Q1 2021 Comstock Mining Inc Earnings Call
Which included 70 speed of over of tenths of an ounce of gold, including about 25 feet of over a quarter of an ounce of gold per ton all near surface.
Each one of those reported results included nearly one ounce per ton of silver that's literally <unk> 90.
Ounces per ton of silver concurrent with every ounce of gold.
That was discovered they also reported a whole Tc double of six which had over 50 feet of over 0.05 ounces per ton of gold, including 15 feet of a 10th of an ounce per gold and the and again in that same scenario almost an ounce of ton per silver concurrent with the ounces of gold just to put that in <unk>.
Contrast, gold grades of <unk> <unk> ounces per ton not not a 10th of announced not a quarter of an ounce.
Now the point of three are strongly economics in this environment strongly economics, so Tony's finally ramping up the near surface drilling.
And they just recently announced that they're going to add another drill rig to the southern Occidental and strong part because of these good results.
Planning, an additional 23 holes on additional 7500 feet of near surface higher grade targets.
The plan now to fully complete accelerating the fully complete that near surface oxide on drilling.
Hopefully come up with the resource estimate relating to the southern part of the Occidental, adding that to the Lucerne resource estimate and putting out of technical report.
For sort of those combined multiple resources again, we have royalties on all of these properties, but an overview of the total transaction.
It has turned out extremely well for us we of annual return reimbursements of over $2 million. We have of monthly cash income now that would be annualized at almost 700000 on that 12% secured cash paying note remember that security is on the entirety of the Lucerne and the mineral resource package, we have one.
The 5% MSR royalties on all of the properties, including the stern, including the Occidental, we have two 5% on the higher grade more perspective on northern Comstock Lode claims and we have an option to take that up by an additional 3% from five 5% loyalty on.
On the most prospective parts of the load which is just huge.
Let me give a more granular here for us turning to the Mercury remediation business during the first quarter, we bested our full 25% of MCU. So we took that.
The ownership plan in option rate to fruition plus of course, we own directly in addition to that 50% of the MCU, Philippines joint venture putting us at 62, 5% of all of the MCU participation.
Last week in the Philippines, We received our first order for 300 cubic meters of clean sand and gravel and the last truckload of it was picked up yesterday. This is for a contractor of a flood control project of seven kilometers away from our operation and they already require another 4000 cubic meters of two inch clean <unk>.
<unk> plus a whole ton of cobblestone cobble rock our process clean the mercury out of the soils, but it also cleans these higher larger rocks all of which we clean we produce we have two other sand and gravel of buyers that are currently negotiating with us for more of the clean offtake.
There there seems to be monstrous demand for Brandon South sanding gravel certainly in the Philippines with all of the construction that's going on having said that there is an even bigger sand and gravel.
The scarcity apparently globally that we've been reading up on and understanding so we're very very good position there.
The gold and Mercury contents have been very very low to begin with that's as expected for the lower part of the river basically we're starting in the lower part of the river and we continuously moving ourself up River.
Later this week the next week, we will publish some photographs of the operation operating in currency that you and as it moves up river. So you can get an appreciation for the scale of what we're doing we're starting to see now more meaningful amounts of Mercury content as we sample of river, we see even more.
So this is really honestly the first month.
Where we've had what I would call stable continuously operate operating activities.
In March we just got started with a lot of government oversight in April we had we have moved the facility twice as we get situated.
And there was some flooding.
The typhoon whether all of that settling in of Nathan really great. So far so we looked like this month is really the beginning of this thing moving forward I want everybody to recall that we've earned our 50% equity.
Our additional 50% equity in the Philippine operation.
With the $2 million secured loans and Thats $2 million secured loan has accelerated repayment provisions so as the.
Revenue starts generating of the cash starts generating we start getting paid on that loan we retain our 50% ownership in the project. There's the potential of lifespan of six to nine years, so paying very very well.
And even the repayment of the recapture of our investment.
Moving on to the Linacre during the first quarter as everyone knows we acquired nearly half of <unk> in one fell swoop.
