Good day, and welcome to the Ramaco Resources Third Quarter 2025 Results Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Jeremy Sussman, Chief Financial Officer. Please go ahead.

Thank you. On behalf of Ramaco Resources, I'd like to welcome all of you to our third quarter 2025 earnings conference call. With me this morning is Randy Atkins, our Chairman and CEO; Chris Blanchard, our EVP for Mine Planning and Development, and Mike Woloschuk, our EVP for Critical Mineral Operations. Before we start, I'd like to share our normal cautionary statement. Certain items discussed on today's call constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent Ramaco's expectations concerning future events. These statements are subject to risks, uncertainties and other factors, many of which are outside of Ramaco's control, which could cause actual results to differ materially from the results discussed in the forward-looking statements. Any forward-looking statements speaks only as of the date on which it is made, and except as required by law, Ramaco does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. I'd also like to remind you that you can find a reconciliation of the non-GAAP financial measures that we plan to discuss today in our press release, which can be viewed on our website at www.ramacoresources.com. Lastly, I'd encourage everyone on this call to go on to our website and download today's investor presentation. With that said, let me introduce our Chairman and CEO, Randy Atkins.

Thanks, Jeremy. First, I want to thank everyone for being with us this morning. Again, we've got a lot to unpack today. We had another exceptionally busy quarter on the rare earth front and somewhat of a continuation of last quarter's results on met coal. Since our rare earth transition has grabbed most of the attention, we will start there. Both myself and later, Mike Woloschuk, our Head of Critical Minerals are going to go through a number of updates on various developments since our last call. After our July groundbreaking with Secretary of Energy, Wright, we have moved to rapidly capitalize on this momentum to derisk our future execution as we move forward on this unique corporate transformation. Here is a short breakdown of where we are headed as we build out this vertically integrated and mine mouth critical minerals platform. First, of course, we start with our large deposits. That is what frankly provides us all the optionality. We believe we will have the largest upstream production platform in the U.S. for heavy magnetic rare earth as well as the 3 critical minerals we possess, which are gallium, germanium, and scandium. On the midstream front, following an optimization at our pilot plant, which is now under construction, we intend to build a large commercial oxide separation and processing facility. It will be large enough to have refining capacity for not only our own coal-based feedstock but also to hopefully process third-party feedstock should that be an attractive accretive proposition. This is the concept of developing somewhat of a regional or perhaps even national processing hub. We intend to try and keep optionality on the size of the plant, dependent, of course, on market dynamics as we get further along. And lastly, on our downstream operations, we just announced…

Thank you, Randy. There has been a ramp-up in third quarter activities, and I would like to highlight some of them. Firstly, we hired Martin van Wyk as Senior Vice President of Critical Minerals Processing. Martin joined us from Fluor Australia, where he was the global subject matter expert for rare earths. He has over 20 years of experience in mineral processing, hydrometallurgy and rare earth element flow sheet development. He holds a Master of Chemical Engineering and a Post-Graduate Certificate in Corrosion Engineering from Curtain University in Perth, Australia as well as a Bachelor of Metallurgical Engineering from the University of Pretoria in South Africa. We anticipate his relocation to the U.S. with his family in early 2026. On September 4, we awarded the Brook Mine pre-feasibility study to Hatch. As Randy mentioned, Hatch has a world-class expertise in rare earths and critical minerals hydrometallurgical flow sheet development. Hatch's scope includes the development and management of the metallurgical test work programs to support the pre-feasibility study as well as process flow sheet optimization and pilot plant design. The final PFS report is scheduled to be completed in April. We also awarded the metallurgical test work programs to 2 commercial laboratories, ElementUSA and SGS Lakefield. Both of these labs are known to Ramaco, and they come with extensive experience developing rare earths and critical minerals, hydrometallurgical flow sheets. We are executing test work in parallel to accelerate the optimization of the flow sheet. We also completed umbrella agreements and task statements for the U.S. Department of Energy National Labs to execute test work scope there when they return from the government shutdown. Also in late September, we published an updated S-K 1300 compliant technical report, which included an inferred resource estimate for the currently permitted area. The results of this…

