Welcome to the TRX Gold Corporation Third Quarter 2025 Results Presentation. [Operator Instructions]. The meeting is being recorded. [Operator Instructions]. I would now like to turn the meeting over to Mr. Stephen Mullowney, Chief Executive Officer. Please go ahead, sir.

Yes. Good morning, and thank you, and welcome, shareholders, to our Q3 2025 corporate presentation and investor call. We have quite a few people on the call today, so that's really good to see. Joining me on the call today is Michael, our CFO. And also in the Tanzanian boardroom, we have Khalaf Rashid and Richard Boffey. Raise your hand guys. How is the weather?

It's nice sunny [indiscernible].

As always, nice sunny. It's warm here in Toronto today as well. I think we got a 32-degree day. So without further ado, I will get into the presentation. And the presentation today will be led by myself with Michael, Khalaf and Richard all chiming in, in the appropriate section. So let's get into it. Today, what I'll do is just give a high-level overview of TRX Gold, as I always do, and then we're going to jump into where we're going in the short to medium term as well as what our Q3 financial results look like. And a high-level summary of the PEA road map and how we see that being played out as well as just finishing it off with the key investment highlights of the company. So TRX Gold, obviously, we're in Tanzania, everybody on the line realizes that. In fiscal 2024, we did over $40 million of revenue and $15 million of EBITDA. We expect those numbers to be higher this year as we continue on and as the strip campaign winds down and we get into the higher-grade portions of the ore body. And we'll get into the results of those operations in a second. One of the major catalysts that we put out in Q3 was our PEA. As we mentioned on our last call, that PEA has a $1.2 billion net present value at around $3,000 on a gold. It's around $750 million after tax on the Buckreef Gold project. It has 62,000 ounces average production for 18 years, at 3,000 tonnes per day of processing capacity. We are currently at 2,000 tonnes per day processing capacity. Our goal will be to improve those metrics over time and hopefully have a larger project than what was envisioned there, both from the existing…

No, I think that was well said, Stephen, nothing further from me.

Okay. Thank you. So with regards to why TRX, where we are today, as Q3 indicates, revenues are growing. Part of that is the gold price. Ounces will start to grow now as well as we get into a higher grade profile. And we're self-funding this growth, and we continue to self-fund the growth. The PEA lays out a straightforward business plan or a road map that we can move along to create value in the Buckreef Main Zone. I went through some of those statistics earlier. So that plan is very scalable. We've done that before, as I mentioned, and we'll continue to move along that road map. And I really like always the blue-sky potential. So the way that the road map can improve is both increasing the plant capacity as well as finding more higher grade ounces in around Stamford Bridge, Anfield and elsewhere on our property. And so we're quite comfortable with that. We do need to get back to the drill bit, and that will be in our budget plans for fiscal 2026. So with that, I'm going to hand it over now to get into the nitty-gritty details. I went through the PEA high level. Mike will start to get into the financial profile and the rest of these slides here, Mike, and I'll hand it over to you for the next 2 or 3 slides, please.

Yes. No problem, Stephen. Good morning, everybody. Thanks for joining us. And you've touched on the PEA, which is really our focus over the next 12, 18 months is focusing on that expansion to really unlock that $1 billion valuation that we put out into the market on that study. But in the meantime, as we talked a little bit about over the last couple of quarters, we had embarked upon a Stage 1 stripping campaign over the first half of the year, to really remove a lot of the overburden and waste that would provide access to higher-grade ore blocks as we got deeper into the pit. And Richard and his team have been managing that very, very closely. And the good news is we're substantially through the lion's share of that strip and have begun to access some of those higher-grade blocks. And consequently, what we're seeing is an increase in both production and sales. And coupled with the leverage that we have to gold price, we're seeing increased financial metrics, both quarter-on-quarter and year-on-year. I'll talk about some of the details here in a minute, but why don't we flip to the next slide, Steve, and we can just touch on some of the specifics. So here's a snapshot on the next slide of a financial overview of the results. And again, as mentioned, it was a strong quarter for the company's financial results. We did see increases in both quarter-on-quarter relative to Q2 and year-on-year in really almost all financial categories from revenue to gross profit to net income, operating cash flow and adjusted EBITDA. We produced just under 4,700 ounces in the quarter, which is substantially more than what we did in Q2. And we continue to benefit from these record gold prices that we're…