With the Reits already committed in the research already committed to owning over 64% of critical to this acquisition with securing the previously permitted existing state of the art battery metal recycling facility right here in the Tahoe Reno Industrial center in storey County, just 10 minutes 10 to 15 minutes from our silver Springs properties.
The plant sits on 11 acres of prime industrial land and could not be in a better position in the U S directly across the street from the Giga factory to move into this business, we assess the plant the.
The building the lab facilities, the water treatment facility the air quality control.
Equipment to be valued at well over $25 million <unk> secured of the acquisition of that facility for $14 million Comstock has the security over that facility.
So it couldnt be more perfectly situated to receive crush separate battery materials into black mass the first.
When we first secured the facility then we committed $10 $75 million per that 64% of <unk>, which puts it out of post the evaluation of only about $17 million.
As I mentioned, we feel like the facilities already worth of that but that's not what's exciting for us what's exciting for US is to have of 20000 ton battery metal recycling facility that can produce pure cathodes.
And just just last week <unk> has selected the ECM renewal process solutions in conjunction with another company called plain sight innovations highly experienced designers and builders of large scale renewables renewable material manufacturing facilities to build our crush.
<unk> and separating system that produces the valuable black mass plus of course separating all of the byproduct copper steel et cetera. This will allow us now to finalize our permit submissions and enable the first major phase of our business plan, while green line and their associated engineers finalized the engineering design.
On construction for the phase II part of the operation, which is then to take that black mass all the way to pure cathode materials. We've had another development, though when it goes also engaged BSI in Rps to develop a second process for taking whack math to pure lithium carbonate nickel cobalt.
Easier of the graphite, we've always intended to have multiple product lines downstream, but we were so impressed with the work that the Rps and <unk> doing on the crushing system and with the technology that they already have in house for solve the construction to allow us to develop our own IP.
Debt.
That would produce the peer scares commodity metals. So the business model of the business end markets are expanding from the very same source of the battery metal material.
Let me conclude my prepared remarks by emphasizing that we've established and published at last year's annual General meeting very very specific performance objectives, that's consistent with everything that I just update you on and everything else that we're doing for the next three years. So that includes commercializing these high growth yes.
Compliant renewable businesses. It includes acquiring additional high growth cash generating ESG businesses.
Establishing of course and growing our existing mineral properties and monetizing the non strategic assets to fund the growth of these new businesses. The bottom line is we're extremely focused on only the items. The timeframes that we've published and during this timeframe. We believe it will become extremely clear.
The clear than it is now for sure of clear then even could be until we're communicating some of these businesses beyond the MCU beyond <unk> that were pretty hardcore right. When it comes to these renewable climate and smart manufacturing businesses are monies, where our mouth is the program was designed in debt directly.
Links the strategic performance objectives, with our goal of delivering half of $1 billion in shareholder value at least $12 a share and then aligning all of our people with a 100% performance based stock based compensation. The program's been published in January it's crystal clear if we deliver.
Our shareholders are rewarded if we don't deliver we don't get anything so I'll pause on that back and maybe turn to the Q&A through the reserve the zoom Q&A mechanism.
No that's great Corrado.
Not surprisingly we've received quite a few questions of you're making your presentation and also not surprising the you addressed a lot of those questions with the presentation. However.
However, we do have.
The question that was just a little more detail of the person asking for a little more detail what is the timing of the mineral resource estimate and preliminary economic assessment of feasibility studies for Dayton and spring balance great question. So we have of schedule now it's <unk>.
<unk> Mike <unk>.
Who leads all of our resource engineering and resource estimation work has taken the data that Larry Martin, our chief geologist and White Cohen. Our junior geologist has spent I would say almost a year pulling together the schedule has about three months to create the resource estimate which.
<unk> is now fully underway.
Update the resource estimate and cash.
Our operate with very little bear for the review on publication of the report.
The the preliminary economic assessment and so.
To be clear the second report.
That would follow this one would include.
A certain amount of drilling that would occur in the day.
