Latest / WTR Small-Cap Spotlight / Comstock Inc. (LODE): Scaling Solar Recycling, Monetizing Silver Springs, and the Road to Profitability

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Comstock Inc. (LODE): Scaling Solar Recycling, Monetizing Silver Springs, and the Road to Profitability · WTR Small-Cap Spotlight

• 0:04
  SPEAKER_00: Hello everyone and welcome to the WTR Smith Campus Like Podcast.
• 0:08
  SPEAKER_00: I'm your host, Sean Severson, CEO of the Community Partner of Water Cover Research.
• 0:12
  SPEAKER_00: In today's episode, I'm joined by Christmas, Chief Executive Officer of ComStank Incorporated.
• 0:17
  SPEAKER_00: That trades on the NYSE, symbol L O D E.
• 0:22
  SPEAKER_00: ComStunk is an database renewable metals and energy company with breakthrough technologies that unblock critical supply chain constraints of metals and fuels.
• 0:31
  SPEAKER_00: And we recently hosted Cromando for a Fire Sunday channel where he outlined the company strategy and brought us up to speed on recent developments, including asset monetizations.
• 0:41
  SPEAKER_00: During that Fire Sunday channel ever week, we did get a lot of investors submitting questions.
• 0:46
  SPEAKER_00: So Cromato has joined us today to run through some of those questions directly.
• 0:50
  SPEAKER_00: Also joining us is my WTM equity research company, Peter Gaston.
• 0:54
  SPEAKER_00: Gentlemen, good morning and thank you for joining us today.
• 0:57
  SPEAKER_02: Morning, morning, son.
• 0:58
  SPEAKER_02: Thanks for having us.
• 0:59
  SPEAKER_02: Thanks for having me.
• 1:01
  SPEAKER_00: So Carl, first I'll kick off questions and then hand it over to Peter.
• 1:05
  SPEAKER_00: But the first question is really just the fact you've made several recent changes to align shareholders with the board, CEO, and staff, obviously very critical to investor base.
• 1:17
  SPEAKER_00: What is the next uh next on the road map to further strengthen that alignment?
• 1:21
  SPEAKER_02: Yeah, no, great question.
• 1:23
  SPEAKER_02: We've had three new directors join in March, and it's been extraordinarily positive.
• 1:28
  SPEAKER_02: We we have um you know a strong legal governance background, strong financial uh and manufacturing operating background, and then we have a strong capital markets and even real estate background.
• 1:40
  SPEAKER_02: So we got we didn't just get three new directors, we got an exceptional breadth, you know, of um, you know, of talent to to help us govern.
• 1:50
  SPEAKER_02: And then apparently they're all very hardworking, which is wonderful.
• 1:54
  SPEAKER_02: You know, so it allowed us to sort of realign our committees in a way that they're all hardworking committees, you know.
• 2:03
  SPEAKER_02: So we've already seen benefits in terms of real estate and and how we approach and and ready uh Sonera Springs Opportunity Fund, for example, for monetization.
• 2:14
  SPEAKER_02: We've already seen value in how we've strongly aligned performance-based incentive compensation with our capital market equity investors.
• 2:24
  SPEAKER_02: In other words, we have a stock-based compensation program that's tied solely to appreciation of the share price.
• 2:32
  SPEAKER_02: You know, so those things have already occurred.
• 2:35
  SPEAKER_02: And then what I would say to your question, looking forward, is all of that is really um uh foundational, maybe is the right word, but but for professionalizing the capacity to be a global enterprise, you know, so so when we think about uh an industrial metal supply chain that starts with you know solar panel recycling and clean aluminum, silver, you know, and and other industrial materials, you know, that that's the backbone of what we see uh growing exponentially, you know, you know, first and foremost, certainly across the United States, but then globally.
• 3:19
  SPEAKER_02: And so uh uh a number of our directors have um not only um transactional experiences, but international transactional experiences.
• 3:31
  SPEAKER_02: So I think the next step is you know using that foundation, that platform to truly grow an international global industrial um enterprise.
• 3:44
  SPEAKER_00: Thanks for that, Crado.
• 3:45
  SPEAKER_00: That's music to investors' ears.
• 3:46
  SPEAKER_00: A lot of times in small cap companies, you don't get that diversity and impact on the board.
• 3:51
  SPEAKER_00: And so this is uh this is I'd say fairly unique from what we see across a lot of companies.
• 3:56
  SPEAKER_00: But uh I'll turn it over to Peter.
• 3:58
  SPEAKER_00: He has a bunch of questions, and thanks, Crado.
• 4:01
  SPEAKER_00: Thank you, Sean.
• 4:02
  SPEAKER_01: Great.
• 4:02
  SPEAKER_01: Okay, thanks, Sean.
• 4:03
  SPEAKER_01: So, Crado, we've got uh quite a few questions to go through here.
• 4:07
  SPEAKER_01: Um there's quite a few.
• 4:09
  SPEAKER_01: First of all, we'll kick off uh some questions on the recycling throughput and panel supply side.
• 4:14
  SPEAKER_01: Yes.
• 4:14
  SPEAKER_01: Uh so uh just starting off here.
• 4:17
  SPEAKER_01: So investors are asking uh when does site number one reach 100% capacity?
• 4:21
  SPEAKER_01: Uh and what is your best 12-month tonnage forecast for that site?
• 4:25
  SPEAKER_01: Uh and for context, uh, who is your largest competitor and what is their throughput?
• 4:31
  SPEAKER_02: Outstanding.
• 4:31
  SPEAKER_02: So let me go in reverse order.
• 4:33
  SPEAKER_02: You know, I think the largest competitor is probably SolarCycle.
• 4:37
  SPEAKER_02: You know, they've they've had um they had multiple facilities.
• 4:40
  SPEAKER_02: I think the Texas operation isn't currently up and running, but um, the Georgia facility, um, I just read they recently announced, you know, opening a larger scale operation.
• 4:53
  SPEAKER_02: We we have a different business model, I would say.
