Q2 2022 Aqua Metals Inc Earnings Call
Good afternoon, and welcome to the Aqua metals second quarter financial results call.
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I will now turn the conference over to our host Glenn Axilrod spokesperson with Bristol capital. Thank you you may begin.
Alright, Thank you Diego and thank you everybody for joining Aqua metals second quarter 2022 results conference call.
Earlier today Aqua metals released financial results for the quarter ended June 30th 'twenty to 'twenty two.
These are available on the investors section on the company's website at Www Dot Aqua metals Dot com joining us for today's call from management is Steve cargo President and CEO Judd Merrill the company's Chief Financial Officer, and Frank Bakker, Chief Engineering, and operating officer during today's call management will be making forward looking statements.
Please refer to the company's reports on Form 10-Q filed today July 21st for a summary of the forward looking statements and the risks uncertainties and other factors that could cause actual results to differ materially from those forward looking statements Aqua metals cautions investors not to place undue reliance on any forward looking statements. The company does not undertake in specific.
<unk> disclaims any obligation to update or revise such statements to reflect circumstances or events.
Anticipated events as they occur except as required by law.
At a reminder, after much more formal remarks, we'll be taking questions questions will be accepted over the telephone from analysts and all other investors can submit a question using online more than their portal, providing todays in last week's press release, we will take as many questions as I can in our available time slot and with that I'd like to turn the call over to Steve Cotton.
CFO CEO of Aqua metals to please go ahead.
Thanks Glenn.
Okay. Thanks, Blayne for taking everybody to the safe Harbor, So I'll move on to the next slide which is our mission, but you'll be the first slide that I presented today and this is a presentation.
Presentation, that's geared towards updates of what we are doing but also some reminders.
And new information for those that are new to the Agua Dulce story. Our mission is to provide sustainable metal recycling for materials that are strategic to energy storage applications, and our technology, which we call Aqua refining returns raw materials directly back to the manufacturing supply chain in both the.
Lean way in an economical way, that's reducing reliance on mining to meet the growing demand for energy storage systems that are battery based.
On the next slide.
We are the only recycling technologies that are aligned with the U S Department of energy vision, which is to use air and water to recycle and electricity to recycle critical battery minerals, we have PV Aqua refining what stands for led Aqua refining, which is commercialized and we'll talk about.
Our process and and how where we are with the first deployment with our first licensee and we have lithium operate fighting both of what your room temperature closed loop and fundamentally non dilutive processes. The lead off Refighting is commercially proven and we are deploying that with our first <unk>.
<unk> in Taiwan later, this month and we'll get into some more details on that in the future slide and we've been expanding rapidly into the critical minerals associated with recycling of lithium ion batteries.
And those periodic table of the elements symbol stand for cobalt nickel manganese copper and lithium for which you'll see examples.
Taste of what we've been able to accomplish with our lithium arc refining efforts and the results of extracting those critical elements our processes also cleaner and more cost efficient.
Recovery in a very efficient recycling process as compared to incumbent smelting processes and what we see out of the marketplaces. That's what we characterize as traditional hydro metallurgical processes as compared to our Aqua refining process are.
We also produce a very high quality product and we will explain that.
It shows that the products that we created already with the lithium refining a process.
And our entire set of technologies is really well patent protected and we will talk about that in future slides as well.
Moving on to slide five I want to summarize for everybody are very active Q2, 'twenty two 2022 highlights.
Accomplishing this past quarter.
First off.
All the arc refining equipment for the lead off refining licensee at Acme metal enterprises arrived in Taiwan, and installation and commissioning.
This month in July .
To date, we have also successfully recovered all the high value metals and minerals from use lithium ion batteries, including high purity lithium hydroxide copper nickel.
Cobalt and manganese dioxide.
We made an announcement today that we'll talk about about lithium hydroxide and I'll ask Ben to kind of take everybody through what the these.
Minerals looked like as we extract.