That drill program has already been defined by our team as we review it we will incorporate it and publish it as part of the first technical report. The first technical report will discuss certain economic considerations, but it won't be technically a PEO.
So what we intend to do with published the resource estimate first.
And then do some amount of drilling some amount of development some amount of.
Economic profiling and then the second report.
It would include a preliminary economic assessment or are we.
We wouldn't expect that report until 2022 because in between the first reported in the second report.
Some of them, some really exciting drill drilling to do.
Alright, and moving on to one of our other segments.
You mentioned LTE revenue.
What are your expectations for the remainder of the year Yeah, great question. So the.
The system in the Philippines does about 150 tons per hour.
Actually of faster system than the than the Mercury remediation system. We have here on the Comstock, which is more of a of a pilot of 25 ton per hour of testing system.
<unk>.
We're up and running as I mentioned with the sand and gravel on all of our profile show that if we're running the system full and selling all of the sand and gravel that we're making a profit without any mercury and gold content. So this is a huge de risk or for us and to be.
Really blunt, we had no intentions of being a sand and gravel.
The producer we had intentions of remediate in the soil extracting the mercury and extracting the gold and being of gold producer.
Soil remediated or so in other words, the soils would've been going back.
Into the environment clean the fact that they are saleable was.
Kind of a surprise was the pleasant surprise for us So it's derisked it.
So so we can we can guide to that rate that we will we will be net positive. We can see that now that's what we expected for sure that's not the goal the goal is to.
To be able to remediate meaningful amounts of mercury and get meaningful amounts of coal. That's what we expect we don't have enough data yet to be projecting gray.
Grades of gold.
And revenues, but over the next month or two we'll start to get more data as I mentioned on the call on the prior part of the call the.
On the.
The the grades improve as we move up river.
This is this is factual based on how the artisanal mining originated.
The waste material into the river most of it's at the top of the river much of it flows down obviously.
Both because of the water flow and the gravity, but button.
But even having said that most of it is trapped in the upper part of the river. So I guess the point will be as we're sampling and by the way as we are operating we have like column advanced teams constantly sampling up river that's the.
That's mostly to determine what the best next location.
Move the remediation processes, but it also starts to give us intelligence on the higher Mercury content and the higher gold content as we go up the river. So the answer is we don't know enough yet.
I can say this that when we modeled the.
When we model of the original plan it gets meaningfully profitable with just the 10th of a gram of gold per tonne of 10th of a Gram is of very very very tiny number we think of sort of the low end of the of the business model range as one Gram literally 10 times more so so it's in that room.
That will start to be talking about ranges of 0.1.
Five to one grams per tonne coming out of the Mercury amalgams.
We're not limited to that it could be significantly higher but if those numbers were going to be we're going to be very profitable. So we're excited to see that develop we're excited that.
Literally for the last 40.
Three or four trucks, a day, we're leaving our site.
Taking the sand and gravel that they purchased so the fact that we're operating stably on a daily basis. We're shipping day, we are starting to generate good revenue.
It's the big milestone for us.
Okay, our net.
Question on first of the statement.
Before providing additional information on <unk> in your presentation.
As you know this sector has its challenges such as securing permits and supply agreement can you speak as much as you can to these two topics yeah. Yeah. So I have to tell you I have to tell you all of that the.
The lithium battery recycling business has been.
For me the most engaged the most fun.
Over the last few months that of having quite a long time. There are some there are complexities there are meaningful complexities that we're thriving on right now.
They seem to fall right into our wheelhouse. Okay. So we think of it think of the business.
Three major phases and the first phases.
Securing feedstock receipt and storage of materials, you think that that would be the simplest part of the process. It's actually by far the most complex part of the process because the the record rules.
The environmental laws associated with just the moving of battery material and the storing of battery material is incredibly complex, it's especially complex. If you don't have record permits which pretty much none of the battery metal recyclers are pursuing because rechler permits full retro perm.
Our equivalent to like NEPA permits I mean, its potentially half a decade right to achieve those and that's not part of our business plan either but what is part of our business plan is not only to synchronize the receipt annually of 20000 tons of batteries per year to our state of the art facility, but also to have.