• 4:56
  SPEAKER_02: Um, to some degree, we're both looking to be most effective in in recycling solar panels and scaling solar panels, but they seem to have also uh a very strong interest in downstream glass manufacturing.
• 5:08
  SPEAKER_02: So I think that's a different that's a difference that we're we're not we're not consistent with.
• 5:12
  SPEAKER_02: In other words, we're gonna produce a lot of clean glass and we're gonna sell a lot of clean glass, but we're not remanufacturing glass to you know actually sell panels or sell things of that nature.
• 5:25
  SPEAKER_02: So uh that's one thing.
• 5:27
  SPEAKER_02: The the the in our case um we've just announced, right, that our our 100,000 ton per year, which is equivalent of 3.3 million solar panels per year, which requires loading on average, a panel every seven seconds, you know, which we've validated and confirmed that we can do.
• 5:49
  SPEAKER_02: And then we just announced that we've run the whole system, right?
• 5:52
  SPEAKER_02: Feeding a panel in the front end and effectively getting clean materials out, you know, on the other end.
• 5:59
  SPEAKER_02: So that's um that was an extraordinary accomplishment.
• 6:01
  SPEAKER_02: In that, in that announcement, we also said that, you know, within a few weeks, we would fully enclose that system, you know, to actually demonstrate to the outside world that it worked.
• 6:12
  SPEAKER_02: We we had to leave some parts of the system open to show the materials coming out, right?
• 6:17
  SPEAKER_02: In the in the full closed loop system, you literally go from a stack of panels to bagged materials, right, with very human, very little human intervention, you know, in that process.
• 6:29
  SPEAKER_02: Um, but um we don't know anybody, honestly, that can scale to that speed and that capacity for processing solar panels, number one.
• 6:38
  SPEAKER_02: Number two, we are agnostic to the nature and the type of panels.
• 6:43
  SPEAKER_02: Our competitors have some preferences and they have some disqualifiers, like you know, some won't take thin film panels, for example.
• 6:51
  SPEAKER_02: So we take any and all kinds of panels in all kinds of forms, in any and all kinds of conditions, and they all get fed at less than seven seconds a panel.
• 7:02
  SPEAKER_02: Doesn't slow down our process.
• 7:04
  SPEAKER_02: And that that's the difference in scale.
• 7:07
  SPEAKER_02: So we don't see anybody that can scale to that definition the way that we can first.
• 7:15
  SPEAKER_02: Secondly, we also don't see anyone that has even claimed that they're a zero landfill solution and that they recover 100% of their materials for sale.
• 7:27
  SPEAKER_02: You know, so some say they recover 95% of their materials, they don't say that they're selling them all.
• 7:32
  SPEAKER_02: So we don't really know what the true recovery is.
• 7:35
  SPEAKER_02: But we we sell, we recover and sell all of it.
• 7:39
  SPEAKER_02: You know, so so in that context, um, you know, we really feel um like we're leading, right?
• 7:47
  SPEAKER_02: It would be um arrogant, certainly naive, additionally, to think competition won't continue to emerge, or that there isn't competition out there.
• 7:56
  SPEAKER_02: You know, some of the real competitive pressures come with alternative um uh solutions like landfilling or like um just shredding materials hazardously and shipping them overseas.
• 8:10
  SPEAKER_02: We've seen some great government response, by the way, to that, right?
• 8:14
  SPEAKER_02: In one case, we saw a competitor get shut down for trying to ship hazardous materials improperly overseas.
• 8:20
  SPEAKER_02: In another case, just recently we saw the administration say they don't want black mass exported at all.
• 8:25
  SPEAKER_02: Now, black mass is coming from the recycling of batteries, but we have a similar condition.
• 8:30
  SPEAKER_02: So we would look for the government to say, hey, if you don't want lithium, nickel, cobalt, and manganese being exported through black mass, you shouldn't want silver, copper, telarium, iridium, you know, et cetera, aluminum being exported either.
• 8:45
  SPEAKER_02: So that's the trend, I think, is our friend there, you know, in terms of the government wanting to keep these critical minerals here and let's say mitigating these competitive pressures.
• 8:55
  SPEAKER_02: To your last last point and your first point, um, we can do 3.3 million panels a year.
• 9:02
  SPEAKER_02: We have explicitly guided to ramping up to 25% utilization of that machine.
• 9:09
  SPEAKER_02: So that would be the equivalent of 25,000 tons of annual run rate.
• 9:14
  SPEAKER_02: We believe that's critically important, critically important, because Comstock Metals then becomes a source of cash, not a use of cash.
• 9:24
  SPEAKER_02: So that that that is an incredibly critical milestone, you know, for a you know, the company at our level of commercialization.
• 9:32
  SPEAKER_02: It's very huge.
• 9:33
  SPEAKER_02: From there, we'd like to get to to 50% as quickly as possible.
• 9:39
  SPEAKER_02: We haven't set specific guidelines, right?
• 9:42
  SPEAKER_02: Because at 50%, you know, depending on you know pricing and in some of the variables, it would turn the corporation profitable, not just metals, you know, and and then from there as rapidly as possible.
• 9:56
  SPEAKER_02: Like I don't really have an answer.
• 9:57
  SPEAKER_02: We'd love to do that by the end of 27, we'd love to do it earlier, you know, but but it is very important to say that we see the market, we see the market growing, and that we are succeeding in securing the business of the largest customers.
• 10:15
  SPEAKER_02: Like we don't we don't feel any fatal setback flaw or or disappointment in that process.
• 10:23
  SPEAKER_02: It could go faster, right?
• 10:25
  SPEAKER_02: Like we we always want it to go faster, and and I think it's important for our investors to understand that we don't have precise taker pays and precise volume commitments.
• 10:37
  SPEAKER_02: Every week and every month that goes by, those variables grow.
• 10:43
  SPEAKER_02: That's the good news, right?
• 10:44
  SPEAKER_02: But we don't yet have, and it's not because we don't we're not marketing well or we're not penetrating well, it's because the industry is relatively nascent and some of our customers are still trying to figure out exactly how all this works.
