have capacity curtailed at Hamilton and just sort of what should we think about that with regard to potentially bringing that back online, is it a possibility in the next 12 months to 18 months or should we...?

It's on. It's back.

It's back. Okay.

It's back. We're back. We're running at – all of our production capacity is running at Kwinana, at Botlek, at Hamilton, all three of our pigment production plants, not in the furnaces, mind you. But then, but all pigment production is running all lines and we're running at full capacity.

So your operating rate for the third quarter would be or currently would be (37:14) 90%-plus?

Yeah, plus-plus percent.

Okay. Thanks, Tom. Appreciate it.

And again, we're not – against that operating rate, we are not adding to inventory. We are maintaining inventory at or below normal level. So my point is, we are now like – in pigment, almost like we are in Alkali which is we're in a position where every ton we make we can sell and more, in fact, but that's where we are right now.

Great, thank you.

Our next question comes from the Roger Spitz of Bank of America. Your line is open.

Thank you and good morning.

Good morning.

On Alkali, can you comment on the $9 million of items in Q2 that didn't repeat? And I think you've said the business is not seasonal, though movements of the longwall mining equipment can – periodically can be lumpy. But with that – so with that said, is in this current market environment is the right quarterly EBITDA a $40 million – of this quarter, is it closer to the $35 million? Thank you.

The one-time items we specified them in the last quarter. Some of them were – we made some preparation for continuing supply production in anticipation of the union negotiations in case those didn't end successfully. Ed, do you have more detail on that just to cover the $9 million (38:44).

Yeah. It was the longwall (38:50) largest of the three items. The labor contingency, which Tom talked about, was the second one. And the last was IT transition items, transition to Tronox computer systems from the former parent. Those are the three big items that were one-time.

Thanks. And so, all those are gone. With respect to the run rate, yeah, I think the run rate EBITDA on a quarterly basis – well, let me say, first of all, you are right to talk about the disruption of the longwall. We have to move the longwall machinery every 14 months or so, right, 13 months, 15 months somewhere in there. And so, whatever quarter that that longwall moves, we're going to see $5 million maybe,

$45 million.

$45 million of one – expenses in that quarter associated purely with that – the move of that equipment. But, the run rate on this business is – you know, the quarter was, the quarter – third quarter was good. There will be quarters that are shorter and – so, maybe around there, around there. I'm looking at it and I don't want to acknowledge that less would be better, but – go ahead.

When are you next moving a longwall equipment?

Probably be in the third quarter of next year.

Okay.

Third quarter of 2017.

Of 2017, right. And I know you didn't sell any titanium slag, but can you comment on the price level movement for Q3 versus last quarter or last year, just to give us a sense?

It was a flat last – quarter-on-quarter, JF? Jean-François Turgeon - Tronox Ltd.: Yeah. There was no movement in the slag zircon. It's been stable from Q2 to Q3.

If that's the case and you sold last quarter, did you – you didn't sell this quarter not because of pricing, but because you want use it internally, perhaps even though I think your long bite, I don't know 200 KT (40:57) something like that?

Well, I mean, it was an opportunistic sale last quarter.

Okay.

For reasons that had – that basically had to do with this the particular customer. But, we're not long – we're long theoretically, but as we've said, we've shut down two of the four furnaces in South Africa. So we are not – we're are running our slag inventory down, in fact. We are not producing in excess of demand. One of the reasons that the furnaces are closed is, we want to deplete the built-up in the slag inventory that we have and I suspect that's why others who are have closed their production facilities in feedstock are doing the same thing. We are all working our inventory of finished goods down and when that inventory level gets back to normal, then we'll have to decide what happens with respect to price and/or turning on the furnaces or whatever, but that's not – that's what we're doing right now.

Thank you very much.

Yeah.

Our next question comes from Owen Douglas with Baird. Your line is open. Trelford Owen Douglas - Robert W. Baird & Co., Inc. (Broker): Hi. Good morning, guys.

Good morning. Trelford Owen Douglas - Robert W. Baird & Co., Inc. (Broker): I wanted to follow-up on that question about the slag. So right now, there's excess inventories, do you have a sense for how far we are from normal in terms of titanium slag inventories around the industry? Jean-François Turgeon - Tronox Ltd.: Look, I would say that, at the moment, there's probably still 3 months to 6 months of inventory, but if all the main pigment producer have done like us in Q2 and Q3 by turning up their pigment production, obviously, that can quickly disappear. Trelford Owen Douglas - Robert W. Baird & Co., Inc. (Broker): Right. So - Jean-François Turgeon - Tronox Ltd.: Yeah. Trelford Owen Douglas - Robert W. Baird & Co., Inc. (Broker): Sorry, continue? Jean-François Turgeon - Tronox Ltd.: Yeah. We normally say when there is a turn in TiO2 in pigment normally 6 months to 9 months after we see that turn in the feedstock market so.