Third we proved the bench scale are clean and economical metals recycling process.
Fourth we initiated deployment of our first lithium ion recycling pilot operation, which is located at our innovation center in the Tahoe Reno Industrial center and that is slated to begin operations. Later this year only the matter of several weeks.
Next we signed a letter of intent, which was announced today with Dragon Fly Energy Corporation Dragonfly energy is a.
Lithium ion battery producer.
And they would purchase.
Commercial quantities of lithium hydroxide from Aqua metals sourced sustainably from recycling to support the ongoing development of their solid state.
Am I on battery technologies, and future manufacturing activities Dragonfly energy by the way is located right here in the Tahoe Reno area as well.
Aqua metals will also be providing recycling services from scrap materials.
Dragonfly energy S feedstock into our process.
Lastly, and certainly not least is our technology allows us and we believe only us to make 100% of our operations using the elektron is the reagent instead of fire chemicals, including our opposite of Ami Innovation Center, 100% powered by renewable energy. So we were already 100% or.
Today as a company and we will be operating the pilot plant that will be turning on very soon with that.
Hubbard and to prove that you can truly and sustainably recycle lithium ion batteries with renewable energy sources.
Next slide number six a little bit more about our deployments in Taiwan.
This is slated to have the installation commissioning in early ramp of the first phase at this point happened.
In a in a very near term peak time period, whereas the installation site prep.
The team is traveling to Abbvie, beginning and its just a matter of days this month.
And all major equipment and electrolyte as pictured as you can see is on site and the phase one estimated completion is going to be by October of this year. So very quick.
Path to success with our phase one is what we anticipate and that is commencing again in a matter of days really.
This next slide is a little bit more about dragonfly energy. This is a picture of one of their locations here in the Tahoe Reno area.
Lithium arc refining uniquely recovers the high value lithium that's currently lost in the smelting process today of the five per cent of batteries that are recycled their lithium batteries, while the other 95% into the landfill. There's a total of zero lithium recovery with smelting incumbent processes lithium arc refining allows us to.
We cover all nearly all of the lithium.
Dragonfly with purchase commercial quantities of the lithium hydroxide, beginning with our pilot plant.
Our ongoing development of solid state lithium ion battery technologies and future manufacturing activities.
Aqua metals will also provide the recycling services associated with the scrap materials as well as lithium ion cells that come back from Dragon fly energy.
Dragonfly expects to begin production of a solid state pilot line as early as 2023, which is quite exciting to see such a large facility being planned for 2023 production.
Lithium being sourced not only.
S through traditional resources, but through a sustainable methods such as Aqua metals. So we and dragonfly are very excited to embark upon this partnership.
I'm going to now ask Ben Packer, our Chief Engineering and operations officer to take us through some of our recent achievements this quarter with the innovation Center and I'll turn it over to Bert go ahead.
Thanks, Pierre I'll start on slide eight on the left side you can see black mask that we've taken into our innovation center here in the Tahoe Reno area and produce their array of metals and compounds that you see to the right.
The the metals in particular are extremely high value in the form that we produce because of their purity and they're able to be sold back into the commodity market or into the battery market.
The other three the lithium nickel and manganese dioxide are all in compounds that make them extremely valuable again as a commodity versus trying to meet a P. Pam spec. This allows us to bypass long qualification processes. It makes it really easy to sell to a large array.
Do you have customers that are looking for these metals.
Right now.
On slide nine.
Innovation Center. We are currently have this facility prepped, we've got the utility has put in place.
And ready for the equipment to start coming in all of the major equipment is on order and we're tracking each piece and we see everything coming in on time in the August September timeframe that will allow us to start commissioning. This facility in October and hopefully in the month of November we're breaking on visitors.
Potential partners potential customers.
We can show up this facility and show off the product.
Significant scale on the output side.
We've hired the key team members to support this.
And we've.
Also started working on offtake agreements, we have we do have the black mass secured for this operation and we used the data from our lab scale testing to support the design and the scale of this facility following a standard chemical industry.