• 11:01
  SPEAKER_02: You know, we we met with a great customer um two weeks ago, a great customer.
• 11:07
  SPEAKER_02: We love their business.
• 11:08
  SPEAKER_02: And and and they said in the meeting that um they thought we were only uh West Coast based, right?
• 11:15
  SPEAKER_02: So so that of course we we only have an operating facility in Nevada, so that's not an irrational assumption.
• 11:22
  SPEAKER_02: But my point is they weren't aware that we were we were uh we have you know plans for five locations, six locations across the United States.
• 11:31
  SPEAKER_02: And they were super pleased to hear that, right?
• 11:34
  SPEAKER_02: And then the conversation moved to you know bigger agreement.
• 11:36
  SPEAKER_02: Now, again, that may sound like how did they not know that?
• 11:40
  SPEAKER_02: Well, you know, this is a massive market with very, very large customers, and we believe we're leading in the penetration of those customers.
• 11:49
  SPEAKER_02: So I don't want it to come across negative, but you know, the balance is it's a work in process, it's going well, we want it to go faster.
• 11:59
  SPEAKER_01: Okay, got it.
• 11:59
  SPEAKER_01: And then turning to the the input side, uh, how many tons of feedstock are secured under MSA for 2026 and 27?
• 12:08
  SPEAKER_01: And does the proposed EPA universal waste classific classification change the supply outlook?
• 12:15
  SPEAKER_02: Again, taking it backwards to forward, you know, the proposed EPA universal classification is a bonanza for us.
• 12:22
  SPEAKER_02: What that does is it essentially makes uniform the notion that a solar panel is a hazardous waste.
• 12:31
  SPEAKER_02: And and even though the major states like California, you know, have already designated solar panels as a hazardous waste as a leader.
• 12:40
  SPEAKER_02: And in fact, Nevada has reciprocity in those uh definitions.
• 12:46
  SPEAKER_02: In other words, if something is coming in from California as universal waste, Nevada recognizes it as universal waste.
• 12:52
  SPEAKER_02: That's the biggest advantage that we have in our platform because it's very, very expensive to dispose of hazardous waste in any way, shape, or form, including landfills.
• 13:01
  SPEAKER_02: Okay.
• 13:02
  SPEAKER_02: But to the extent other states haven't uh adopted those classifications, that's where people can get um exploitive, right?
• 13:11
  SPEAKER_02: They can exploit the lack of regulation to say this is a solid waste or this is not hazardous and get away with disposing it in a cheaper, less environmentally safe way, which of course is very bad, right?
• 13:23
  SPEAKER_02: It's very, very bad.
• 13:25
  SPEAKER_02: Uh so a universal designation is a bonanza.
• 13:28
  SPEAKER_02: Also, if the administration did, as I said earlier, designated export control over critical minerals like ours, that would be a bonanza to our marketing and our throughput.
• 13:41
  SPEAKER_02: Um, so the the um the question of how much is is is locked up or how much is estimated, two different things, I guess, you know, because our our MSAs are not take or pay, they're not locked up business.
• 13:57
  SPEAKER_02: What they do is they precisely define every aspect of our relationship, you know, pricing, logistics, you know, terms, like, you know, um nature of the panels, right?
• 14:10
  SPEAKER_02: All of that is precisely defined in the MSAs.
• 14:14
  SPEAKER_02: It's the prerequisite, right, for us to be able to do sustained business with these big companies.
• 14:21
  SPEAKER_02: Then we bid on each one of their projects, you know, but the bids are simple because everything's already predefined in the MSA and it's easier to do business with us.
• 14:30
  SPEAKER_02: Um, if we were to project, um, you know, we wouldn't, we wouldn't guide, you know, past, you know, 25, 30% of our capacity, you know, in terms of you know, existing platform.
• 14:44
  SPEAKER_02: But I think people have heard me say um very well that three or four years from now, the same exact customers with the same exact business would be five, six, eight, potentially ten times what it is today, right?
• 14:57
  SPEAKER_02: So we're not only locking up the best, biggest customers that coincidentally represent the fastest growing simply because their replacement schedule looks like uh, you know, is a high growth, is a high um rapidly growing uh uh um you know circumstance.
• 15:18
  SPEAKER_01: Okay, and you you've touched on this a little bit, this uh this next these next questions that we had several investors that were flagging uh you know whether panel supply will be a bottleneck ahead of the tsunami of end-of-life panels still being years out.
• 15:32
  SPEAKER_01: Um summing it up, um, you know, first, uh is there a plan to source panels already sitting in landfills, some reportedly segregated for easier collection potential potentially via a revenue share with landfill operators?
• 15:45
  SPEAKER_01: Uh and second, uh what else needs to happen for the company to become unconstrained on supply through 2028?
• 15:52
  SPEAKER_02: Yes, very good question.
• 15:54
  SPEAKER_02: So, you know, it's I'm gonna ask, I'm gonna answer it in a little bit of a funny way, not I'm not meaning to be cute or anything, but it will be a relief to us next week, right?
• 16:04
  SPEAKER_02: Week after.
• 16:05
  SPEAKER_02: It'll be a relief to us um when the system's running exactly the way we want it to, or pretty damn close to what we were expecting.
• 16:14
  SPEAKER_02: You know, so so far that's been going great.
• 16:16
  SPEAKER_02: We're really happy with it.
• 16:17
  SPEAKER_02: Um, that our constraint, and we we say artificially, it's the constraint, right?
• 16:23
  SPEAKER_02: Because it's it is the flow of panels not being full, right?
• 16:27
  SPEAKER_02: So it'll be a relief to us in a way that says, thank God the machine's doing everything we wanted it to do, right?
• 16:35
  SPEAKER_02: And now let's focus on filling it.
• 16:38
  SPEAKER_02: But the answer is absolutely unequivocally yes.
• 16:40
  SPEAKER_02: If the machine's not running 100%, that means we're constrained by our ability to feed panels into the machine, that simply.