Thanks, Michael. I am going to [indiscernible] for a second. One of the things you will notice is we have financed this company through short-term liquidity lines with Stanbic, with an Auramet facility as well as working with our suppliers around payables. So that is all short-term liquidity lines that are funding a long-term asset. And so that -- what that has done in our financial statements has shown a profile. We're comfortable with the way we finance this thing. But at quarter end, you would still see negative working capital. And one of the things that is front and center in our press release as well as in our operations going forward in the real short term is rightsizing that working capital ratio and making sure that it gets above 1. It's above 1 today, and it's continuing to improve. So we're -- we think it's one of the things that holds us back in the market from a financial metrics perspective vis-a-vis other comps, and I'll get into that in a second. But that's certainly a very -- that we're predominantly through the strip campaign and into the higher grades is rightsizing working capital as a short-term goal of ours.

Yes. No, you said it well, Stephen. I mean that's really the last 2 points, and you're seeing the benefit from it in Q4, production has increased. We're up to about 75 ounces a day, which is substantially up from both Q2 and Q3. And in 6 short weeks, we've been able to recapitalize that working capital deficit that we'd incurred through that strip campaign. And as you mentioned, I mean, reduced things like accounts payable by almost $6 million, repaid our short-term borrowings. We've got full access to our liquidity lines. And the focus over the rest of Q4 is to strengthen that liquidity and set us up for execution of the PEA you touched on earlier.

Yes. We have no long-term liabilities besides a couple of leases on long-term equipment. I believe our trucks are paid for now as well, right? So that lease trucks come off as well as -- so we're just left with the excavator long-term leases.

Yes. Why don't we turn to the next slide, if we can, please, where we've talked about this, I think, over the last few quarters. But for folks new to the story, as Stephen touched on earlier, we have expanded 3 times in 3 years successfully. We are operating at 2,000 tonnes a day at full capacity. We did just under 1,500 tonnes a day of throughput in Q3 after some scheduled maintenance and downtime. But with that larger plant, I touched on the economies of scale. You're seeing it come through the processing cost per tonne. But that throughput there is really what's driving the increasing production. It is a bit of a lower grade profile based on where we are in the pit and the strip we've seen to date, but really starting to see the benefits now in Q4 now that we're getting at those higher-grade ore blocks and doing about 75,000 ounces a day that we expect to continue through the end of the year.

Yes. So Mike, one of the things is Khalaf, Richard now available? I know you're in the same row.

Can you hear me, Stephen?

Okay. Yes. We hear you just fine. So one of the things Mike touched on is 3 mill expansions into 3 years. And I know I'm going to get ahead of questions. One of the questions that is bound to come is how we're going to deal with the plant expansion going forward vis- a-vis the PEA and what I'll call what we're currently thinking [ 5,5,5 ] around the initial plant upgrades that you're going to be making in the next 4 to 6 months as well as how we envision building out the plant. Do you want to just give the shareholders just a quick high-level summary of that?