Alternative sites of for storage and so as where we think we have a big competitive advantage that we not only of an existing state of the facility. We have 10 square miles of real estate right in the same county.
On the Comstock properties, a number of them which are per.
Perfectly situated for receipt of these types of materials.
So we've got of sort of combined strategy of.
The receipt of storage and partnering with the suppliers of this material and.
And then of course being at the highest end of producing black mask, the highest end of producing cathodes per cathodes and then the highest end of now incur.
Incorporating a whole another line, which is to commodity materials, having said that right to be to give you as much information as possible as requested.
We have designed the platform.
We have assessed the regulatory.
Footprint of requirements, we see no major obstacles.
And we're about two weeks away.
Implementation mode of starting to reach out to the market.
Engage and engaging.
Material contract and then start the process.
Of the supply chain coming to us.
Second phase of the business is the crushing separating and producing of black mass and we've now designed the system.
When I say, we obviously the experts in the field and the experts in the industry that do this kind of thing.
We believe we will be.
The most state of the art.
In terms of crushing separating and the outcome of that is the purest black mass to have the poorest quality of black mass and so so that second phase.
We're in the throes of that right now in a manner that will allow us to finalize our permits.
To get that all in place the.
Third phase, which is it's important to say that.
Phase one in itself is hugely value, creating if you think of phase one.
We are really not as much in the mind of just synchronizing 20000 tons of materials through the two one facility.
Yes, we think like miners. So we think of these batteries is ore reserves. So we're of the mind of building.
Reserves that are that are meaningfully greater.
Then the capacity of which will be producing initially.
So there is huge value in building reserves. The second value is in having the capability to produce pure black mask.
And Thats saleable.
So if the world ended downstream for some reason, which theres no reason, but if the if the world we have of profitable business.
Producing storing selling black mass K, obviously, that's not the goal and then the third phase is to be able to produce the purest cause of not only nickel cobalt lithium magnesium graphite.
But also.
Pure cathode materials, which have extremely high market value and then all of those spectrums, what we love about this business and all of those spectrum.
The values of growing up right. So the business is growing exponentially in terms of volume and the values of the core materials are going up so I couldnt couldnt be more exciting right now there'll be more to share as we move forward.
In the in the permit filings in the.
And the restart and the receipt of storage. We're also looking at some very very interesting complements to that line of business that will dramatically enhance what we can do and that some of that is tied to the regulatory restrictions so containment.
Transportation.
Breakthroughs in the market for that stuff that were direct talks with so a lot of exciting things are going to come from let it go.
Alright, well, we have a couple of questions about the business here on the Comstock Lode.
To the extent possible could you. Please comment on some of the management changes that protocol and how it might affect there.
The exploration plans.
And then Comstock also picked up two patented mining claims of the northern end of the Occidental trend can you comment on the significant yes. So so the.
So with tone on management I don't want to.
The only really speak to what some.
What.
Whats known what standard is that they made a management change.
Sure.
In terms of their CEO.
Brian mentioned Heine, who is the chief geologist.
<unk>.
Technical professional has agreed to be the interim CEO, Brian we know very well we worked very closely with and he has been leading all of the drill program results.
The we always thought that.
Of combined.
The drilling program of growth.
After some very very deep.
<unk> high grade targets on the northern part of the load.
Buying with some near surface targets complementing with Cerner at the southern part of the Occidental trend was the right strategy.
Seem to go heavy on the deeper targets first.
But now it seems to be rebalancing to both targets, which we think we agree with that we think is the right strategy.
So so.
I don't I don't think that they're going to.
They're going to.
Sort of.
Missed the beat with the Occidental because of the Occidental is.
It's just easier to drill.
Of near surface targets.
I was surprised by the grades I have to say like we knew there's gold and silver grades Theyre near surface. We knew there were oxide ores, we were reasonably confident they're there.
The economics, but the grades that came out of those three holes.
And when you look at their press release on the profile of the proximity of the surface and the trend that you are drilling into that sort of fit out and thats, what we like.