• 16:47
  SPEAKER_02: And and why are we constrained by the ability to feed panels in the machine?
• 16:50
  SPEAKER_02: Because we haven't done a good enough job redirecting those panels from landfills and and scrappers, you know, to our system.
• 16:59
  SPEAKER_02: But but I don't want to give the impression of people that we're behind on that.
• 17:04
  SPEAKER_02: We are not behind on that.
• 17:06
  SPEAKER_02: We have been on it, we're in front of it, we're leading it, right?
• 17:10
  SPEAKER_02: It just takes time.
• 17:11
  SPEAKER_02: Big market with very, very sophisticated customers.
• 17:14
  SPEAKER_02: You can imagine RWE is a customer, right?
• 17:16
  SPEAKER_02: You you you build a relationship at a major solar field with the general manager, you build a relationship with the EPC that babysits those panels, you you build a relationship with the people that repower and replace the panels, you build a relationship with logistics firms, but ultimately you need to make your way up, you know, to the C-suite, right?
• 17:33
  SPEAKER_02: And and to all, you know, it's an enterprise-wide relationship because these are big companies, you know, and so we're doing all of that.
• 17:42
  SPEAKER_02: And what's happening now, even more, Peter, is that they're visiting.
• 17:46
  SPEAKER_02: We have two site visits next week, you know.
• 17:49
  SPEAKER_02: So um uh site visits have been frequent for us, but now you're coming to see a showcase.
• 17:56
  SPEAKER_02: Now you're coming to see, you know, the full system fully operating, you know.
• 18:02
  SPEAKER_02: And what I mean by fully operating, just because people sometimes get confused when I say that, it's running 24 hours a day, seven days a week, not that it's running at 100% utilization.
• 18:12
  SPEAKER_02: That's the goal, right?
• 18:13
  SPEAKER_02: The goal to be as high a utilization as possible, you know, 92, 93%, what we would say running effectively full.
• 18:23
  SPEAKER_02: So that that is, yes, that's the I like to use the word artificial bottleneck, right?
• 18:29
  SPEAKER_02: It's because something we have control over that we will continue to um to to eliminate, right?
• 18:35
  SPEAKER_02: We do not want to, we want to have more panels than we can handle.
• 18:38
  SPEAKER_02: That that's why we have um obviously that's our expectation, right?
• 18:42
  SPEAKER_02: Because that's why we have created such a significant storage area, you know, right next door to the facility.
• 18:48
  SPEAKER_01: Okay, great.
• 18:49
  SPEAKER_01: So let's move on to investors who are asking a bit more about the the plant economics here.
• 18:54
  SPEAKER_01: Um the first related question uh investors asked is whether the one million ounces of silver per plant figure cited at Planet Microcap is based on measured recoveries at the demonstration facility, and what silver content per ton does it assume?
• 19:11
  SPEAKER_02: So so you know there's a lot of variation there.
• 19:14
  SPEAKER_02: So I don't, I don't, I personally don't think there's any harm in in targeting you know a number, right?
• 19:21
  SPEAKER_02: Um if you have 3.3, so the if is in the context of an assumption, right?
• 19:28
  SPEAKER_02: If you have 3.3 million panels going through the system a year, and if each panel has a half an ounce of silver, and if you recover 89% of the silver, um a million seems very comfortable.
• 19:46
  SPEAKER_02: Okay, we're not running full.
• 19:48
  SPEAKER_02: We haven't confirmed that every panel is 0.5, and we haven't validated we can get 90%.
• 19:53
  SPEAKER_02: But that is what we're working on in the demo facility.
• 19:57
  SPEAKER_02: Yeah, that is what we're working on in the demo facility.
• 20:00
  SPEAKER_02: So um, as soon as we validate a process that yields a percentage, we're gonna be very excited to share that with the market.
• 20:12
  SPEAKER_02: Hopefully sooner than later.
• 20:13
  SPEAKER_02: But it the process is engaged and moving forward very well.
• 20:18
  SPEAKER_02: Not sidestepping, but like people can do their own math, right?
• 20:22
  SPEAKER_02: If if each panel has a quarter of an ounce of silver, and and and I say that not because there's confusion about like what might be in a panel, there's a lot of different types of panels.
• 20:34
  SPEAKER_02: There's a lot of variation between one type of panel and another type of panel, you know.
• 20:40
  SPEAKER_02: So so once we get a relatively um, let's call it statistical representative sample, that that may take many months, okay?
• 20:51
  SPEAKER_02: Once we get a statistical relevant sample, then we can talk about what we're actually seeing, right?
• 20:58
  SPEAKER_02: You know, how much are we actually recovering?
• 21:01
  SPEAKER_02: How much actually what's the in the old mining terms, what's the head grade, what's the tailgrade?
• 21:06
  SPEAKER_02: You know, like how much went in, how much did you actually successfully get out?
• 21:13
  SPEAKER_01: Okay, great.
• 21:13
  SPEAKER_01: And then another question here, if you can clear up on the the tipping fees, there's an investor asking about uh whether the$500 per ton tipping fee is something that prevents large utilities from signing.
• 21:25
  SPEAKER_02: No, the the um the the tipping fee has been well established.
• 21:31
  SPEAKER_02: You know, I don't I don't we don't feel anybody saying, why do why should we have to pay for this?
• 21:36
  SPEAKER_02: This is a very serious environmental hazard.
• 21:38
  SPEAKER_02: You know, it's becoming a bigger, bigger issue as time goes forward, not less, right?
• 21:42
  SPEAKER_02: It's not becoming less of an issue, it's becoming more of an issue, it's becoming a bigger problem.
• 21:47
  SPEAKER_02: But it's not, it's it's very fair to say that this wasn't really well contemplated 15, 20 years ago, you know, the way that um people are contemplating it now.
• 21:59
  SPEAKER_02: It it Isn't it very fair to say that people didn't have budgets established in 2024, 2025?
