LODE - Earnings call transcript Q1 2020

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Operator

Good day, and welcome to the Comstock Mining Q1 Update Conference Call. Today’s conference is being recorded.

And at this time, I’d like to turn the conference over to Corrado De Gasperis. Please go ahead, sir.

Corrado De Gasperis

Thank you, Eduardo, and good morning, everyone. the Spencer, Comstock Relations our Treasurer, us here, line on and Gasperis with Zach with Director today. De CEO Mining, of the new Corrado of External first XXXX Comstock’s to you welcome conference We call. quarter

our initiatives. brief a including the included this provide will press our summary from strategic I release on information of that’s from progress morning,

the please a our new in website If you of menu copy Releases on a main on today’s release, Press www.comstockmining.com, copy and just don’t have you click the will find bar. at button

We our today, report statements Form and just on we’ve press financial for the will basic quarterly have XX-Q your convenience. also filed included with release the

everyone being our been this actually everyone going a the everything this with the working collaboratively reporting exceptionally one faster that and of of and COVID-XX. actually week required were by schedule. scheduled on cycle, with able we working well quarter, over But team, ago. fastest, completed to We do working our the distancing a we’ve forward despite And closings expect coordinated based team remotely, measures had report Deloitte with best regardless we full disciplined

and that morning’s are those differ release, are These These detailed previous identify. our the statements are this not Please statements and remind forward-looking outlook. on we in to subject risks update statements current forward-looking the company may you by also cannot call, and could subject facts are call and historical in relating other uncertainties the same constitute this any XXXX press same on statements. including risks based would reports and will also statements But forward-looking to matters results an are this make that that risks me to all let that actual SEC expectations materially. and we constitute uncertainties on and during cause filed to with

let’s move update. Okay, the on to

we’re going The our in we’re developments now now about XXXX, to shifted precious have and just metal-based company all and be towards really and activities repositioned fully gold for the initiatives, really focus substantially goal. silver talking extreme driving have We growth. these an with to

plans the technologies is number metal that want processing $XXX total, intrinsic that in our with and $XXX immediate million the cash-generating billion, say larger our targeted grow and the the to goal value the million – longer-term strongly, that in we put and precious the implementing $XXX and we’ve by commercialize develop and of $X.X term, in place. gold Our to resources million, silver that shorter identified to

the initiative, That means means Lucerne and that the non-strategic that assets Mercury means south Dayton, Dayton, MCU, Clean means Lucerne, and that and completing Up monetizing our means claims of to fund that north growth. of that

the have they area we Occidental of Lucerne, gold and Lucerne and southern in reworked estimate now They Lode. essentially with as based groupings resource it’s with updating you also Tonogold. extensions the are that They’re partnered Starting of Lucerne claim some the east of that higher prices expanding represents the compelling. estimate geographically have adjacent the know, the on

they’re Lucerne Lucerne up So actually Occidental expanded very with and two Occidental better north Lucerne the Lucerne minable Lucerne combine of The And they’re surface interconnected the Mine. extensions the again, those that’s working compelling. right resources, Lode. eastern and and and they’ve now the resource east into Mine combined,

their the support that some eastern expansive County. are our and Occidental includes drilling permits they’ve also And of selection program and drill with partner. They’ve conceived lined drilling more. the these and commencing extensions Lode of that already for and up Storey in well Tono’s capital a planned received the full finalizing much

in We’ve not our Tono as the target as remarkably $XX new the value that early possibly that June, an from million, projecting Lucerne reimbursements, high-grade established surface royalties from summer, on from additional the this some leases, for will but come million be the groupings. mine expect list from at targets. $XX We a commencing we’re drilling only would

mentioned, we royalties. have I As

a all the County Storey on them, of sustained the cases the Lucerne higher. in all not claims, just but X.X% NSR Occidental, have We some and royalty and of mineral

together and impressive. more So and geological the when But be there drill plannings comes and we’ve will the be it much the the discussing programs that here that to research in we’ll near the future are geology. put truly work drill the

shares, over and know, common the of you in million Tono the $X.X unrestricted total converted own which, we majority if month, million Tonogold well XX stock, As preferred becomes this shares. would to by way, common

that prices, million. to our at current million, the position $X.X $XX closer With values not

firm Tono it that and exceed and of say forward is the valued to It’s million. valuation a more to here is that we’re very capital really work XX, much looking That drilling March come and fair date. there’s our been seen $X under that’s for starting XX-Q we’ve much lined it. little ready the reporting to at that and that’s geological expectations, March third-party now XX to commence, the the us to As getting up