I don't think I don't think of people appreciate necessarily well that the.
The accident on the southern part of the Occidental and Lucerne on almost like twins.
Two near surface resources are sitting right next to each other so there is potential for remarkable value aggregation there.
So.
Yeah, I think Brian as interim CEO. So I guess that means they are probably considering another CEO, but when it comes to what the company is right now it's an exploration drilling company, Brian on the exploration driller, So I think they're good there.
Alright.
Then.
The other question about the the dengue ramps at the other end of the trend and the.
They wanted to know this shareholder of us know.
We still retain the mineral rights.
Yes.
Yeah, Theres not we don't.
The good question.
Generally speaking every time, we do something.
We would want to retain the mineral rights.
As a point of philosophy, but.
But the.
The we don't we have the Daney, we have the Daney patent.
But right up.
Two the Daney ranch that's actually.
Once the initial cause of us acquiring the ranch was we were acquiring the 400 acres of mineral properties, including the day any patent in the Daney original mining works that boats right up to the ranch and.
And we have certainly retained all of that that's what we were acquiring in the first place, we don't really see meaningful mineral prospects beyond the patent.
Into the ranch area.
So we have a two year lease option. They have the rights that they are leasing the facility now paying very good monthly rent to us with the right to acquire it in September of next year, we suspect that they will acquire it.
There is on.
90, plus percent chance that that's what would occur.
Alright.
Not really the fact that crossed our mind.
We'd be happy.
Sure.
The phenomenon of property and every property on highway 50.
Any property that of box Highway 50 goes up in value like every month so.
Yes.
<unk> got a good price they will get a good property.
I don't think theres any of mineral applications to really think about there.
Alright and.
Following up on that.
Now the question.
This person understand that the really come after the updated technical report.
Yes. The first technical report will include a new resource estimate will include the publication of the details of the drill program.
And.
We will have some senses of of.
Of economics, but it wont be the.
The drilling with then follow the concurrent with the publishing of that Rick.
<unk>.
And then the sequence would be the results of that drilling would then be incorporated into a second technical report that would intend.
The second technical report I mean, there could be three or four reports so just to be precise the second technical report could simply be a meaningfully expanded resource estimate.
The results of the drilling and then the third before it could be preliminary economic assessment and the reason for that is not of any notion of delay or deferral is that if the resource expanded meaningfully which is what we would intend with the drilling.
Then economic analysis would have to expand.
To correspond with what we now think the mining potential is so theres a little bit of dynamic there, but yes. The intention would be report drill report.
Okay and then.
We have a.
Shareholder who wants to drill down a little on the MCU Philippine Yep.
I would like to know how about loan will be repaid if there will be what currency will the dollar.
The <unk> pizza, yeah, yeah. So the way the is structured it's a secured loans.
And.
And we get.
So there is a joint venture in the Philippines.
And we have great joint venture partner like I was saying of the day that if on if we.
It could be operating in 15 countries I would wish that our joint venture of and if we have kind of joint venture partners, which you don't always have tickets for share.
We had the MTA.
We want one that's just like theirs.
The one that we have there.
So the way that the structure is works of that 75% of the profits that come out of the joint venture.
Our prioritized to repaying US first so that is how it works.
We essentially operationally locally.
Obviously, we have to work in local currency.
Everything that comes.
Out of their cars because U S dollar basis so.
We don't we don't we're not taking any currency risk.
It's all U S dollar based in terms of what the loan is and it's all U S. Dollar based in terms of what's being repaid.
The local generation will be in local currency immediately converted to U S dollars.
Alright, and the yes. This is a very important topic for Comstock mining and we have a question.
The zero debt.
The dot we no longer have an environmental obligations.
Question. So if you look at the balance sheet Theres almost no liabilities left.
There's almost no current liabilities last year on the one hundreds of thousands of its nothing theres no debt obligations zero, we have one on.
On the one meaningful liability, which is about six.
$6 million reclamation of $7 million reclamation liability.
<unk>.
And it's a long life.
Liability.
That's it.