• 22:07
  SPEAKER_02: It was an obstacle.
• 22:09
  SPEAKER_02: It wasn't people saying, we don't think we should pay for this.
• 22:12
  SPEAKER_02: It was we don't we don't have we don't have approval for this.
• 22:16
  SPEAKER_02: You know, we don't we don't have a budget for this.
• 22:18
  SPEAKER_02: And and why is it why is it that expensive?
• 22:20
  SPEAKER_02: You know, like and but those conversations have been very productive, right?
• 22:24
  SPEAKER_02: And it's and it's you know, we've seen it it holding up, you know, but um but now but you know all that all that dialogue you know is is in the context of nobody has real capacity to process.
• 22:40
  SPEAKER_02: So now we're in a new day.
• 22:42
  SPEAKER_02: Like we have real capacity to process.
• 22:44
  SPEAKER_02: I would say one of a probably a bigger obstacle, Peter, is um the most sophisticated utility companies are not keen on sending you panels paying for the disposal and termination of an environmental liability and not getting a certificate of destruction back very quickly.
• 23:06
  SPEAKER_02: Okay?
• 23:06
  SPEAKER_02: And there's a distinction here too.
• 23:08
  SPEAKER_02: Like, so so that's the that's the good news, right?
• 23:11
  SPEAKER_02: The good news is we have a high-speed machine now that can, you know, not just process materials, process certificates of destruction.
• 23:20
  SPEAKER_02: So you you know that's the first threshold of certification.
• 23:24
  SPEAKER_02: You know what the second threshold is?
• 23:26
  SPEAKER_02: Certificate of recycling.
• 23:28
  SPEAKER_02: We are not only confirming to you that your liability was destroyed, we're gonna confirm to you that all of those materials are reused productively.
• 23:37
  SPEAKER_02: Because in theory, if you don't confirm that second part, then okay, you destroyed it, but did the liability just take another form?
• 23:46
  SPEAKER_02: And is it hiding in a closet somewhere else?
• 23:48
  SPEAKER_02: And guess what the answer to that is?
• 23:50
  SPEAKER_02: Yes, it is.
• 23:52
  SPEAKER_02: So um a seller beware, right?
• 23:56
  SPEAKER_02: Like because you're you're you're you're or buyer beware, you're paying, you're buying um for peace of mind.
• 24:04
  SPEAKER_02: Beware that if it's not fully recycled and truly gone, then that peace of mind is an illusion.
• 24:14
  SPEAKER_01: Well, for your fireside chat, uh a core focus of that was really your um you know monetization.
• 24:20
  SPEAKER_01: So can imagine we have a lot of questions coming in in that area.
• 24:23
  SPEAKER_01: So uh let's get started on silver springs and uh land monetization here.
• 24:27
  SPEAKER_01: So, but shifting to silver springs, uh again, a lot of investor questions here, but I'm gonna package these uh together, Corrado, and leave it open for you to respond.
• 24:36
  SPEAKER_01: So uh on the conservative$300 million valuation, uh, is that the total SSOF portfolio value or Comstock's roughly 43% attributable share?
• 24:48
  SPEAKER_01: Uh is it based on the 250 megawatt to 300 megawatt of secured gas capacity for the full planned expansion?
• 24:57
  SPEAKER_01: And how does the underlying real estate value compare with the current uh market cap?
• 25:03
  SPEAKER_02: Oh, great question.
• 25:04
  SPEAKER_02: So, first and foremost, the the estimate of 300 million was was roughing out what the value of three things are.
• 25:17
  SPEAKER_02: One, our share of SSOF plus the properties that we own outright, of which, you know, if you look at a 2,500-acre uh portfolio, 250 of those we own outright.
• 25:34
  SPEAKER_02: Okay, so we own 100% of those, in other words, plus the power um um, well, you could say plus the power, water, and and fiber access that we have in those properties.
• 25:46
  SPEAKER_02: Okay, so those are the three, let's call them value drivers.
• 25:50
  SPEAKER_02: And we add all that up to be, you know, like a rough estimate.
• 25:53
  SPEAKER_02: Obviously, it's a very round number, right, indicating the same.
• 25:58
  SPEAKER_02: And um, and and so um I think there's a big disparity between what you know dry dirt and unpowered dirt is worth, between what uh land with road power and water utility uh available to it.
• 26:17
  SPEAKER_02: Huge disparity, night and day.
• 26:18
  SPEAKER_02: Okay.
• 26:19
  SPEAKER_02: So so having said that, the the the you know, if we sold the dirt without power and water, we would make money.
• 26:29
  SPEAKER_02: So even even though the numbers would be disappointingly low to people, we would we would recover our cost and then some, okay.
• 26:36
  SPEAKER_02: That's not there's no interest in that, and there's no possibility of that as far as we're concerned, right?
• 26:41
  SPEAKER_02: Because we have power and water, you know, and so um, and so um you know, I think that does answer the question.
• 26:48
  SPEAKER_02: That's our share of everything, right?
• 26:50
  SPEAKER_02: That's our share of everything.
• 26:52
  SPEAKER_02: Now, let me go one step further, right?
• 26:55
  SPEAKER_02: In that um, if you asked me a year ago, what's the bottleneck?
• 26:59
  SPEAKER_02: Well, if you asked me three years ago, what's the bottleneck, I would say having enough water, we covered that.
• 27:05
  SPEAKER_02: You know, today, what's the bottleneck?
• 27:07
  SPEAKER_02: Um, have you know, I'm sorry, last year, what's the bottleneck, right?
• 27:11
  SPEAKER_02: Having enough power, we covered that.
• 27:14
  SPEAKER_02: Um if you look at the markets today, macro, not Sear Springs, what's the bottleneck in the country?
• 27:21
  SPEAKER_02: If you ask the top real estate firms that are expert in you know site selection for powered land for data and compute, they're gonna tell you, well, right now it's community opposition and air emissions.
• 27:34
  SPEAKER_02: Okay, so so um two weeks ago, uh Line Story County, which is our neighbor, you know, is the leader in data center deployment in Nevada, right?