Thank you, Mike. Starting with the balance sheet. I'm pleased to note that we had record liquidity of $272 million at the end of Q3. This is the strongest level of liquidity that we've ever had. Liquidity was up over 237% compared to the same period of 2024. We ended the quarter with a net cash position of $77 million. During the third quarter, we issued $200 million of common stock underwritten by Morgan Stanley and Goldman Sachs. In addition, we announced the redemption of the $34.5 million 2026 senior notes at 9% and the issuance of $65 million of 2030 senior notes at 8.25%. As noted, focusing on our core met coal business, our third quarter 2025 operational results were again solid with cash cost per ton of $97. This continues to put Ramaco in the first quartile of the U.S. cash cost curve. Cash cost per ton sold fell $6 from the second quarter on stronger overall productivity. As we head into Q4, our mine costs continue to have dropped throughout October. We would note that November and December are holiday months, which will have some impact on costs. Our Q3 production fell modestly from the second quarter to 945,000 tons. This was the result of both the typical July 4 minor vacation as well as our continued focus on value over volume. As Randy noted, we would rather leave production in the ground versus selling it at a loss into the spot market. Thankfully, our strong balance sheet, including our record liquidity position, allows us this flexibility. Overall tons sold fell to roughly 900,000 in Q3 from roughly 1.1 million tons in Q2. This was largely due to the fact that some shipments originally scheduled for July ended up shipping in the back end of June, coupled…

Thank you, Jeremy, and good morning to everybody who is with us today. Following some of Mike's earlier comments, I'll start with some of the ongoing work on the ground at the Brook complex since our last call. At our pilot plant location, the geotechnical drilling commenced and was completed during the month of September and the subsequent engineering report to allow our foundation design was completed just in the last weeks. In parallel with this, we have also obtained all local zoning permits to begin construction and site the pilot plant. We broke ground on the facility last week, as Randy mentioned, and we expect to get the actual foundation work begun in November. We expect to have the building under roof early in 2026 to receive delivery of the first pilot plant modules from Zeton. As Mike mentioned, in this facility, we will also house our own analytical testing laboratory. Chief among those components will be 2 ICPMS machines, which have been ordered and will accelerate the testing of our ore for rare earth elements and critical minerals. At the Brook Mine itself, as Randy mentioned, we moved a large amount of coal rock and ore during the initial months of operation. To be more granular on some of this, we mined and isolated approximately 300 tons of high-grade REE critical mineral ore for further bench testing and pilot testing, both on-site and off-site. All of this material was located in one band of strata between our Dietz Seam and our Monarch Seam. We have already sent bulk samples, approximately 500 kilograms each to the national labs as well as third-party commercial labs for continued flow sheet optimization and testing. To put the amount of stockpiled high-grade ore in perspective, we anticipate our pilot plant once on site…

[Operator Instructions] Our first question comes from Ben Kallo with Baird.

Thank you for all the detail. Just a big picture, lots of talks about deals with the United States and our allies, could you maybe kind of give your viewpoint on that? And then how that impacts any kind of support that you give to the United States government for your development? And then I have a follow-up, too.

Well, I think in the political arena, when the U.S. starts making deals with foreign countries that obviously has macro political implications. As far as the supply implications, I think it remains to be seen specifically what type of supply that those countries will be supplying to the U.S. So I think the jury is still out. I'll let Mike maybe comment on that because he's probably much more familiar with some of the operational aspects of some of the countries over there. As far as it has to do with the U.S. and what it will do or not do with trying to support its own domestic industry over here. I think the government is moving forward on various fronts to try to be as supportive as they can, as we've seen over the last several months. But Mike, please go ahead and comment on that.

Yes. Look, my view on this is that these are short-term agreements. Until the U.S. ramps up domestic supply of these critical minerals. There's a need perhaps to close the window in the short term. But I think given the application of what these critical minerals are used for, that there will be domestic supply in the U.S., and this is really a short-term solution.