Intended required to cover the ultimate reclamation of our leaching operations at American flat.
Okay. So that liability is estimated as is estimated.
Estimated has this.
The company or the I'm, sorry of the EPA, the Nevada Environmental Protection agency would have to assume responsibility and do the work for us which tend to mean that they put a ton of administrative costs on top but of a ton of project management costs on top.
All of meaning that ultimately the mining that the company announced the spend over I don't know.
10 15 years.
It would be a lot less in my opinion than the <unk>.
The ability that we're required to record on the balance sheet.
The net liability doesn't even begin.
Until we're done with the mining and processing activities right. So so it's.
It's real it's ultimately along the lines of obligation, but it doesn't have any current impact on our financial position liquidity or anything like that so we do have reclamation liability it's required by law for all mining activities like ours.
On.
It's great to point out like last year, we finished the small.
Not last year, but a few years ago. We finished the small reclamation on the Keystone mine in Lucerne.
And because we did it ourselves we did it concurrently it dropped or our reclamation liability with the state by like half of million dollars and that's an example.
That sort of corroborate how I think of this liability when we do the work ourselves and we do it properly like the.
The estimate is higher than reality, but in this case most of those are two of the leaching facility, which wouldn't even start until we were done mining when you think that even internals best case scenario you wouldn't be thinking about mining CERN for a couple of years right and then how long would you mind and then after.
That you'd start doing remediation so of its long way off.
Alright, just as good as you can tell that people do read our 10-Q on our 10-K filed all the.
As well as our press releases and the review of our presentation.
Quite a few people have a similar question on the call today and here's one that several people of that.
Would you. Please summarize the expected of course, the cash and timing to be realized over the next 12 months.
<unk> with the asset sale sales of marketable securities and notes receivable absolutely. That's of Great question. So first and foremost we have a total of.
Of over $13 million, that's going to come from Sierra Springs opportunity fund for the sale.
Of the 98 acres of 160 acres and some advances that we've made.
Of that money.
It's important to note that Sierra Springs opportunity fund has brought in meaningful capital over the last two years, even more important to note that all of the pre requisite obligations that it Pat acquiring the airport acquiring the manufacturing facility paying for the option on a massive.
Bulk purchase of land and real and water rights are all buying all done now okay. So so as all of that capital is raising in the fund was addressing its commitments.
The timely all of the way through it's very next commitment.
Is the Comstock for closing on the 98 acres of 160 acres and some of the advances so we expect.
13 plus million dollars in the next three to four months.
Total gold we have over 11 million common shares.
You would expect.
The $567 million to $8 million come in not in a rush there, but if we get that.
We could comfortably say over the next 12 months.
<unk> has of note receivable to us that secured the pace of cash interest every month almost $60000 a month, but that's now due March 31 of 2022.
So that's another $5 $5 million. So those are the main sources from securities notes receivable asset sales.
Totaling over $20 million. So that's the time frame.
Alright.
We typically get the question.
Of recall.
People just want to know about the current stock value.
It has seen a downward trend this month.
We're just helping you because of.
Your your perspective on that yes, I will so.
Obviously.
There has been there's been volatility theres been a lot of interest.
We've spent the last couple of months Super dedicated on MCU getting up and running Super dedicated on the <unk> plans being fully scheduled I'll.
I will tell you.
It's been fun, we've been working 18 hours a day.
So engaged in <unk> development the schedules of the plans there just outstanding.
In addition to that and I publish this.
And the last press release and in my comments, we've been working on an additional transaction.
That is extremely complementary to.
Everything that we're talking about right now.
It will with without question undoubtedly.
Undoubtedly.
Demonstrate how hardcore we are with the material science with the manufacturing with the revenue and with the cash generating potential of our lines of businesses, we're going to of another line of business. Okay.
And.
And concurrent to that and to answer your question.
We've been building a tremendous target list of.
Of climate Smart ESG savvy investor targets.
And we started to have.
Meetings.
Just here at the end of the April being in EMEA just to trickle in in part because my capacity has been very low as we've been first and foremost getting the business plans solidified completed getting the transactions negotiated.