• 27:46
  SPEAKER_02: Even even as far as I'm concerned, higher than Vegas.
• 27:49
  SPEAKER_02: They're they're way ahead.
• 27:50
  SPEAKER_02: Okay.
• 27:51
  SPEAKER_02: Um Lion County just did two things.
• 27:56
  SPEAKER_02: They had a data center ordinance workshop, which made it clear to us that they're open for business and they're about to approve a data center ordinance that defines it as a permitted use.
• 28:07
  SPEAKER_02: They do that with Microsoft Tract and Monarch, like all um resident approved and moving forward in Line County with their projects, and they're all big.
• 28:19
  SPEAKER_02: Monarch created a lot of headlines and a lot of controversy, and they just got approved, right?
• 28:25
  SPEAKER_02: First major phase of approvals.
• 28:28
  SPEAKER_02: They just got them all.
• 28:30
  SPEAKER_02: So we feel like we're in a tier one position.
• 28:37
  SPEAKER_02: We feel like we've got power, water, fiber, community, and um regulatory.
• 28:45
  SPEAKER_02: We got it's you know, it's it's it's what the most sophisticated companies are looking for.
• 28:51
  SPEAKER_02: So so people say, well, why is it taking so long?
• 28:56
  SPEAKER_02: Well, I hope that answers the question, right?
• 28:58
  SPEAKER_02: Because, you know, there is a lot of complexity, you know, and and and the buyers are not sophisticated companies, they're the most valuable and the most sophisticated companies in the world.
• 29:13
  SPEAKER_02: So you have to do it right.
• 29:16
  SPEAKER_02: And um we feel very, very good.
• 29:19
  SPEAKER_02: Like we feel, I mean, I feel great.
• 29:21
  SPEAKER_02: I can I caveat every time I say that, just automatically say we wish it could go faster, you know, because because that's always true, but but um you know, the value, the you know, the realizing the value is what we're all about.
• 29:40
  SPEAKER_01: Okay, great.
• 29:40
  SPEAKER_01: I think this uh leads naturally into uh the investor questions regarding uh the balance sheet.
• 29:46
  SPEAKER_01: Uh so a few questions here on uh MACI, uh, and those are uh following the June uh Lyon County land consolidation, what is the current cash position and when is the$20 million initial MACE payment expected?
• 30:00
  SPEAKER_01: Uh also uh do current cash plus MACI proceeds fully fund operations through 2027 without additional equity issuance?
• 30:10
  SPEAKER_02: So uh we had 31.4 million cash at June 30.
• 30:15
  SPEAKER_02: We um believe the 20 million from Mackie is imminent.
• 30:21
  SPEAKER_02: It's imminent, okay.
• 30:23
  SPEAKER_02: So um, and then the answer would be yes to your other question.
• 30:28
  SPEAKER_02: You know, the answer would be yes to your other question.
• 30:30
  SPEAKER_02: So we're feeling, and I think everyone will will clearly see that when the 21 when the 20 million gets banked, okay.
• 30:38
  SPEAKER_02: I think the over you know the reaction that we saw um, you know, in in after our last announcement really was tied to two very important things.
• 30:47
  SPEAKER_02: One is we deployed a lot of capital into metals in the first half of the year, intentionally on plan, and we uh deployed a lot of capital into Sierra Springs, intentionally on plan, maybe more than what some people had calibrated it would be.
• 31:03
  SPEAKER_02: So so that then you're like, oh my gosh, right?
• 31:06
  SPEAKER_02: Like you used a lot of capital and you didn't close the MAC deal yet.
• 31:09
  SPEAKER_02: You haven't monetized any of these assets yet, you know, like like feel a heck a lot better if you could just do that.
• 31:15
  SPEAKER_02: And we heard that loud and clear from a lot of our top investors, and I'm happy to say that it's imminent.
• 31:22
  SPEAKER_01: Okay, sounds good.
• 31:23
  SPEAKER_01: I think for this point, also I'd encourage investors to take a look at our most recent uh research note and our forecast, and you can see how um the this uh transaction works through uh our financial forecast and cash flow uh you know as well.
• 31:36
  SPEAKER_01: Um, but next given the uh the value being created from uh utility uh waste, um the question is why has the company not pursued direct utility investment instead of a secondary offering?
• 31:50
  SPEAKER_02: Direct utility investment, meaning some of our customers co-investing or investing in our process.
• 31:57
  SPEAKER_01: I think that's what the question means, yeah.
• 31:59
  SPEAKER_02: Yeah, that yeah, good question.
• 32:00
  SPEAKER_02: No, I think that um it's a great question, actually.
• 32:04
  SPEAKER_02: Like I think that um we're feeling a lot of interest from those counterparties.
• 32:10
  SPEAKER_02: And I think I think there's two reasons, right?
• 32:13
  SPEAKER_02: One is their problem is growing in front of their eyes, right?
• 32:16
  SPEAKER_02: Very meaningfully, right?
• 32:18
  SPEAKER_02: And and you know, look, the sophisticated companies with serious compliance um and environmental stewardships, um, they can't exploit loopholes and send things to landfills and do bad things.
• 32:32
  SPEAKER_02: Okay, they they can't do that, right?
• 32:34
  SPEAKER_02: So, so so in that regard, it now their their question went from, you know, you know, how do we budget for this?
• 32:41
  SPEAKER_02: How do we put some resources around prioritizing this to where's the capacity for this?
• 32:47
  SPEAKER_02: We like that last question.
• 32:49
  SPEAKER_02: We really like that last question.
• 32:51
  SPEAKER_02: And we're hearing very clearly from a lot of our major customers that, yeah, no, those other guys don't seem either they don't they they don't have the capacity, nor do they seem to be bringing it online anytime soon.
• 33:05
  SPEAKER_02: That we we're we're we're indirectly reassured by those comments.
• 33:11
  SPEAKER_02: Um, but the second thing, Peter, again, no one has seen a 3.3 million panel a year system operate with their own eyes yet.
