Welcome to the Gran Colombia Gold Q3 2020 Results Webcast. My name is Venessa, and I'll be your operator for today. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session . Please note that this conference is being recorded. I will now turn the call over to Mr. Mike Davies, Chief Financial Officer.

Great. Thank you, Venessa. Good morning, and thank you for joining us today for the Gran Colombia Gold third quarter and first nine months 2020 results webcast. With me on the webcast this morning is our CEO, Lombardo Paredes. And as is customary, I'll first go through our prepared remarks regarding our performance in 2020 and then Lombardo will be available as we open things up for the Q&A session.

Thank you, sir . I do have a question in queue. I have question from Sid Rajeev with Fundamental Research. Please go ahead.

Hi, Mike. Congratulation on another strong quarter. I mean you’ve buying back shares, increasing dividend, you also mentioned your plans to prepay some of the debt. Can you give color on that and how much you plan to pay down next year?

We haven't concluded decision at this point yet as to any early redemption amounts yet for next year. We've got $35.5 million of the gold notes currently outstanding. And at current gold prices, we would be using about $52 million that we've raised through the sale of that gold in the market to repay the debt. So we are taking a look for next year as part of our budgets before the end of the year to determine a course of action to potentially go through the process of doing some early redemption. But there's no urgency for it. But we do see it as an opportunity as our cash flow continues to build the balance sheet that it would be a logical return that would favor our shareholders if we did so.

As you pointed out, the cash cost in Segovia did stand out in the quarter. Do you think the rates we see now is kind of the normalized rate for Q4 and 2021 or any chance that it can go down?

Yeah, I think it's sort of normalized again, at this point. The history of working with the contract miner and the artisanal miners has always been one where we know that we are competing with illegal mills that defy material. So with the very significant increase in the gold price, we felt that after keeping costs pretty steady since 2017, it was time to make a change to ensure that we reward them for the higher grade material that they're bringing and we are seeing an improvement in grades from the artisanal miners. And then Lombardo mentioned to me this morning, I mean, we've now got over 50 contracts in place for artisanal mines within the Segovia title. So we'll see some more supply coming from that down the road. And it's I think as I said, we've pretty much stabilized there is a mechanism that above above a certain price we will see the price continue to go up, but we'll also see it come down. So it'll float as the gold moves up and down. So no additional surprise to come as we go forward. It's really just fine tuning in light of this very significant rise in the gold prices this half of the year.

And then the resource drilling programs at Segovia and Marmato, are you planning to update your estimates in Q1 or reach for more drilling?

No, the plan with Segovia to repeat what we've done each of the last few years, we'll update the reserve and the resource and announce that in March next year. At Marmato, we are expecting that we will update both the reserve and the resource with the drilling that we're doing that will come in the first half of next year. And we do expect to see increases in the reserves resources based on the drilling that we're doing at Marmato, which is ongoing. Marmato released some updates earlier this week on the drill program, not only extending the main zone by 300 meters along strike but infield drilling on the new zone and two wildcat holes, testing another zone of demonstrated mineralization. So it continues to grow the more we drill and we're planning to put an update out as I said towards the -- between March and June of next year.

Just one more question then if I can squeeze in. If you can expand on the exploitation or the drill program at Juby next year?

Yes, it's still sort of in early stage where I think we're focused on resource growth at Juby within pit resource that we've reported in early October fell in line with our expectations from the due diligence work. It came down from the original 4 million ounces of global resource only because the new 43-101 rule is required to constrain yourself within pit resources. So we haven't lost any ounces from the old resource, it’s just a more constrained reporting of the ounces. But we're going to continue to follow-up on drilling on Golden Lake where Tahoe had some good conversion of drilling into additional resources from their 2018 work. We're also going to go over and test the Hydro Creek-LaCarte and Big Dome area. There's some interesting information over in that area that it's not really been fully drilled and we plan to get out in the title and do some other reconnaissance work as well. So we've got a fair bit planned for next year but we're still finalizing timing details and we've got to get some exploration permits, which is a couple of months exercise to really get oriented to it right now. So we'll have more detailed news once we've got more concrete plans ready to roll out.

And thank you. I see no further questions in queue. Mr. Davies, do you have any closing remarks?

No, I do have a few questions come in through the web portal. So let me see. Matt Ritzel from Red Cloud wants a little bit more elaboration on the sustainability of the dividend et cetera. Certainly, we feel that the dividend is sustainable at this level. As I said, it's about 10% of our trailing free cash flow over the last 12 months. We can expect that that free cash flow rolling 12 month basis should improve in the fourth quarter with continuation of gold prices at the current levels. And the fact that we essentially are transitioning from paying interest then gold premiums on the gold notes as those are coming down that cash flow is being now directed into funding the return that we're giving our shareholders. So we're very confident that we'll be able to continue at this level and very excited to move it to a monthly basis to allow people to get a paycheck every month. Steve has a question about the drilling campaign objectives. Last year the drilling increased the reserves slightly more than was removed, is the objective to build this up to a 10 year gold mine reserve. I think if our I would say 10-year gold reserve would be something that we'd love to have. But with these high grade narrow vein underground style of mineralization would be very expensive. And what we do believe is that the Segovia title in general is very under explored. There's 27 known veins. We've never tapped into the other 24 where we've got data going back 100 years that demonstrates the historical results from mining and the grades. So we feel this is the time to really fan out and start exploring those other 24 veins in a much more detailed regional drilling…

We would definitely thought that we are getting out out exploration program. We have to -- in the near future means that next year we are going to concentrate our effort, our money in development and infrastructure. We need more infrastructure and where we have very good results in exploration. We have to concentrate our effort in development in vein too. Also the same thing applies for and also the new mine…

I'm so sorry but appear to be breaking up, sir. Is there any way to adjust your microphone?

No. No way. Okay I have no noise around me. Going ahead with this thing. We have a new mine which is we are developing that mine. We are in the planning stage to think we have increased our processing capacity. We are analyzing that and already we are going to do something next year but we will announce that once we have ready for that. Yes, in Segovia we have the potential to increase our processing probably the next stage is going to be from 1,500 to 2,000 tonnes per day but it’s too early to say that. We will announce that once we have ready all the information.

Thanks, Lombardo. I think one of the things that to add to that Lombardo was just commenting to me this morning that 2020 has been our biggest year of development spending in the mines in Segovia in our history and that certainly is going to set us up well for being able to feed our plants and continue at the current level of production as we go forward. So with that, I don't have any questions on the web portal. Is anything else Vanessa on the line?

No, sir. I have no audio questions.

All right. Well again, I'd like to thank all of you for taking the time to join us this morning and be part of the update on Gran Colombia. And if you do have any additional questions or follow up, please feel free to reach out to us. And stay tuned continued announcements on exploration and certainly keep an eye on our Web site for new information and developments as they go forward. Thank you.

And thank you. Ladies and gentlemen, this concludes today's conference. Thank you for participating. You may now disconnect.