Industry practice.
To allow us to scale successfully without issue.
With that I'll turn it back over to Steve for summer.
Also on slide 10, there's another view of the innovation center just to get people with respect to what the other side of the pilot will look like in the left there you'll see where the black maps. It goes into the process at the beginning of the process. So we wanted everybody to be seem to be able to see that you. In addition to what.
Then just mentioned.
I'm going to go now on to slide 11, and summarize what we've just told everybody and then I'm gonna be handing it over to Judd Merrill our CFO to talk through our financial results.
So summarizing.
Taiwan is on track for Q3 installation commissioning and ramp for the lead off refining licensing operation. So we're very excited about that the lithium.
I am off refining pilot is on track as Ben mentioned to begin operations in Q3, and we're targeting with you my initial off refining revenue as early as Q4 this year.
Ragged play energy letter of intent has been signed and announced today. So again that partnership is one that we're very excited about and we anticipate that we'll be establishing further feedstock and offtake relationships that we'll be able to announce that the future date.
Lastly, all operations are powered by that renewable electricity and we expect to be the greenest and most economical lithium recycling technology available.
With that I'm going to hand, it over to Judd Merrill our CFO for the financial overview.
Thanks, Steve.
I have a few comments on each one of the company's financial statements and so first of all I'll start with the balance sheet.
So we did in the quarter with total cash of.
Approximately $6 4 million.
We had working capital of approximately $21 million, our strong working capital balance keeps us healthy as we move forward into our with.
With our current activities even into next year.
One of the bigger portions of working capital balance is about 16 million lease receivable related to the sale of the plant to Atlantica. We are only a few months away from collecting the remaining balance, which we expect to collect either by October one of this year or by March 2023, depending on where we're gonna co exercises its.
Ability to pay off early or wait for full term. So lets puts the collection of these funds in the next two to eight months.
There was very little change in the company's liabilities as compared to year end.
The company continues to be debt free.
There were no other significant changes on our balance sheet. So I'll move to the income statement.
During the second quarter of 2020 to Aqua metals continue to focus on the research and development activities.
Related to the lithium ion battery recycling and also we focused on the preparation of commissioning now Acme metals facility.
So the company did not.
We're not in any commercial production during 2022 and as a result no.
Our revenues were generated during the quarter.
On the cost of product sales decreased by approximately 51% during the quarter to $1 million compared to the $2. One in Q2 of 2021.
And this decrease in this quarter was due to wrapping up of the plant cleanup projects.
Research and development cost.
Which included expenditures related to improving the lithium ion battery.
Refining technology.
Yes.
During the three months June 30 that ended June 32022.
This increased during the quarter by approximately 196% compared to the three months ended June 32021.
As we've talked through this presentation.
R&D is crucial.
Part of our business strategy and.
It really focuses on further advancing the development.
Of the Aqua refining of the lithium batteries. So these costs included expenditures made toward building out our pilot facility.
Which we said is expected to be commissioned later this year.
General and administrative expenses increased approximately 12% for the three months ended June 30th 2022 compared to the three months ended.
At June 32021.
Increases in this category included changes in stock based comp and the increase in professional fees.
For the second quarter. The company 2022, the company had an operating loss of $4 million compared to an operating loss of $4 4 million for the second quarter of 2021 and net loss for the quarter of 2020 in the second quarter of 2022 was three.
$3 2 million or zero <unk>.
Or <unk> per basic and diluted share compared to net loss of $8 million or <unk> 12 per basic and diluted share for the second quarter of 2021.
So finally on the on the cash flow statement.
So net cash used in operating activities for six months ended June 32022.
In 2021 was $6 3 million and $4 9 million respectively.
Q2 cash needs are actually a little lower than we had in Q1.
Q1 is actually a typically a little higher but this quarter's average monthly cash base cash needs totaled a little little over 750000 per month.