All of that's been just falling into place like bricks in the foundation.
What we will do prospectively.
And this is zacks.
Primary.
The ownership of the all of our of all of our performance objectives.
One of them is to increase our investor base by more than 50% in other words, our top 30 investors six months from now nine months, but you know we will not be 30 will be 45 in other words, we're not looking to lose any of our investors were looking to add brick by brick.
ESG Savi.
People investors, who understand the IP, who understand markets and who are very interested in high growth growth of at a reasonable price even valley.
So when you're in junior mining sector alone, it's nice to be environmentally responsible.
Nice to be.
At the highest end of the social order when it comes to.
On how we treat nature in how we treat the environment.
But that's a relatively smaller universe of investors when you get into growth when you get into growth of at a reasonable price when you get into value.
The the.
The universe expands dramatically and you've already seen that just from what happened since February but.
But some of that was strong reaction to good news, which we're very happy about.
We're more interested in building the foundation brick by brick.
Keen investor by keen investor So we're off to a good start but the work is barely just begun when I say that we've had.
We've had two firms and Zach working tirelessly tirelessly to build the task.
To build the target list.
And to prepare we would like to get the next transaction announced because then we think we're in a different.
We're a whole different sector, we're in a whole different level of credibility and then we will attract much stronger.
This expanded base of investors, So we love our existing base.
All of what's happened over the last couple of three months, but it is just the beginning of establishing the foundation for growth. So we have a very calculated notion of getting to a half of $1 billion valuation and we have a very casually of notion of getting to well over $1 billion once we get to that point.
But we want to be pedantic, we want to be focused and so that's our intention there is a very specific plan for it.
And I am excited about.
Talking to new investors of our new business is the buyout revenue about cash flow.
Alright, we've had quite a few people on the.
Thompsons today, who about this question and the license update and maybe just a little more detail and I think this one summarizes the bat congratulation on the success with.
The utility.
Please provide us with an update on the LTE pilot plant on the Comstock Charlie Charlie.
So.
It made the comment in advance of answering this question both of our MCU and let it go.
In terms of our approach, okay, and youre going to see this consistently and everything that we do.
Yeah.
We.
Our very focused right on on intellectual property, that's different that's differentiating and we're very focused on commercializing it to cash flow and we're very focused on protecting our capital as we do it. So in Mcu's case using secured loans to get equity is not so common.
Alright.
In <unk> case.
Ensuring that if there were somehow of failure.
We own assets that are more valuable than the capital that we've invested in this case the state of the art battery metal recycling business I don't I don't usually like to talk about.
The downside protection because.
But I just want people to really understand how meticulous where b and protecting our assets.
As a supportive and excited we are about what <unk> is doing that they don't succeed we have secured loans on all of the assets.
That's how it works, so and they're yielding they're yielding lineker of pays us 8% on our series day investment total pace of 12% on our secured debt. So that wasn't the question, but I just want to make sure some people might be thinking about what's the three quarters of a million dollar 12% bearing loan that you made.
The Tsi will plain sight in the innovations.
Is the <unk> for the next acquisition that we're doing.
Okay.
Right now we've engaged them to engineer and design, new tack for women go thats above and beyond.
We're already talking about but I'm working with these people daily rate to get to.
To get this business up and running now.
Back to the question, but was the questions on.
Seriously yes.
Yes. So the question was.
Tell people about the different types of metal kind of been extracted during the pilot plant Oh, yeah of the pilot I'm, sorry, sorry, sorry, sorry.
Yeah, sorry, I'll, just say on account of gravel standing so yes, so on and on the.
Sand and gravel so so.
I condemn the.
So all right. So on the on the on the Mercury work here on the Comstock, we're doing a tremendous amount of work. Let me say that there is a constraint with the CEO Paul Clift.
He he has the designer deploy year right of the systems and he is in the Philippines working around the clock.
Let me, let me preface the answer too by saying none of these businesses are a layout. Okay. None of these businesses are.
