Question-and-Answer Session
Operator
(Operator Instructions). All right. Our first question comes from the line of Victor Flores with HSBC. Your line is open.
Victor Flores – HSBC Securities
Yeah, thanks. Hi Tony. Help me out a bit with this provisional pricing situation at Robinson there, is this situation where they paid you based on the royalty rate and then based on their contracts with the smelters they've had to pay money back, and so they're going to take it out of your future revenues. Or did they just not pay you because they knew that was going to happen?
Tony Jensen
Victor, I think the former is the correct one, where the first pricing that happens, there is three different pricings during the course of settlement. The first pricing happens immediately when they load it on the ship and of course that was done back four months ago or so at higher copper prices. And then there is a second provisional that gets paid that [fuse] up the grade and the tonnage at the smelter, but the final pricing. The final value of the metal is not determined until of our four months or three to four months after shipment. So, the initial payments were essentially an overpayment from the smelter and then there is an adjustment down with the reduction in significant copper price movements. So, we don’t have to pay any money back, but, we were paid in advance as well and so the revenues that we received earlier are just being netted against royalties that we otherwise would receive during the fourth quarter. The fourth calendar quarter.
Victor Flores – HSBC Securities
Okay. So, but you did receive payment during the quarter?
Tony Jensen
No, the and the reason for that is because the negative price adjustments exceeded what the production royalty would have been. So, let me try it again.
Victor Flores – HSBC Securities
Okay. So, you got, so the number was sort of negative 1.3, but they didn't give you anything and then you are going to have to I guess not get revenue from them once the copper price improves?
Tony Jensen
You have got it.
Victor Flores – HSBC Securities
Okay.
Tony Jensen
Okay.
Victor Flores – HSBC Securities
Thank you. I mean it should be clear, but I just wanted to ask the question on that.
Tony Jensen
No, it's an anomaly this quarter so. Thanks for everybody on the phone to [listen] to that.
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