I mean, let me just make another broader point on that point, a follow-up on what JF said. If the pigment operators, as you said, are running like us in the sense that their inventory levels are at or below normal and their utilization rates are essentially full out, then they will look to their feedstock supply and to the extent that they are using lower grade feedstocks, whether it's ilmenite or whether its slag without rutile or synthetic rutile, they will look at the economics of improving the titanium content of their feedstock, because that will allow them to produce more TiO2 out of the same number of hours of production, if you will. And so, I don't know about anybody else's economics or what their feedstock mix is, but in general if you are in a market in which supply is constrained relative to demand, then you're going to try to figure out a way to increase your supply without increasing your capital spending and the best – or a way to do that is to maximize the TiO content, the titanium content of your feedstock, which means going to higher grade feedstock blends that will in turn increase purchases of those high grade feedstocks, it'll deplete inventory levels faster and so on and so on, so on. So combined with the ilmenite cost increases that we've also mentioned in the last couple of quarters that incentive to improve the quality level of the blend of feedstocks being processed at pigment plants is another favorable factor of affecting our view of where the slag and synthetic rutile market is going. Trelford Owen Douglas - Robert W. Baird & Co., Inc. (Broker): Okay, appreciate that. So, give me a sense for in your estimation, as you look to restart these furnaces next year, are you looking to bring back the two ones that were idled right away or do you think we'll need feather in a bit?

Look, I mean, as we've said we are matching – we're trying to match our production to our demand net of the inventory reductions we want to let go. So we're not going to talk about the specific month. We have (45:28) plan, but we're not going to talk about the months that we would bring these things back. We're trying to be market responsive and that's what we intend to do next year with – in terms of bringing facilities back, but it's our anticipation that production facilities on the feedstock side will be coming back during next year. Trelford Owen Douglas - Robert W. Baird & Co., Inc. (Broker): Okay. Thank you very much.

Our next question comes from (45:57). Your line is open.

Hi. I was wondering if you guys could give us an update on the cost reduction initiatives and how much is left to still be realized.

We said we're going to do that in detail twice a year. We did it after the second quarter. We would do it again after the fourth quarter. But, we are on track to exceed our 2016 target.

Can you quantify how much of the EBITDA increased year-over-year was due to cost reduction?

Can I? Will I?

Both.

Can I? Yes, probably. But, no we're not doing that. So, I mean, look, we said earlier that we would produce, we would go into detail on the various sources of our cash generation and cost savings twice a year. And if you look back on our second quarter release, we have a fairly extensive bridge in the materials where we did that. We would do the same thing again in the fourth quarter at the end of the year. And I think that will allow you to make that sort of judgment through – when you look at those you'll be able to make that that assessment, I think.

Okay. Thanks.

Okay.

Our next question comes from A.J. Lily (47:24) of Invesco. Your line is open.

Hi. Congratulations on the quarter. I just had a couple of housekeeping issues. You talked about CapEx being $140-odd-million for the year as your budget, in the third quarter – as of the third quarter it looks like you've only spent $87 million, is that right to understand that the remainder of that is going to come through in the fourth quarter or is there something accounting related where it's not showing up in the cash flow statement and it's showing up in earnings? And second question was, do you hedge your CapEx expenditure, I guess, a lot of that products (48:02)? The third question I have was just around working capital, again, referencing page seven of your second quarter, you projected another substantial reduction in working capital for the second half, but it looks like your working capital progress this quarter wasn't in line or in track with that unless I'm missing something?

Let me try and take them in order. The CapEx there will be – I think our 2016 total CapEx will be lower than that estimate. So there won't be this huge explosion of fourth quarter capital spending. We don't hedge. We had some things, but we don't hedge the rand directly. And on working capital, yeah, the part of the working capital – a good part of the working capital estimates were – have to do with inventory reductions, and as we make decisions about where we put slag, that will obviously affect our inventory level, and that in turn will affect the working capital levels from period-to-period. As I said, I think to the prior caller, we're optimistic about the aggregate savings in 20 – the aggregate cash generation in 2016 exceeding what we set out as the target for 2016. There might be a little bit of back-and-forth between operating expenses and inventory free up, but we think that that's going to balance itself out. If there is that that shortfall as you mentioned, that's going to free up in 2017. So it's just shifting from one period to another period we think. Jean-François Turgeon - Tronox Ltd.: That's right. There some timing associated with sub-shipment of mineral sand product out of South Africa that also explain why there will be a change.

As an example, we had – as I said earlier, we had no slag sales in the third quarter, and we already have a significant slag sale in the fourth quarter. So, it varies from period to period is my point.

Sorry. I don't understand the capital point. Why you're saying that there might be a bump, and you're still maintaining $140 million forecast for the year? How can there not be a bump?

I didn't – I'm sorry, if I said we're going to maintain $140 million, I thought I said, I meant to say that we're going to come in less than $140 million.

Can you give a sense to where or just...?

No. I haven't is the problem. So I don't want to do it now. But, there is not – I understand the point that that given where we have reported capital through the end of third quarter, there would have to be a massive spend in the fourth quarter to reach our target or the target is too high and you're asking basically, which it is, and I'm saying that the CapEx target of $135 million or $140 million is higher than we will actually report at the end of year.

Okay. Thanks.

Okay.

Our next question is a follow-up from Roger Spitz of Bank of America. Your line is open.