But we do expect Q3 and Q4 to be in that.
802 by 850000 per month range.
This increase.
Over the next few quarters largely due to the addition of more employees and consultants.
We invest more in our lithium iron battery recycling technology.
Net cash used in investing activities for the six months ended June 32022 was <unk> 4 million.
And it was really made up of three items first cash 1 million cash used toward the purchase of property plant and equipment.
Property and equipment second cash used the point 5 million views towards the warrant exercise atlantico that we did.
And then these two cash uses were offset by a 1.1 million proceeds from the sale of equipment.
And net cash used by provided by financing activities was $5 million for the six months ended June 32022, and that really consisted of $4 6 million net proceeds from the sale of Aqua metals shares pursuant to the ATM and point 4 million proceeds.
From the lease of the building.
Almost all of the ATM usage was in Q1.
So our current cash balance asset sells monthly lease payments.
Expected minor revenues for the Acme in pilot operations and the completion of the sale of the plant and building.
Our balance sheet healthy and allows us to execute our business strategy throughout the rest of this year and into 2023.
And with that that concludes my remarks on the financials I will now turn it back over to the moderator.
For Q&A.
Thank you.
And ladies and gentlemen at this time, we'll conduct a question and answer session.
Yeah.
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Our first question comes from Colin Rusch with Oppenheimer. Please go ahead.
Oh, thanks, so much guys.
But I just want to make sure I understand the cash flow here and then how much diligence you've done around being able to collect on that receivable. So it sounds like you're gonna be able to collect the vast majority of that debt outstanding foreseeable bolt by October one and I guess, how confident are you that that cash is available right now.
Yeah. So we've had discussions with medico and and you know their.
Their major on Investor Comstock and.
All indications that we received from them and those funds will be here and we feel very confident and that's the only question Mark is exactly when because they do have the option to wait till March.
So if.
If they exercise that option to wait until March and there was a $2 million in nonrefundable deposit required to be made.
So we see cash coming in.
For sure in the short term it could be a smaller amount could be the large amount.
But for sure we feel very confident that our.
So.
By the end of the term that will have received a full payment on the building.
Okay. That's super helpful and then on the technical side.
I'm curious about.
You know kind of the the hydroxide volumes that you guys are producing and one of the issues that we're seeing coming out with some of the newer technologies is really you know what's in that 0.1% of contaminants.
Given the kind.
Kind of.
Robustness of this process I'm curious when you can say about your ability to control and remove particular contaminants within names. These concentrates.
Yeah. So.
Contaminants I, probably I'm not going to go into the specifics of the contaminants, but what we do see is that we are able to meet the industry specs.
We've set out.
Some goals that are in line with those industry specs, but we expect to be able to exceed those goals significantly when we reach the pilot unit because of some of the lessons learned so I see our purity going up but based on the initial samples and testing that we've done both internally and externally.
Where we're at we're quite excited that we won't have any problems meeting customer specced with impurities.
Okay perfect. Thanks, guys.
Our next question comes from Amit Dayal with H C. Wainwright. Please go ahead.
Thank you good afternoon, everyone.
With respect to this pilot facility coming up you know for the lithium ion battery recycling how.
How big in terms of volumes capacity any indications of how big this facility will be.
The facility is designed to process 100 tons per year of nationally.
Not all allow us to reach a significant scale.
On a monthly basis are significant.
Mt.
Product of each one of these metals coming through as a result, we'll end up with tons of materials cobalt nickel.
In the middle of 2022 we intend to start ramping towards 1000 tons per year rate.
With the with the goal of.
Getting to a significant revenue and significant volume through our pilot operation.
Understood. So this is 100 tonnes of black mess right you don't book that is correct yes.
Okay got it.
<unk>.
One of the expenses required to do you know what I'm settled as hoped initially.
Capex for this.
And then Jud.
So we.
Made public debt.
Our initial.
R&D budget for this year is $3 million.
And so a lot of that.