Sure, absolutely. So -- our plant has been upgraded multiple times, and it's now at a target of 2,000 tonnes per day. There are many opportunities to optimize the plant as it is at the moment. And when we see some of the results, we'll notice that there is room for improvement. So in the next 3 or 4 months, we're focusing on just optimizing the current 2,000 tonne per day plant and adding enhancements that are part of the longer-term expansion by modifying the flow sheet in incremental ways. So one of the flow sheet modifications is the addition of a pre-leach thickener that is planned for the expanded plant and getting that in early. That enable us for a lot better control of our leaching process. It will allow us to feed higher grade through the mill as well. And we believe we will improve our overall recovery through that process. The next aspect that we're trying to do in this next 5 or 6 months is put a new absorption desorption recovery plant or ADR plant into the process. That will have the ability to make considerable enhancements to our carbon management process. Our current process is quite manual. We get a lot of breakage, a lot of fines and a lot of gold loss through that damage to carbon. And this new plant will enable us to minimize or eradicate a lot of that and probably give us another 3% or 4% improvement in recovery in that way. Other improvements are through optimizing our mills. We believe we've just embarked on a program of optimizing the power draw. We've noticed we're not drawing enough power through our mills, and we can improve that through, and improved throughput gives us the opportunity to put more charge into the mills and therefore, get a finer grind and more throughput. So some small easy additions to the plant and then some larger items that are part of still a 2,000 tonne per day operation that will improve recoveries substantially from where they are now up to a much higher level. Then the expansion work requires another flow sheet change, which involves a flotation circuit and fine grinding of the sulfide concentrate that we get from that flotation plant. And secondly, a far more simplified comminution or crushing and grinding circuit that is all rated to 3,000 or more tonnes per day. So they are the various steps that we'll be taking over the next 6 12 and 18 months to get that achieved.

Perfect, Richard. Thank you for that. And I think that's a good overview and gives the investors some comfort that it's being well handled. We do need to focus on efficiency. So some of the things that will happen as a result of what Richard just described is higher head grade, as you guys hear, means lower cash cost per tonne, lower processing costs per ounce, sorry. And also, it enables us to -- the power draw will probably enable us to push more tonnes through the plant, which means lower cost per tonne, lower cost per ounce. Those are some of those sort of metrics that are going to improve as we improve the plant here in the next 5 to 6 months. Thank you, Richard. Mike, back to you.

Okay. Why don't we touch on the next slide briefly, Steve. So this slide just kind of reinforces the approach that touched on earlier to how we're running and operating this business. We continue to use organically generated operating cash flow to fund growth. We did reinvest another $5 million of cash flow into the business this quarter. And to date, you can see on the far right box that we've put in over $50 million following an early capital raise in 2021, coupled with almost $40 million of operating cash flow that's been reinvested in this business. So the goal would be to continue to use cash flow to help fund some of the enhancements and growth that Richard just touched on. But what you can see is it is driving increases in things like revenue and EBITDA. And we continue to do it very, very cost effectively. We've got a very, very lean management team and continue to keep a keen focus on things like G&A to make sure our overhead costs are in check. But our approach is being very, very prudent with capital to drive higher profitability.

Yes, Mike, I'm just going to add on G&A there for a second because I do get quite a few questions on the noncontrolling interest number in the financial statements based on the JV. As everybody is aware, we have a joint venture with STAMICO, 55-45. And one of the things is G&A costs, particularly corporate costs come down below Buckreef. And so that's one of the reasons why we are very sensitive to make sure we maintain G&A and very prudent on G&A costs in order to, in the future, hopefully drive higher net profit per share and other financial metrics that the market will look at and that people will do screens. Okay. Next slide. And we don't have Richard. So obviously, we have a comms issue in Tanzania. So I presented this slide in the last presentation and a lot of people liked it. So because it was fairly easy to understand. A couple of things in this slide that are relevant. One is we like purples. We particularly like deep purples in this slide, and here it is that. And so Buckreeef gets better grades as we get deeper. And so what this slide is showing here now is where the mining has occurred up to May 31 and where mining is going to occur the rest of the year. So Richard, this provides us with a -- give the investors a quick sense of where you're going to mine the rest of the year, how that's going to improve the grade profile going to the mill. And also one of the things that we did mention in our press release is a significant increase in the ROM pad and both from tonnes perspective, ounce perspective and grade perspective and how that will change over time.