• 33:22
  SPEAKER_02: I mean, you see you saw a little bit of it on a video a few weeks ago, okay?
• 33:25
  SPEAKER_02: That's good indication, but no one's really seen it running like continuously with their own eyes yet.
• 33:32
  SPEAKER_02: So that to us is not only going to trigger more panel flow, but it's also gonna trigger how do we collaborate better?
• 33:42
  SPEAKER_02: Here's we see we see the solution now.
• 33:45
  SPEAKER_02: How can we be more a part of the solution?
• 33:48
  SPEAKER_02: Right.
• 33:48
  SPEAKER_02: So we're feeling directionally, we're feeling that trend, but you know, we haven't that's why getting the machine up and running is is so so so such a big milestone for us.
• 34:00
  SPEAKER_01: Okay, and then turning from uh metals to fuels, we have a couple questions here on uh biolium uh and the biofuel initiative.
• 34:08
  SPEAKER_01: So uh specifically, is the work on track or has it slowed?
• 34:11
  SPEAKER_01: What year does biolium generate first revenue and will shareholders receive A shares?
• 34:18
  SPEAKER_02: Biolium is on track, it's back on track.
• 34:24
  SPEAKER_02: I'm confident, and I spent you know two days last week with the leadership team, and it's very exciting.
• 34:32
  SPEAKER_02: Okay, we have the only fully integrated lowest yielding, I'm sorry, sorry, lowest carbon impacting, lowest cost, highest yielding solution that we can integrate in any location that we want to for our refining solution.
• 34:55
  SPEAKER_02: So feedstock is the bottleneck, feedstock is the bottleneck.
• 35:00
  SPEAKER_02: We have the solution that unblocks that supply chain, and it's integrated with the the transition um the you know the the um the conversion of that carbon into fuel number one.
• 35:14
  SPEAKER_02: So we're on track, we were off track a little bit in the context of a lack of clarity to a the readiness of conversion and the proliferation of wastewoods all over the place.
• 35:31
  SPEAKER_02: Okay, we have locked and loaded with laser focus that we have our own lowest cost, highest yielding feedstock solution.
• 35:42
  SPEAKER_02: It's very important to say that.
• 35:43
  SPEAKER_02: It's very important to say that.
• 35:45
  SPEAKER_02: And that's that's that's um uncaveed, unqualified.
• 35:51
  SPEAKER_02: We have that.
• 35:53
  SPEAKER_02: And the readiness of our conversion, you know, wasn't ready for prime time, wasn't ready for TRL7 scale up, okay, like Metals has already done.
• 36:08
  SPEAKER_02: And um, but what what it is ready for is um major, major counterparties to collaborate and invest in getting it ready.
• 36:21
  SPEAKER_02: So we will not only announce revenue in 2027.
• 36:25
  SPEAKER_02: Yes, the answer is yes.
• 36:27
  SPEAKER_02: That revenue will come primarily from sales of the feedstock solution for other applications, energy and related, but not biolium per se.
• 36:38
  SPEAKER_02: Great thing.
• 36:39
  SPEAKER_02: Why?
• 36:40
  SPEAKER_02: Because A, it brings in revenue, b, it's profitable, and C, it establishes the the um the feedstock solution in the ground that can then be increased for feeding you know the biorefinery.
• 36:55
  SPEAKER_02: So that's a b um we're also gonna have let me not use the word revenue, let me use the word um cash sources in in the form of grants you know from blue chip, blue chip companies or entities, both, um to advance our conversion.
• 37:22
  SPEAKER_02: So um I think um it's it's very good from this point forward what we're what we're seeing and what we're doing.
• 37:31
  SPEAKER_01: Okay, great.
• 37:32
  SPEAKER_01: Just a couple of questions here, uh finally on growth strategy and new product lines.
• 37:36
  SPEAKER_01: Um I think you've already uh addressed this, but I'm gonna go ahead and ask it.
• 37:40
  SPEAKER_01: So with more uh recycling locations already in the pipeline, each requiring more equipment and cost to reach full capacity, why not reach profitability before expanding further?
• 37:50
  SPEAKER_02: Yes, so that's great.
• 37:51
  SPEAKER_02: That's a great question.
• 37:52
  SPEAKER_02: So in in my and there's two there's two tiers to answer that, two tiers.
• 37:58
  SPEAKER_02: Okay.
• 37:59
  SPEAKER_02: Metals will we believe will reach profitability at 25% utilization.
• 38:05
  SPEAKER_02: We want to prove and stabilize that for at least you know three or four months.
• 38:10
  SPEAKER_02: Okay, we want to approve and stabilize that for at least three or four months.
• 38:14
  SPEAKER_02: I I would say that's necessary but not sufficient to deploy.
• 38:19
  SPEAKER_02: Okay, we want to see that ramping up a bit from that level.
• 38:22
  SPEAKER_02: Okay, so when we see that ramping up a little bit, we would be of the mind to start deploying um uh ordering, at least ordering equipment, right, for site number two, site number three.
• 38:36
  SPEAKER_02: So I hope I hope I think that's consistent with someone with what someone says.
• 38:40
  SPEAKER_02: Now, if someone says, well, why would you not wait until the enterprise was fully profitable and you were running at you know greater than 50% utilization?
• 38:49
  SPEAKER_02: First answer is we might, right?
• 38:52
  SPEAKER_02: We might, right?
• 38:53
  SPEAKER_02: It depends on how quickly we get there as well, right?
• 38:56
  SPEAKER_02: But if we're going there and we're getting there, those are not the same thing, but they're closer, right?
• 39:03
  SPEAKER_02: In terms of decision, a decision point.
• 39:06
  SPEAKER_02: Um, but then the other is lead times of the equipment, you know, are long and we see the market growing.
• 39:14
  SPEAKER_02: Okay.
• 39:15
  SPEAKER_02: Now, even if the market grew slower than we thought, we don't think that, but even if it did, okay, um, our proximity to Texas, our proximity to Florida, our proximity to North Carolina, our proximity to mid-Atlantic, you know, Ohio, is is poor.