With bandwidth talking about that 100 ton.
Our capacity is covered and that R&D budget.
And covered in all the costs that we're talking about for this year.
Okay got it thank you for that.
And just moving onto the equity of finding offering.
Any any new potential customers or maybe you could talk about the pipeline you know so that's all for me.
Sure so for the lead off refining the real eye on the ball right now is to get the Acme, Taiwan showcase facility up and running but we have had and continue to have engagements with various players in the marketplace that are interested in in led Aqua refining and as I've said before.
It's typically a greenfield new builds.
But there's also opportunities for us to.
B looking at pilots of let off refining even within existing facilities. So we continue to work on that sales funnel, but again with the eye on the ball of success.
With the acting Taiwan deployment.
But stay tuned to see more news potentially on the led front as we continue to work through that sales funnel.
On the lithium side, we've already announced our collaboration development agreement with Politico. So in addition to our pilot operations that will be happening at our innovation Center, we have great opportunity with <unk> to expand and scale within the facility.
He was formerly the Aqua refinery and that's about 140000 square foot facility less.
Just about a mile away from our innovation center, and we see opportunity.
On how we work out the commercial arrangement with long ago, we have not announced yet.
How that will look that's the next step is what the commercial arrangements will be and that could be licensing joint venture co processing it and that business model is something that we will share as soon as we finalize what those agreements look like with let it go.
We are also looking at joint.
<unk> venture opportunities partnership opportunities organic plant builds of our own.
Elsewhere, but it's really one step at a time and we're going to get the pilot up and running and scale. That's demonstration quantities as Ben mentioned, while we explore these opportunities and at the appropriate time, we will be able to announce what those next steps look like with the lithium aqua refining deployments.
Thank you for that and with respect to Dragon Slide do you have any sense of.
How much volume do Kim sort of because when these days.
So are we.
In the earlier days, we will be able to provide them. Some samples of the lithium hydroxide very soon coming off of our equipment and as we scale. It will scale to tons of availability as they begin to develop their solid state lithium capabilities and ultimately.
They will outpace with their growth probably our ability to supply.
But however, our ability to scale and keep up with their demand as well as other parties demands.
<unk> begin to really ramp up as we partner with let it go and deploy in future deployments. So we see a lithium hydroxide partnership with dragonfly is a great start and really it's a co development.
Start with ultimate supply that goes into their new product again, where theyre going to be taking the raw materials due to sit doing the cell manufacturing right and you're entitled Arena. So it's a great sustainable local source for them.
And it's also a great opportunity for us to work with others are too.
<unk> also provides a great materials that are coming off of our process inclusive of the metals as well as lithium hydroxide.
Understood. That's all I was going to someone's guys.
Thanks.
Thank you. Our next question comes from Shawn Severson with water Tower Research. Please go ahead.
Okay.
Hey, Sean if you are speaking, we can't hear you might be muted.
Can you hear me.
Now we can.
Yeah.
Oh.
Mr. Simon so it looks like you have a poor connection if you want to call back.
Why don't we take some questions our long stable, Sean Reconnects and and you haven't got time to do so we've got a few questions in queue. So.
I'll just get going with it there's probably three or four questions that are really around your financial our current financial position and working capital needs and maybe Josh can sort of summarize for our audience.
Finance plan or a cash flow plan to make sure that the.
You've got the necessary resources to.
Two continuing to grow the business beyond the stated cash position.
Yep, Thanks, Glen I'll try to answer those questions.
Yes, so we ended the quarter with the $6 4 million.
And we've been watching to make sure our expenses stayed very much in line can be actually if you look at 2000 22021, and so far in the first quarter two quarters of 2022, our expenses have been fairly close overall.
So that's one way that we manage cash very diligently.
As we as I mentioned.
We do have the cell, we did sell $1 $1 billion of assets in the first half we have another million or so of assets that are held for sale that we expect to collect some of that on so all these things add to our cash balance lease payments on the building the biggest chunk that I've already kind of talked about is the 14 million that they'll do them.