My follow-up is just about extracting rare earth from coal. Can you talk about what you've done and what you -- still need to be done to derisk that process and that it's been done elsewhere? Or just give us some thoughts around that.

Sure. I think some of the industry thinks we're extracting coal from -- rare earths from fly ash, we're not doing that. We spent a good part of a calendar year testing various processes and metallurgical flow sheets to achieve one main objective, and that is to solubilize all of the high-value critical minerals. So we are -- our process plant is basically taking the plays and the shales that are intermingled with coal, and we're extracting the rare earths from those. Once soluble, the flow sheet is less risk in terms of purification and separation because there's technologies out there and examples and commercial applications that do that. So my view is that the high-risk part of this flow sheet was proving that we can extract the minerals which we've done. So currently, in the pre-feasibility study. We're spending more time on that downstream purification, looking at options, for instance, do we look -- do we use precipitation, ion exchange. We're concentrating our rare earths and critical minerals for further downstream processing and optimization. So like in every project as we advance through the engineering studies, where we're looking for more engineering design definition and optimization.

Yes. I'll make one other comment, which is what that we've said before, but probably merits saying again, so coal is essentially an unconventional source of rare earth. It's unconventional in a number of capacities, one of which, of course, is most rare earths are found in hard mineral. So coal is much easier to mine. It's a much softer material to process as well. And of course, from a processing and mining standpoint, it is not radioactive. So most of the other hard rock minerals have radioactive tailings, which has to be dealt with, both in terms of the mining, the waste side of that after the mining has been done as well as, obviously, through the processing. So coal is a much more benign feedstock to work with.

Our next question comes from Colin Rusch with Oppenheimer.

Could you talk about how modular your plans are for the processing facilities and how we could think about some of this capacity coming online? Is it possible that you could start ramping some of this capacity a little bit earlier as you ramp up certain segments of the facility?

Yes. Look, we are -- and I think we've announced the acceleration. What I spoke about today is we're conducting test work programs in parallel. So we have 2 commercial labs working on this flow sheet optimization as well as the U.S. government labs when they get back to work. We intend to have testing being conducted at 3 facilities. I think in terms of ramp-up, we've talked about that. We have some optionality with ramp up, whether that's staging to meet the demand. But I think in terms of what we need to achieve first is confirmation of the flow sheet, early engagement with technology providers, and we are having some of those conversations now to make sure that they advance the engineering with us and identification of long lead items, which Hatch is working on now so that we can place equipment orders early. I think the fact that we're permitted gives us some advantage because we can get into this site to do some early site works versus projects that are still waiting for permits. So all of those factors are going to help us ramp up more quickly.

And then just given some of the substantial value that is coming from the facility or coming from the site through scandium, can you talk about how mature those conversations are? Any sort of issues around pricing, either higher or lower that you see potentially impacting some of these estimates as some of the incremental capacity comes online? I think some folks may get a little concerned that you start impacting some of broader market prices, but that may not be the case. Just want to get a sense of how substantial those conversations are and some of the impact around some of the...

Sure. We're not going to get too far -- yes, we're not going to get too far under the weeds in terms of discussions about negotiations that are taking place in real time. I will say that we are having discussions with both domestic and international customers as it relates to scandium. We've not gotten to price specifics at this point. But as I mentioned, the last, frankly, major price marker was the one that the U.S. government established with their deal with Rio here a couple of weeks ago. And in terms of negotiations, we obviously don't negotiate in public like anyone else does. And once we get to a point where we have actually agreement on any points, then obviously, that will be disclosed.

Our next question comes from Matthew Key with Texas Capital.

Staying on kind of the rare earth side. We've seen some other coal companies hit at the potential for rare earth development in the PRB. Could you maybe share some color on why you view Brook as unique compared to other PRB assets? And kind of what's the major differentiator there in your view?