Sure. Thanks, Stephen. Okay. Well, if we just follow the colors, the warmer colors represent the higher grades. And in the beginning of FY '25, we focused on the right-hand side of that page to much lower grades. We've -- over the last 2 quarters, as we signaled in these meetings, we pushed the strategy to get back to the central and southern part of the main pit, and we've succeeded in doing that last quarter, and we've now accessed these high grades. So we've got not only higher grades, but plentiful ore that we are now accessing by. We're signing -- we've received the benefits of that strip. So the other benefit of that is we've got a much lower strip ratio now going forward for a little while, and that enables us to really grow our stockpiles ahead of the processing plant to the point now where I would suggest we've got about 2 months supply already now of high grade and feed grade ore that's ready to go for processing. And that will continue. We'll be in a very healthy position now until we finish Stage 1 of the pit, which is another 6 or 7 months away. So we've built ourselves into a good, strong position with feed for -- good feed for the plant. And we've also now started the second stage of stripping for Stage 2 of the pit. And we've built up a nice healthy stockpile to see us through a gap of mined ore that will hit us in about 7 or 8 months.

Excellent. Thank you, Richard. So getting on to the next slide, just a brief overview of the PEA. So as Richard just described, the grade profile is improving. There's healthy stockpiles. We're moving through the pit in a very good sequence, which is part of the PEA. And so in that PEA, that sequence continues for 3 to 4 years of open pit mining in various stages. I think there's 3 stages, Richard, for the open pit.

Look, 2 stages in this pit now. We've reduced it from a 3-stage pit to a 2-stage pit and the third stage is really underground. So yes.

Yes. So we're moving through that sequence. And why that's important is because that sequence and the way that it's engineered, goes through the plant expansion, goes through the mining of the higher-grade ore blocks in the open pit part, creates cash flow for the underground expansion and the underground workings in about 3 to 4 years' time. So I won't go through the metrics again of the PEA. They're on the slide here. They're quite obvious. Obviously, it was quite healthy. The key to -- in talking to investors over the last couple of months since we've released this study is one of the things in mining is everybody asks, what's your upfront CapEx? How much do you need to fund in order to execute your business plan? And our comment has always been we got a little queue in the IRR, and we probably should have stepped back a little bit because we get asked that question. So what's your IRR? And we say, well, given that the way the study was put together and it was predominantly self- funding, you don't have an initial CapEx upfront, so you don't have an IRR. It's infinite to a certain degree. But everybody asks, so what are you going to spend over the next 3 to 4 years? And the reality is that spend is around $90 million. The first 2 years of the study is predominantly the plant expansions, and Richard just went through with you on how that would operate. And then the third and fourth year are predominantly the development of underground development to feed the plant for the remainder of the mine life. And this is all within the Buckreef Main zone. It does not include Anfield, where I mentioned before, our best drill hole results are as well as -- sorry, Stamford Bridge as well as Anfield, which also has really good drill hole results. So this is the CapEx profile that's split down between the the plant expansion first and then to the underground workings thereafter. And so everybody asks, so how theoretically when you're operating this business, how much do you need to raise? Because everybody is asking us, okay, when are you going to raise money to do this? And the answer that we have is, right now, we're self-funding. As Mike mentioned, we've invested a lot of money into self-funding. Right now, it's contemplated to continue to be self-funding. And if you look at the projected operating cash flow as well as projected EBITDA and the multiples on the CapEx in the first 4 years, it says that we should be able to do this predominantly being self-funded going forward. So I just wanted to make sure that people understand that and the way that the study was laid out. Mike, anything to add to that because we get a lot of questions around this.

Issues in Canada as well. Apologies. No, I think that was well said. And again, I think that clarifies a lot of the questions we've been getting from folks over the last few weeks since we published the PEA. Thanks for that.