Any Tom <expletive> and Harry can just generally on the business Ron there is complexity right, but uplink, but let me use of the Philippine example, defending graph will demand now.
Now that we're ready to produce all of a sudden is overwhelming.
Oh My God, we got like for people that want the underground with tomorrow.
So paul needed like to acquire two Grizzlies.
To be able to properly separate.
<unk>.
Per the materials.
There is nothing to be found so Paul acquired the metal Paul acquired the materials and he's welding and building the Grizzlies right now now that sounds a little weird, but no thats of Paul does he built sophisticated mining equipment and systems right, but he's literally doing stuff.
On site in the Philippines.
So some.
On my point I wanted to make before answering the question on the on the Comstock system is the worst we're committed to every single one of these businesses, but our engineers and our engineering teams actually thrive when there's a hiccup they thrive when there's an obstacle they solve it right. So there will be bumps there will be bumps atlantica was.
There'll be bumps in the storage solution.
There'll be bumps in how do we deliver sand and gravel, but but.
Going to commit to getting over every single one of those things the solution on the Comstock because pause in the Philippines, we're not running the system live right now and we've got two major activities that are going on here. The first one is we are sampling the heck out of all sorts of different types of materials when we.
Ran the pilot in October November December we learned a tremendous amount about what it liked about certain materials and what it didn't like about certain materials, we learned a tremendous amount about the efficacy of the Mercury reactor, we learned about the efficacy of the centrifuges price. So we have like we have to.
Things going on right now we're sampling the hack out of the materials across the spectrum and refining of law of very very good Mercury amalgams that when we restart the system should be like ideal for for extracting the gold.
The gold grades in the Mercury Amalgams are high.
With tens and tens of thousands of tons of materials or identifying the right time for what we're doing we have reopened our lab on site our lab.
MCU has of lab right next door facility, we reopened our rap.
The the metallurgical lab on the Comstock properties to expand the capacity and we're testing and sampling the materials.
Through our centrifuges into alternatives.
Activities. So we're working very very hard to perfect. The system and that's what that's what the pilot on the Comstock is really intended to be it doesn't have it.
It can make money at 25 tons per hour, especially with some of the great work.
We are seeing in some of the samples, but it was never designed to do the right. It was designed to get to a point, where we're putting in a diverse series of Mercury's the chairman immature amalgams, sometimes reprocessed cyanide tailings et cetera.
And ensuring that the what comes out the other side.
And I'm, saying materials that are weighted more complex metallurgical.
Then what we're processing in the Philippines and the.
The Philippines, we have of system capable of handling.
That current environment. The Comstock system is really designed that we can handle any any.
Mercury opportunity around the world because of the Comstock has the 150 years of of.
Different types of mining experience, it's almost the perfect.
Lab.
If you will to do the right. So we also just.
Got approval from Nevada Department of Environmental protection.
<unk>.
To allow us to disperse the water and soil is coming out right on to our leach pad.
You would think that that would have been something that we had already had the system is designed to be self contained and it was important for us to test the system with its own water recycling with its own process handling capabilities now we've expanded it so that we can actually do that as well as discharge to the <unk>.
Non stop Leach pad, which gives us more flexibility on how we process.
Various types of different soils.
One system will work in one environment another system of work in another environment. So it's really.
Really great. It's very very active like Paul has essentially a total Philippine team in the Philippines and then the rest of his team in the U S is here working on the Comstock, Brad Tom and the rest of the people.
Excellent well, we're right at the top of the hour that does it for the questions definitely want to thank everyone, who joined US today and I'll turn it back to you the product for your closing comment. So I just want to say that we appreciate everyone's inquiries if theyre more please reach out to us directly as a very high important note or any.
The meeting is on June 3rd we've got a lot of people participating we're going to have a little showcase aspect to it where.
There'll be of Comstock geology boost if you will there'll be an MCU boost if you will there will be.
Politico Booth, if you will and then hopefully a lot more news coming for the developments across all of these lines of businesses. Thank you all very much.
Yeah.
Yeah.
Perfect.
Okay.
Yeah.