Sure. I'll give you basically what we have been told by NETL which did a national assessment of rare earth sites, frankly, all over the country and specifically in the Powder River Basin. So in the Powder River Basin, of course, there are areas where there is REE concentrations. The unique thing about the Brook site is that we are, frankly, on the far western edge almost the edge itself of the Powder River Basin. To our West is where there was a great deal of volcanic activity, millions of years ago, which we benefited by having that volcanic ash rain down on our site. And we also had similarly a lot of deposits of rare earth that frankly were co-mingled with the alluvial seas, and they permeated up through the crust on to our site. The comment that was made to us by NETL was that you might go just a few miles from where we are, and we have a -- we probably have about a 7 or 8-mile site and you might not find anything. Indeed, when we've mined, you can go and find high concentrations and then go probably 10 to 15 feet away and you don't hit any. So we can't really comment on what somebody else's site might or might not have, but we have been led to believe that we have a particularly unique site with some geological anomalies that might not be repeatable elsewhere.

Got it. That's super helpful context. And staying on Brook, I was curious in regards to the Strategic Critical Minerals Terminal, is that expected to add a material amount of CapEx to the overall project? Or should it be relatively small?

It should be relatively small. And certainly, the overall context, the big spend, of course, is going to be on our commercial oxide plant. But I think it does add a very unique dimension because it allows us to control some of the downstream. We will sort of be a unique site there where we can act as sort of certainly, as I said, either regional or a national hub to stockpile rare earth for whether they are public or private uses and it gives us some price visibility on what we're doing and also allows us to put our own feedstock and oxides into the stockpile to be able to have some form of controlled marketing as well as some finance opportunities.

Our next question comes from Nick Giles with B. Riley Securities.

My first question, I just wanted to follow up. To better understand the rationale behind the Strategic Critical Minerals Terminal, what kind of economics will be third-party receiving? And I guess my question is, why not sell directly to customers with a smaller footprint for potentially more attractive economics?

I'm not sure I understood your second question. But I mean the first question, what our customers receive, basically, we will be able to have sort of a clearing house, think of it more in the context like a regional petroleum hub where you can basically market from that site to third parties in a controlled manner, which provides some optionality both for other producers as well as for ourselves. And in terms of the overall economics, I think it will be a net benefit. It's obviously not going to be a heavy CapEx requirement for us, but it does provide us some visibility into the market that we might not otherwise have.

My second question was, you announced the pilot plant oxide facility the day and -- or the groundbreaking at least. And the target is to be operational by mid-'26 and then you expect to operate it for a 6-month period. I believe that's fairly accelerated relative to other pilot facilities across the space. So my question is what ultimately gives you the confidence that you'll be able to fine-tune and validate the processing techniques on this time line?

We get into -- I'll let Mike get into some of the technical aspects. But as I said earlier, what we're trying to do is kind of fast track it by first of all, while we're actually constructing a facility to build the pilot plant in. We are going to have that basic engineering design and testing done off-site at a spot that's already got all of the equipment, infrastructure and testing facilities to do that in real time for a period of months, maybe as long as 6 months before we even have to get our own site positioned to basically have all that material moved into it. So we'll accelerate that from that standpoint. That's the Zeton arrangement. But Mike, go ahead and touch on some other aspects here.

Yes. I think it's worth mentioning. I mean we've been designing the pilot plant now for a couple of months. So although we've just announced where we're at, there's been -- Hatch has been involved with us putting together a basic engineering package. So we've got the mass balances, the flow sheet. We've sized the equipment. We've handed over a detailed engineering package to Zeton. So this is well underway. We know what equipment -- the sizing where we're going to source them. Chris mentioned, we came to a 3 ton per day of ore throughput to the pilot plant. We picked Zeton because this is their wheelhouse. They design and build these plants. They have technical skills in-house that can fabricate vessels if they need to be custom designed for instance. So we're not sending things to third parties to get fabricated I think the other thing to mention is Zeton was involved with them more than 20 years ago on a very complicated pilot plant also. In terms of your -- answering your question about ramp-up. Frankly, we've got Hatch who's got several subject matter experts in rare earths in the Americas. We brought Martin on board which -- coming from Fluor, we -- there were similar unit operations with separation purification. So we have some knowledge in-house about what we're going to do with the design to help us get ramped up. The 6-month operation period is really to generate product that's going to be quality spec for our off-takers but that pilot plant is going to be an asset that we're going to continue to run for years ahead as needed and testing and continually optimizing like other facilities when they have pilot plants on site, it's really an asset for the company long term.