Thank you for that. On the Fairbreeze EBITDA, in the past you've talked about how much EBITDA that could generate. Given where market conditions are, can you give an update for like whether 2017 or beyond, how to think about Fairbreeze?

Yeah. With respect to Fairbreeze, we have from time to time, we have talked about the total amount of zircon that that mine can be expected to produce, the total amount of natural rutile that can be expected to produce and the total amount of ilmenite. And if we were to sell those products into the market you know at whatever the market price was at the time, we'd sort of did a theoretical EBITDA calculation. So you're right about that. What we do with the product, however, is we actually incorporate almost all of it in our internal operations, so the ilmenite comes out and goes into feed the KZN smelters largely. The rutile either goes into sweetening the blend, so that again we have higher TiO2 content in our South African operations or it goes into the welding market and the zircon – it's a very good zircon mine, so we sell that into the market. The EBITDA is, is what it was. I think we said there would be 30,000 tons of rutile a year, 60,000 tons of zircon a year. We thought that there would be $10 million of reductions in some of the transport and other extra expenses that we had when we were running KZN off ilmenite produced (52:52) and elsewhere. And all those numbers are still the same. It just – we're basically absorbing most of the Fairbreeze production internally now so.

Okay. And in terms of a net leverage target, would you be willing to give one either for the end of this year or perhaps the end of next year?

No. We haven't done that. What we've said is that as we generate free cash flow, we will use that not to dramatically increase capital spending nor to increase any other form of spending other than debt repayment. Our primary use of the free cash flow that we generate will be debt reduction.

Okay. And lastly, I don't know if you'd like to give just a very general view of what 2017 CapEx might look like. Is it like 2016 or (53:56) you're not going to be spending it on from 2016, so maybe it's lower?

Yeah. Well, I mean, we're in the process now. So I don't have a specific number. The Fairbreeze CapEx will be tailing off. So that will be a net reduction. There are some other projects that I am sitting here with Ed and JF, and so I don't want to get too specific. But there'll be some projects that have probably been on hold for the last couple of years that they're going to be fighting hard to get funding. So the net net is, it's not going to be – I don't think a huge move either way, what I would say right now. But again, we're in the middle of the process. So I don't actually know the specifics yet.

Understand. Thank you very much.

Okay.

Our last question comes from the James Finnerty of Citi. Your line is open.

Sorry about that. Just wanted to get your thoughts on the zircon market in terms of supply and demand and just so we can get an idea of what we should think about pricing in 2017 relative to 2016?

Yeah. As JF just said, zircon prices have been pretty stable for the last couple of quarters. The aggregate supply and demand situation is, I think there is probably, it's probably fair to say that there is a surplus of zircon in the market. Prices have then – came down in 2015 and in the early part of 2016 as a result of that, but they've stabilized at the level they're right now for the last couple of quarters. And we anticipate that there will be an increase in demand for zircon over – certainly into 2017 for a variety of reasons, but one of them is, we think that some of the end-user customers are moving back to zircon from other materials that they used when zircon prices were very high. And we think that net-net prices are probably going to be stable perhaps a touch up on zircon in – as we go forward to the next four quarters or five quarters.

Great. Thank you. And just on the debt reduction, is the intention to build cash or will you actually be paying down debt and if so would it be more focused on the term loan or on the bonds or will it be opportunistic?

We are running – yeah, I think we reported $200-plus-million of cash at the end of the quarter. That's certainly enough and probably a little more than enough in terms of funding our regular operations. So I think we'll look to pay it back. What we paid back or what we buy back or how we do it will depend on prices in the market at the time and where we have opportunities to do it efficiently. I mean, we bought some bonds back earlier in the year when prices were very low, so we're willing and able to do that. So we'll just look – when we have the cash, we'll look and see what's the most efficient way to spend it to reduce debt. But, the overall point is that, our objective with surplus cash is to reduce debt.

Great. Thank you.

Okay. Operator...?

There's no further questions. I turn the call back over to Tom Casey for any closing remarks.

Thank you very much. And thank you all for your interest and being on the call and listening to Tronox. One final announcement I will make is that, as many of you, I hope know, you were asked to vote on a couple of amendments to some of our documents, our constituent document for a shareholder meeting that is scheduled to occur today. The last one of those amendments has to do with adopting a majority voting rule for directors and under Australia law, we needed 80% approval rate to pass that amendment. The final votes are not yet counted, but the last thing I heard as of late last night was that, we were at, something like 79.7% or some incredibly close number. If that is the final report then what we will do is, I think we will adjourn the shareholder meeting and go out and try to find those other votes. So I would ask you, if you haven't voted, please do so, if your friends haven't voted, please ask them to do so, if your family hasn't voted, please ask them to do so. We are very, very close to being able to resolve this in what I think will be a positive way. And so, please check with your proxy and governance people to make sure they all voted, because that will be helpful. We're very close. We may have actually passed it, but if not, we're going to be very close and we're going to go out looking for those votes. All right, so thank you very much. We appreciate it. Thank you. Bye.

Ladies and gentleman, thank you for participating in today's conference. This does conclude the program and you may all disconnect. Everyone, have a great day.