So with regards to -- we put a comparable company analysis. And one of the things that I mentioned earlier of focusing on is if you look at people who have moved up on this curve, they've executed both on ounces, expansions. And importantly, they have what I'll call normalized working capital ratios. And so the short- to medium-term focus for us is to make sure that we're not discounted because of our working capital ratios. And so we will be continually working on paying down some of our payables and capitalizing the business appropriately to make sure that our working capital ratios are in line with market comps that have performed. And also, when I look at the others who have moved up on this curve as well, making sure we have the capital discipline in executing our expansion plans as well as continually growing that business is also extremely important to move up on this curve. So the focus, although we're behind today, hopefully, we can start to catch up when we recapitalize through the -- through increases in production and cost management as well as our expansionary plans. With regards to the capital structure, we did not issue any capital raises in the last quarter or the last couple of years. The stock is still oscillating. As I mentioned, I think a large part of that is you got a $1 billion study in the market. The market wants to see you get there. To get there, one wants to make sure that you have the proper capital to get there. And when we recapitalize in the next couple of quarters, I think we should see -- hopefully start to see some movement on the share price. We also have picked up our marketing campaigns now that…

[Operator Instructions]. And our first question will come from Jake Sekelsky with Alliance Global Partners.

So just starting with throughput during the quarter. We saw a 25% oxide, 75% sulfide mix. Any visibility on how you expect this to trend in the coming quarters?

Yes. So I'm going to answer that, and I'm going to ask Richard to finish my answer. When he said there will be a pre-leach thickener, that is to get to 100% sulfides to have a -- in order to have a better head grade. So currently, what's happening is the oxides are lower grade, but they're needed in order to float carbon appropriately in order to get gold recovery. So this is one of the items that is high on Richard's list. So Richard, you're much more technical than I am. You want to just continue to answer that question.

I think you answered it okay. But in terms of timing, we're looking to get the thickener installed by the end of this calendar year. So we're looking that we'll probably not feed oxides much at all or at such a high percentage going from calendar year 2026 onwards. And yes, that will probably raise our head grade by about 0.3 of a gram, 0.4 of a gram.

And so also, Jacob, really, when you look at the way this is being executed, we have predominantly an oxide plant right now that is being upgraded to a sulfide. And that's part of [indiscernible] count and as part of the flotation and regrind circuit changes that Richard has been explaining.

Okay. That's helpful. And then building on that a bit, just on recoveries. You touched on the finer grind work that's ongoing. Any additional color on what that time line looks like? I mean, are those benefits we might see in the next few quarters? Or is that a program that might take a bit longer?

Maybe I'll jump here on this one. We're working on 2 aspects of grindability. So our current process requires us to get a PAD of about 75 microns. And we have achieved that, but not in a stable fashion. So the more we work on that, we'll see slightly better recoveries. The flotation plant with the associated Fine Grind, HIG or IsaMill will be roughly 12 to 15 months away. But the intent for me is to try and get this in and running by financial year 2027. And then we'll see a big jump in recoveries associated with that.

Yes. So Richard, I think the time lines we take models this stuff sort of out is for recovery rates into the low 80s, those are kind of where we're going to do, what we're doing into the current plant upgrades with the thickeners and the ADR plant. That's the goal there. And then the high 80s, low 90s in sulfides, that's with the flotation and regrind circuits as well as the upfront crushing circuit.

Yes. I agree. So we'll see recovery improvements, stepwise recovery improvements with the -- in about -- by the end of the calendar year and hopefully, some other minor improvements, just operational optimizations ahead of that as well.

Okay. So targeting a step up to the low 80s in the next couple of quarters and then another step to high low 90s over the next 18 months, fair?

Yes. And that's modeled out in the PEA as well that way. The -- what I'll add to that as well, Richard. I think as we get more and more experience with Buckreef, there are different geometric zones that have different recovery rates in them. So the lower grade zones that we were in at the beginning of the year, have lower recoveries, lower grade and lower recoveries than the current zone that we're currently in. Do you want to just give a quick overview, a snapshot of that, Richard, because that's important [indiscernible] at Buckreef.

Yes, sure. So yes, look, we're doing a lot of metallurgical test work. Part of that is on the current ore that we have at the moment and part of that is the ore that's going to be with us for underground, and we're looking at things from a geometallurgical perspective, from a flotation perspective, from a grindability perspective. So all that work is ongoing. We've already found out some very interesting attributes of the ore body, and we've kind of split the ore body into 2 geometallurgical domains, and we know that we've got to take slightly different approaches to the processing of those 2. But check. It's -- we have to mine it all. It's all economic. We just have to optimize our plant to accordingly.