Yeah.
On the buildings that we expect to collect in the next two months.
So if you add all those together and our current spend rate.
Get us up to.
Pilot plant.
And start generating revenues in 2023.
We see that rate takes us all the way through this year and even into the end of that in 2023, just from that those sources of cash and never really talked about what we expect the revenues to be we haven't given guidance on that we're not planning to do that today, but there will be some revenues coming in.
And so that will also be another source of cash and so we feel very confident its something we look at very closely.
I will mention too is another source of cash out there its non dilutive debt, we're very serious about and those are government grants.
And in government loans.
And.
We've spent a lot of time internally looking at these and so we've actually hired.
Consulting who are experts because theres, a large amount of the government grant.
Available right now with just become available.
Very much fit for battery recycling.
You know business model fits what we're doing so.
So we're going to be very active.
And aggressive in going after those.
And those would be.
We don't need those necessarily now for our firm.
Our current cash needs, but those would be for when we want to expand and grow and that's what we're looking at that's what.
That's a big source that we're very serious about it.
Thanks, Judd and actually that's a good place to start for their lost.
Following on the grants because we do have a question regarding to grant so maybe.
You could give the audience a better understanding of sort of the milestones that you have to hit or what specific type of grants are available that aqua metals will be able to apply for.
Yeah, so that the.
The ones that we're looking at are mainly from the department of energy.
And from the the infrastructure money that was passed by Congress and the President last year those funds are being funneled through.
Department of energy.
There's some other sources, but that's kind of the main one.
There's some.
Very large dollar amounts.
$50 million plus that are focused on the battery recycling portion of it that is the piece that will.
Looking at there are some smaller ones that we've looked at it from time to time, you know very small hundreds of thousands of the low billions. If we qualify for those who apply for them.
But it's it's the larger ones.
And we're currently in the process.
Getting through like we understand.
What are some of the criteria are two applying for these in terms of like getting.
Certain partnerships in place getting certain documentation in place and so we're going through that right now.
As they become available we will fly for them.
Okay. Thank you for that.
Next question is how does the aqua metals plan to use or to to access the 100% renewable energy as discussed in the press release.
Yeah, so already NV energy supplies us with as good a.
Renewable energy mix, Ben I believe that's around 30%, 34% range. Yeah. So so we were getting a core set of renewable energy from from that source.
But in our drive to make sure that we reach ultimately a net zero risk.
Our recycling operation and company wide net zero one of the key first steps is that renewable energy credit area, and that's where because our process is powered by electricity, we could buy electricity renewable energy credits, which we've already secured and as I mentioned earlier today. The company is already operating not all.
The the innovation center, but our corporate offices on renewable energy through the acquisition of those renewable energy credits and we think that that's kind of.
A great unique advantaged refining using the elektron is the reagents, because you can't buy renewable energy credits for fossil fuels and things like that.
How are the incumbent recycling technologies or for chemicals for that matter.
Standard hydro processes, so that is how.
We have the renewable energy credit set up today, and that's our focus and we'll be providing more information in the coming weeks and months on Aqua metals journey and halfway neatly net zero company and we find that that is going to be a very important aspect because as we engage in talk with potential joint venture partners and feedstock suppliers.
Offtake partners that is at or really any of those companies are all in that same drive towards net zero and we're going to be the partner of choice. We believe because we have the ability to achieve that.
Zero.
Starting with that renewable energy on.
Where we are already as we sit today.
Perfect. Thank you Steve.
Question about the letter of intent announced earlier today can you just take I guess the audience through.
Steps that need to occur from conversion from a LOI to a final.
Legally binding document.
Yes, so just from a commercial perspective, I'll comment and then I'll ask Ben to kind of calling out what the technical flow will look like.
But on the commercial perspective, the letter of intent is basically the meeting of the minds as far as how we would proceed.