• 39:35
  SPEAKER_02: Our proximity to California, Arizona, Nevada is second to none, right?
• 39:39
  SPEAKER_02: So, but our proximity to the other uh customers is is low, right?
• 39:44
  SPEAKER_02: Because they have to ship across country to send it to Nevada.
• 39:48
  SPEAKER_02: And we would lose market share and lose business if we didn't get out there.
• 39:53
  SPEAKER_02: And there's two negative implications to that.
• 39:55
  SPEAKER_02: The first one is obviously our market share and our profitability in the future, right?
• 39:59
  SPEAKER_02: The second is guess where those things are gonna go?
• 40:02
  SPEAKER_02: Landfills.
• 40:03
  SPEAKER_02: So environmentally horrific, right?
• 40:06
  SPEAKER_02: So so we we can't, there's a risk here, right?
• 40:10
  SPEAKER_02: If that if we're too slow, right, that um you know, um, you know, that what you lose is gone forever.
• 40:21
  SPEAKER_01: Okay, and one final question here about new product lines.
• 40:24
  SPEAKER_01: So this feels like this is a far in the future to the question, but I guess you can let us know.
• 40:28
  SPEAKER_01: So it says beyond solar panels, uh, are there other products similar or dissimilar the company could recycle for profit?
• 40:36
  SPEAKER_02: So if you don't mind, I'd like to peel the onion back a little differently and then hit your point, right?
• 40:42
  SPEAKER_02: So, first, selling um selling aluminum, we've been doing it since day one of the demo facility.
• 40:50
  SPEAKER_02: Selling glass, we've only been doing it more recently and now in an elevating value uh manner with multiple off-take partners.
• 41:01
  SPEAKER_02: And I use the term partner because, like the conversation about co-locating or or co-investing with the customer on the utility side, there's also interest on the glass side, you know, and the silica side.
• 41:15
  SPEAKER_02: You know, um logistics is a very, very, very, very, very, very big variable in our cost equation.
• 41:22
  SPEAKER_02: And so anytime you can collate, co-locate, and minimize those kinds of things, you get a big, big, big advantage.
• 41:29
  SPEAKER_02: So those are evolving.
• 41:30
  SPEAKER_02: And then, of course, you already know we're working on the extraction of silver first and then the other metals second.
• 41:36
  SPEAKER_02: We consider those new product lines, you know, and and so that's the emphasis of our of our immediate-term effort.
• 41:45
  SPEAKER_02: You know, there's opportunities on both sides of the supply chain because we have a funny business, right?
• 41:51
  SPEAKER_02: We have um instead of suppliers and customers, we have customers and customers.
• 41:55
  SPEAKER_02: You know, we have customers on the intake and we have customers on the offtake.
• 42:00
  SPEAKER_02: So, so um, you know, we've we've already been engaged, you know, and asked to evaluate industrial tailings coming from other sources than um than solar recycling, and with very promising uh and interesting uh market segments and addressable markets associated with that.
• 42:21
  SPEAKER_02: Um we're not being distracted, but you know, to the extent where you have a lab that tests tailings, it's not distracting for us to test other tailings or testing other tailings.
• 42:30
  SPEAKER_02: It's very exciting, you know, and then um, you know, on the other side, uh, well, I guess it's the same side, right?
• 42:38
  SPEAKER_02: You know, you start looking at other electrification materials, you know, and um I would I would say openly and right up front, we have a low interest in lithium-ion batteries.
• 42:52
  SPEAKER_02: You know, maybe that's obvious because we started there and said, ugh, you know, and we pivoted to solar panels.
• 42:58
  SPEAKER_02: But but there are other electrification products that are safer and and you know would fit more within the paradigm of the solar panel, you know, and and there are other metals that are rare and or you know, exploding in value that we believe are ripe markets.
• 43:19
  SPEAKER_02: But we have to walk before we could run, you know, and and certainly having the big machine running literally fast um puts us in a new state of reality to start assessing some of these other things.
• 43:33
  SPEAKER_01: Okay, very, very interesting.
• 43:35
  SPEAKER_01: So, Crado, uh, thank you for so much for joining us today uh and taking these investor questions head-on.
• 43:41
  SPEAKER_01: Uh, you know, it's great to see the interest from investors uh overall here, and I know they'll really appreciate those details that you provided today.
• 43:47
  SPEAKER_01: So thank you very much.
• 43:49
  SPEAKER_02: Well, great questions, Peter.
• 43:50
  SPEAKER_02: Thank you both, Peter, Sean, for having us back on.
• 43:54
  SPEAKER_01: Okay, thanks.
• 43:54
  SPEAKER_01: Sean, over to you.
• 43:55
  SPEAKER_00: Great.
• 43:56
  SPEAKER_00: Uh yeah, my thanks, Corado, for joining us.
• 43:58
  SPEAKER_00: Great uh, great overview.
• 44:00
  SPEAKER_00: And again, that was Corado de Vasperis, Chief Executive Officer of Comstock Incorporated, NYSE L O D E.
• 44:07
  SPEAKER_00: Investors can learn more about Comstock by accessing our research content on the WTR website, as well as on research aggregators like Fennex and Bloomberg.
• 44:16
  SPEAKER_00: WTR is an open access research platform, and we encourage you to take a look at all the research on Comstock as well as other companies.
• 44:24
  SPEAKER_00: I'd also like to thank my equity research colleague, Peter Gastrick, for such a great uh great podcast today, and also to the producer and editor of the podcast, my WTR colleague, Krista Fitzpatrick.
• 44:35
  SPEAKER_00: So, again, thank you everyone for listening.
• 44:37
  SPEAKER_00: And don't forget to subscribe.
• 44:39
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• 44:43
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• 44:54
  SPEAKER_00: We'll see you next time for another edition of WTR Small Cap Spotlight.
• 44:58
  SPEAKER_00: Thank you, everyone.