I'd just like to add, I think we are doing a lot of stuff behind the scenes that we're not exactly announcing on a daily basis. We have been at this now for about, I guess, going on our seventh year. So the amount of behind-the-scenes work is a lot more substantial than I think might meet the eye.

Our next question comes from Nathan Martin with Benchmark.

Thanks, operator. A lot of information discussed already. I guess maybe at a high level, what do you guys need to see from the pilot plant process, customer conversations, et cetera, to make you feel comfortable enough to move forward with full commercialization? And do you still expect to make that decision by the end of next year, possibly?

Sure. I'll make a comment on the high level probably from a financial and strategic standpoint. I'll let Mike comment from a high level on the technical side. So obviously, as a normal development project, particularly in a new business line. We're going to want to see confirmation of customer acceptance of our product, appropriate pricing for our product and appropriate contracts, hopefully, on a long-term basis to establish the underlying predicate to do normal forms of finance. This is not going to be an inexpensive project. We know that. It's a critically important project, not only of course for Ramaco, but frankly, we feel for the country. And so we will take all deliberate steps. We are not gunslingers. We are not promoters in the sense that we're trying to get out in front of markets that aren't there. But I think we will be deploying the same sort of careful discipline that we have used in our met coal business to ensure that we've got a market for the product that we will build. And we will finance it conservatively, and we will try to make sure that operates efficiently and at low cost. So Mike, I'll let you pick up from there.

Sure. I think the purpose of piloting is twofold. It's prudent for us to provide confidence that we have a flow sheet that works, and we can produce product on spec for our off-takers. There's plenty of projects, commercial plants that are built without piloting. But given we have an unconventional deposit, it provides people with confidence that technically our flow sheet works and that we can achieve the product spec. So that's really what I'm aiming to achieve is on the technical validation, and that's why we're piloting.

I appreciate those comments, guys. And then maybe just one question on the met coal side of the house, updated full year sales guidance, looks like it assumes about 900,000 to 1.2 million tons shipped in the fourth quarter. It looks like 3.9 million tons committed, I believe. So where do you think you ultimately kind of end up within that range? What could be some puts and takes there?

Nate, so I mean I think as Randy said and Chris said as well, the mines are running great. But obviously, we've continued to sort of rationalize production because we're just not going to sell at a loss into the spot market. So certainly, we've got inventory on the ground and the ability to hit the high end of the range, but kind of similar to Q3, where you saw us obviously come in a little bit more towards the lower end of the range on shipments. We will monitor the market and sort of see where things shake out. So I would say probably the vast majority of the range is just candidly market driven.

Yes. I'd say Nate, one of the things we always find in the fourth quarter is that at least for the last couple of years, a lot of the domestic steel guys have frankly, underbought as they go into their original contract procurement and you get to the fourth quarter and they need to play catch up. This is perhaps particularly true in a year where there is a supply rationalization. So as you well know, we've seen a number of suppliers in the market cut back or frankly, go under. So I think it's going to be interesting how the fourth quarter plays out.

Our next question comes from Alex Fuhrman with Lucid Capital Markets.

You have a really diverse portfolio of critical metals at the Brook Mine. Is the pilot prototype that you're building in Ontario, is that designed to process the entire range of minerals that you have? Or is it possible that you're going to need some additional partnerships to process some of the less common metals? Would love to get some more color on that.

Yes. We aren't anticipating any partners. I think there has been some conversations recently about -- is there -- is there an opportunity to pull something else out of this mix. You're right. It's a very unique basket. There's been interest in yttrium, potential samarium and others. Gadolinium has been mentioned. So I think the beauty of a pilot plant is there is some flexibility in being able to test other things. So we are designing with that in mind that we have flexibility with the pilot plant. That if we want to bolt something on to test or to validate that we have the opportunity to do that.