And we'll work out the definitive agreement with Dragon fly and that will have details in it about when and how much.
Lithium hydroxide will provide them.
And ultimately what our volume commitment will be.
Over a probably a multi year period, and we will set up that commercial definitive agreement, we don't anticipate that to be too terribly long.
So probably.
We will be reporting on that between now and the next quarterly update and then I'll, let them speak to the.
Kind of the technical process of how we would get it from the pilot operation over to Devin.
Analysis by book.
Thanks, Steve.
As we ramp the pilot later this year that will allow us to give material too.
Dragonfly that allow them to go through our vendor qualification process.
We've already started meeting with them, we've got joint technical meetings with them, where we describe specification things like that so we understand their requirements and again, where we see no issue of meeting those requirements. So later this year, we should be well and well on our way on the vendor qualification process.
To support them going forward.
Okay. Thank you.
The next question is you mentioned the supply of Black Magic, you've already secured a four year.
Pilot plant can you.
Talk a little bit more about where that supply comes from on your strategy around diversified local suppliers for that black mess.
Yeah. This is an area, where we've been quite aggressive above our.
Agreement with Atlantica, we have multiple suppliers already.
Qualified and we have several more that are in the works being qualified so we've already announced that we've got our piece.
<unk> secured through the next 12 months and we see that just becoming a more.
More and more secure as we go forward. This also has allowed us to prove that our process. Our technical process can work with a variety of different black math.
Providers.
Each one has their own way of processing and developing it. So it's been a great advantage for us to have multiple suppliers on onboard.
Perfect. Thank you Dan.
Our own patents.
Can you just update the audience on the Aqua refining our patents are there any pending patents given.
Given the new entrant in the lithium ion space and how investors should think about patents and if theres any patent applications for the mining industry.
So oh, we have always taken to our patent portfolio quite seriously.
And have well over 70 patents that have already been issued and allowed for Aqua refining in general.
Inclusive of which.
Includes portions of the aspects of copper recovery and things like that for the lithium process.
But we've also applied for a provisionally not only one which had gone into a pending status, but another.
Set of patent material for the for the lithium Aqua refining suite. So we feel that prosecution of that IP prosecution being defined as getting the patents issued and allowed is a critical part of our strategy, particularly in the adult lithium arc refining space, because there's going to be many companies that are in this space.
Employees moved from company to company and you need to make sure that you're very carefully protect your patents you might find other companies talk about how they have trade secrets.
We believe that the value creation and enterprise value ultimately he's also on the patent portfolio, we do choose where we put things into the patents, which is where you publish it publicly and other areas that we do keep its trade secrets on our own but the core patent is also critical if you're going to be considering licensing the technology.
<unk> business transactions and as I mentioned earlier with lithium off refining we intend to operate as a license or but also as an operator and a joint venture partner. So that IP portfolio is a very critical aspect of our strategy are right and I think you need to Aqua metals.
Perfect. There's no more questions in the online portal a navy sean's back on we can take it for one question and then not on the call.
Okay.
Thank you we do have a phone question from Shawn Severson Watertown Research. Please go ahead.
Shawn Severson your line is open.
Hello.
Okay.
Oh.
Okay, I'm, just receptionist still sounds like Youre in a very poor connection.
Can you hear me.
Yeah.
Yeah, It looks like it looks like we can't hear Sean Unfortunately.
Okay. There are no further questions I'll hand, the floor back to our model to our speakers for any closing remarks.
Well I appreciate everybody joining the call today stay tuned for more developments as they happen and we feel that.
It's going to be a very busy rest of the summer and fall as we.
Get through what we the materials that we've taken you through today with the pilot and the deployment in Taiwan and further commercial opportunities that we have in our funnel and we look forward to reporting those to our shareholders and stakeholders and interested parties. If anybody has questions in the meantime feel free to contact us and we look forward to our next quarterly update call.
Thanks again.
Thank you. This concludes today's conference all parties may disconnect have a good day.