Yes. And I was just going to say, I mean, Richard, maybe you could briefly comment that we've got the results of the geometallurgic study that have sort of given us a road map to follow to deal with some of these more complex geometallurgic zones, coupled with a comminution study that has given us a road map for the improved flow sheet, right?

That's right. And as I said, there are small optimizations we can do additional to the flotation circuit. Just running some pure oxygen and some over the first tank of the CIL tank will probably give us another small kick in these sorts of things. So -- and it's more effective on one geometallurgical domain than the other. So yes, there's a lot of fine-tuning that we need to do. It's a young plant, and we're finding our way through it to get the best results.

Next question will come from Mike Niehuser with ROTH Capital Partners.

Stephen, can you hear me okay?

Yes, I can hear you just fine, Mike.

I'm heartened by Richard's comments about optimizing the plant, really do it in several ways. And it seems like it's perfectly timed with the transition from oxide through the -- towards the sulfides. My question is, it sounds like you're pretty much wheels up with the pushback of this pit to proceed down the path of the PEA by continuing production, generating cash flow and completing the steps of being able to do a flotation circuit and get underground. So really, it seems like you're just going to feather right into that. Am I seeing that correctly?

Correct.

Simple answer. That's good. I don't want a lot of showtime here. The other question is there's a lot of surface material around the project to be oxidized. How do you see -- is that going to be -- take a backseat to the sulfides in underground? Or is there a way to avail yourself of that with the existing plant that could take advantage of the market and such?

Yes. So you saw Richard smile on that when you asked that question. Look, we're constantly assessing oxides around the property. And the part of that is increasing the exploration spend, which I did mention that we will need to put into the fiscal 2026 budget. And any time you have more oxides, there's a trade-off between here and the way that we look at this is -- if we have below 1 gram a tonne oxides and you have 2.5 gram a tonne sulfides, well, once these plant optimizations are done, you're going to put 2.5 gram a tonne sulfides through, right? So there's a trade-off between the 2. But certainly, you can get some really good high-grade oxides, you're going to put them through because they're helpful. And they'll go through any plant. They'll go through the expanded plant as well as long as it's not too much clay in it. Prominent oxide material in Buckreef something that just clay in it. Did I get that right, Richard?

Well, yes and no. I think Mike is asking us if we've got plans to maybe punch another 10,000 or 20,000 ounces out by just having a little plant for oxide. And whilst we don't, the potential is definitely there. And we've even got old tailings that can be economically reprocessed at $3,000 an ounce. So we've got lots of opportunities. We're focusing very much on the PEA aspect, but there are other business improvement opportunities all over this project.

Well, those were both actually very good answers, and I appreciate them both. One suggestion is that with us being in the fourth quarter and the time it takes to publish year-end results, I think the investors would be quite hungry to see ongoing operating results on a one-off basis. So I encourage you to do that. I think this is the time to break the pattern a little bit and take a victory lap if you can. So that's all I got.

You must talk to our Board members, Mike, but that....

No, no. Just staying the obvious, Stephen.

The next question will come from Heiko Ihle with H.C. Wainwright.

I assume you can hear me okay?

We can hear you just fine. I also got your note as well, Heiko, on your questions.

Excellent. In your PEA -- so I guess you got fair warning what I'm about to ask you. In your PEA, you're calling for annual production of 62,000 ounces of gold per year. Obviously, current gold price environment is ridiculously strong, and we may actually see some more increases given all the inflation that's going on. Let's assume for a second, money was not really much of a concern. What would be the main bottlenecks to this figure even more over the next couple of years?