Our next question comes from Jeff Grampp with Northland Capital Markets.

I wanted to talk on the permitting side of things. Can you guys give us a sense of the time line to get the remainder of the mine permitted to handle the increased throughput plans you guys have talked about?

We will be -- we are already meeting with some of the federal groups on permitting. We've had ongoing dialogue, of course, at the state level. We just received our next 5-year renewal on our original mine permit, which frankly lets us continue to do everything we want to do without further amendment. What we're developing right now, and I'll maybe let Chris speak just a little bit to it, but we are developing our mine plans as it relates to the balance of our 16,000 acre site. Of course, the original mine plans only cover about 1/3 of that or less. And once those plans are developed, then we will proceed probably on somewhat of a combination of both a federal and state expanded permitting. So Chris, you might want to just talk a little bit about your mine planning.

Yes, just to add a little bit of color to what Randy said. We already have the permitted areas, a huge area. It's about a 30-year mine plan at the base rate. So we have the ability to deploy 2 or 3 fleets for the size that we ultimately choose to mine at Brook within the permitted area. So that will require minor modifications to the permit as far as the staging of the mine, but not actually having to have the entire property permitted on day 1. So we've got a lot of runway in front of us. We are drilling all the testing wells that are required for water outside that permit area and quite frankly, to go deeper as well. But with the amount of area that we have at Brook, that's not even a start-up concern on the initial mine permit.

Yes. I mean the one thing I'd point out, just given the frankly, massive size of the deposit, depending upon the sort of velocity of our mining. We've got, on one end, probably north of 150 year mine life. If we want to accelerate the mining, obviously, that number goes down, depending on how quickly we intend to mine on an annualized basis, but we have more than enough to say grace over at the moment. And the interesting from a permitting standpoint, I would add also one other aspect. We have only, frankly, tested, as I've said before, on a sort of conventional Powder River surface mine program where we have core drilled down to about 150, 200 feet. We have discovered or, frankly, NETL helped us discover that we have deposits that frankly are much deeper. We have done some cores now that have found, frankly, much higher concentrations down in about the 500 to 600-foot levels in some of our areas of the site. So in addition to what we've got, at the surface. We've also got potentially a very large sort of untapped and unexplored area in a much more subterranean area, which might lend itself to a different kind of mining. We've talked about before the notion that we could do some form of in-situ injection well mining for some of the deep stuff which will probably encompass another type of permitting exercise. But it just shows how big this deposit really is.

That's really interesting. Just a quick follow-up. Randy, you mentioned being on a lookout for some opportunistic bolt-on acquisitions. Can you just shed a little light on what kind of opportunities you guys are looking for and how you characterize the overall attractiveness of the acquisition market?

Yes. I mean when we get asked about M&A opportunities, I always quip, we're not particularly interested in the M, but we'll take a look at the A. So we have kind of had a program of the past of picking up somewhat opportunistically assets, be they reserves or infrastructure in the coal space that are accretive to us and that we're able to pick up on an advantage basis based on perhaps market distress that others might have. And frankly, we've -- we're looking at some of those now. We've also made a small acquisition out, frankly, in the Brook Mine area where we bought about 1,200 acres of surface property on top of what we already own, which is going to provide us a lot of optionality for some of the planning for where we might want to site some of the industrial areas out there. So we're always on the lookout, but we're kind of a rather opportunistic buyer.

This concludes our question-and-answer session. I would like to turn the conference back over to Randall Atkins, Chairman and CEO.

Well, I'd just like to thank everybody for being on the line today. I realize this was a little bit longer than our normal quarterly call. But as we move forward, we're basically giving a rundown on 2 separate operations, both of which are very important. So we appreciate you bearing with us. And we'll certainly look forward to keeping everybody apprised as we move forward, and we'll look forward to our next call after the end of the year. Take care.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.