So I'll let Richard answer that question more technical in a second, but I'll give you a sense of the way that we looked at this. So when we first engaged into putting together the study is the bottleneck right now is plant capacity in the study, the major bottleneck of 3,000 tonnes per day, which can go larger. But then when you do that, you have to go and do all your underground workings and engineer all of those. And you have so many ramps and these sort of things that go into that. And it takes a lot of time to do that sort of work. And so when we looked at the study, we said the same thing you said, 18-year mine life, too long, 62,000 ounces can be higher. Most studies that you see are in the range of 8 to 12 years of mine life. How do we get there? And then when we spoke to the engineers around that, it would have taken a couple of more months in order to engineer that appropriately. And we said these numbers are great anyway. So let's get this into the market to show investors how good just the Buckreef Main Zone can be. So Richard, you can get a little bit more technical in and around how -- why it takes so long to do underground work in engineering.

I don't need to go into that sort of detail. I mean the bottleneck is like any good plant at the mill. Our crushing circuit would need a significant upgrade as well just to increase throughput. The new flow sheet calls for a SAG mill and what I would plan to do is make sure that our SAG mill has extra capacity to realize a higher throughput than 3,000 tonnes a day. So don't make that the bottleneck or at least maximize that to its maximum capacity and overperform. When we get to underground, getting 3,000 tonne a day out of essentially 2 declines is not impossible. Getting 3 declines, however, is quite easily achievable and up scalable. So we are looking at the potential for us to put an extra decline down. And our studies are based on 50-tonne trucks. We could look at 60-tonne trucks, for example. We've got other -- we did a haulage and hoisting trade-off study, and they all -- you could throw a blanket over them. So even a small shaft could be considered as a viable option and then you can really start talking about 4,000 tonnes a day. So plenty of upscope potential there, but optimization studies would be required. And as Stephen said, we wanted to get out to the market with a, I guess, a vanilla flavored technical approach to it, and I think it's a good base case.

Fair enough. And then just a follow-up, and maybe I'm just not grasping something here. But I mean, your deal with the Bank of Tanzania, you're going from a 7.3% royalty to a 4% royalty. So that changes 3.3% of what you're getting. So about $100 an ounce, real meaningful. It also states that you're selling it to BOT at the market rates. So if you could scale this, and it sure sounds like you could because the 20% seems to be your words a minimum, why wouldn't you just go to the maximum or 100%? Is there credit risk? What's the downside from this agreement to you? I'm just -- I guess I am not....

Great question. So we just got into this agreement, Heiko. And I'm going to let Mike get into the nuances of because there's another question in the queue around this is, look, when we engaged on this, we had certain factors. And the way the agreement is set up is essentially, we're selling assay Doré to the Bank of Tanzania from the gold room and get paid instantaneously, although we get paid in market exchange rates and shillings. And we have a -- our cost base is predominantly in shillings as well. So yes, no, it is a really good transaction. We work quite extensively with the Tanzanian government to get it to this point. The Tanzanian, Bank of Tanzania, not unlike a lot of central banks in the world wants to grow their gold reserves. And this is a good way for them to do it. We sell 20%, Barrick sells 20%, Geita sells 20%, Shanta sells 20%. I would predict right now, the biggest bottleneck is the refining capacity in country. So Mike, do you want to get into that a little bit?

Yes. No, you said it well, and you read it right, Heiko, for sure. I mean it is a minimum. So we've got an opportunity to sell as much over and above that as we deem appropriate. We are paid in shillings, though, to Stephen's point, we do have things like overhead costs and others that are U.S. dollar-denominated. So there is a bit of U.S. dollar exposure that we would continue to be paid and require that. But there is an opportunity to ship more gold to the local refiner and sell to the Bank of Tanzania and take advantage of that royalty. Because they're only now kind of getting up and running as far as what they can refine, there is a capacity constraint Heiko that Stephen mentioned. They are trying to figure out how to refine our gold, Barrick's Gold, Anglo's Gold, Shanta's Gold, and do it efficiently and effectively. And right now, I've asked that we perhaps be a little bit patient with them in terms of what we ship them. And as they get more efficient in their process, we could certainly look at increasing what we send them and what we sell to them and take advantage of that reduced royalty rate.

Yes. So Mike, I'm just going to poke in before Heiko ask another question because it leads into the text question. Please explain the foreign exchange rate between the Tanzanian shilling and the U.S. dollar for gold as it pertains to TRX's agreement with the BOT. So I want to explain to you how you manage that through the team in Tanzania.

Yes. No, it's a good question. So as Heiko, you touched on and a good question on the FX as well, both the gold price that they quote as well as the foreign exchange rate that they quote on each transaction are daily international published rates. So the FX is published on a daily basis. It's at about KES 2,600 to USD 1, for every USD 1, it's KES 2,600. And again, what we validate both the gold price and FX rates that the Mining Commission quotes with each shipment are against internationally published rates in London and abroad. So all market rates and again, published on a daily basis on the Mining Commission website that folks can track. And again, Stephen mentioned it, the goal in part by some of this local benefication is to help prop up those foreign currency, exchange reserves. The currency has depreciated candidly in the last number of years. So it's just an opportunity for them to bolster the currency, and it's improved from about, I want to say KES 2,750 to $1 to about KES 2,600 to $1 currently, which I think is in part due to the approach they're taking with local gold sales.

All right, Heiko, any other questions?

No, that was it on my end.

So I'll get into another question that -- operator, is anybody else in the queue?

No, sir, you're free to take the floor.

Okay. Excellent. So the last question is an interesting one. Gentlemen, all fair and good. But how do investors make a return? We are in the early stages of a gold bull market, and I'm seeing a number of small juniors that are not even in production, that have a good price appreciation yet TRX stock has not appreciated to the same degree. Look, I did -- so I'll get into what I think is necessary and what the team thinks is necessary. And I did get into this in the presentation. I think you have $1 billion study in a good road map, that's great, but you need to get there. As you're hearing on this call, we are getting there. We are making steps to start to realize that. But I think the market is going to need to see us continue down that path as well as become properly capitalized. As I mentioned in the comp charts, more better capitalized companies have had better returns. And I've seen that, and we see that in the analysis that we do. So what I would do is I would ask the gentleman that asked that question is look at those juniors that are -- have appreciated and look at their working capital ratios as well as their cash balances. And I believe what you will see is ones with higher cash balances have appreciated more than ones with lower cash balances. Ones that don't have debt have appreciated more than ones that have significant debt. So I think there's still a working capital element to this market. The second part to that question is the joint venture agreement. I think the market still has some uncertainty. We have a 55%, 45% joint venture agreement, which isn't as favorable as other jurisdictions or other people, even in country. And I think we need to work through that with the Tanzanians and help them understand that what's good for us is also good for them and move that forward. So I think those are the 2 major things that have impacted share price appreciation to date. Also, I'll add a third one. When we did come in, and I've explained this a lot of times to people is it was very undercapitalized even when I came in, we only had $2 million of cash. In order to do what we've done, we had to do early capital raises. There weren't a lot of sources of capital at that point in time. We do have a warrant book that's still there, that starts to expire in the new year. And I think as we move through that warrant book and those warrant expiries, we should start to see some share price appreciation. So anybody who understands trading understands what I'm talking about. I'm happy to take more questions around that. Hopefully, that answers the question. And in the fulsomeness of the question, it's certainly something on our minds. Operator?

Yes, sir. We do not have any other audio questions. So you're free to take the floor for closing remarks or if you have additional tech questions.

So thanks, everyone, for joining the call today. Greatly appreciate it. Thank you for the questions. I hope you get a good sense that we are moving forward. This does take a little bit of time, but we do have the proper team to move this asset forward. We've proven that in the past. We are proving that in the future. The short- to medium-term focus is going to be on, as I mentioned several times, normalizing the working capital, continually the plant expansion, continue the mining in the underground, the PEA route, get back to the drill bit in the new year, put that into our budgets to expand resources as well as continue negotiating and having good conversations around the joint venture agreement with the government team. Quite straightforward now, no longer as complicated as it used to be 2 years ago. So it's a straightforward road map to value creation. Thank you.

This brings a close to today's meeting. You may now disconnect. Thank you for your participation, and have a pleasant day.