Dayton, are the expanding of economic we resource. terms In

That nearly are finished together very, It’s of work nicely. almost is expanded engineering and We then an our on pit with working interpretations very actually geological expanded the done. shell. coming

we previous a price. using million, $XX and or $XX just value in just developed, just $XXX shells,- we take had [indiscernible] of gold not And to shell on gold $X.XXX value show based right put we that shells those with that an economic grades assumption. other at we Dayton using closer just consistent cutoff more $XX the a reengineering, those and that’s shells that million but no are words, and we million, the low-end around, were Dayton’s reevaluated resources if economic economic But now, if developed an now

reengineered Now, I’m shell the different we’ve those with economic cutoffs. not saying

simply the today’s gold smaller We’re exceptionally have prices, with saying something just old, and design we valuable.

work. that do to going we’re So

I’d this just don’t but value current million, the towards goes technical a say will looking that XX-XXX report million and standalone year. environment. for the to we I work up that range know with that doing to that now reasonable anything, $XXX And Dayton between is in feel what we We’re publish $XX be

we resources share. the resources, that literally the value $XXX summaries, we the implementing to list, and just just over lot, about of half to market. we in summarized. get a If When $XXX this is is million on lower and be recently, we’re and all on our be going for low-end these we we that but technical see investment We’ve $X it put as that, number developing for we to we’re gets Lucerne, on low-end and we out proving in of million. quickly Dayton blogged further asset the if our realizing talking low-end $X the summarize the of our because over a investments the values And us going these other of all what simply initiatives, well it, reports a focus share, get we’re a and

move on MCU. to Let me

July. know, now we on venture, our May, with is one mercury is internationally Philippines in for partnered you one queue. This the Comstock in the launched MCU. and two scheduled the for As domestic and clean the projects The remediation growth

of that terms and the means In processing landing materials. equipment

delayed team majority of MCU It preparations the time system making the by the a Interim Unfortunately, assembly the and of first the because Comstock of delivery had site quite of COVID-XX. for be will weekend, Site been are was the all bit manufactured and just completely that by preparations in This that. the work was now. not is parties and shutdown third underway. impressive. to coating powder progress allowed That’s was painting were it do that system incredibly The system. and

looking two single just MCU We’ve weeks, the supportive. meetings Nevada I’m with NDEP the forward step in it’s progressive, the last startup in really least three to Division the U.S., way collaborating this of and all had with it’s Environmental Protection. all of every

here. excited I it’s about what photos we will the think about gets But on arrives posting website. up it be do our as and are new of people impressive. system certainly And we’re genuinely set to

Philippines, think, weekly knows, as and also Solutions, enabled I has definitive them, our agreement venture working and the been we’ve with already set Clean with up, things signed everyone partner Ore ready-to-go. a getting MCU, in joint

being up all branch it’s organized Just a the business, and do to of setting expeditiously. logistics foreign able happening getting and

restrictions, agreed also to require we’re to and restrictions there have about there Up those with excited things this until recently already for the The to sand the quarantine Mercury remediations May But the two to have of scope very project, and those prior enhanced XX, weeks, if the start not lifted. going combining project because you we’ve that go get and system. you COVID-XX gravel Philippines we’re intentions so we Clean by

is we��re which a we done similar collaboration with happening, it’s to us, Oro, really Philippine system by creating by mercury because and in built in for very in of a authorities, July, bigger. to was the that although speak environmental we’re building Comstock, that targeted and system, bringing onto This now the regulatory one the breakthrough for being addition right as delivery very, kind will the here in be remediation

environment the it actually that that And definitive really that and is mercury will and and flow gravel stream then What for we a with technologies. means and the first sand goes, certainty. operations, creating sand be which comes really system, second a remediation which a also revenue system, that We’re the just adds is have that, the mercury to be will a designed in profile. we from know cash from gold is the just enhanced definitive is gravel one but the operations, any

the how sand to we also profitability system enter that the be offtake essentially without and out ensures and expanded So doing it get of an of to amount come we’re to guaranteed reflects actually meaningful of that business, going gold quantifying of what and into gravel of the we’re going would process. a have there, running mercury certainty allows this that up of that derisker scope because and

our built we’ve that $X,XXX systems model on initially gold. entire these Overall,

just price begin gold we higher than of time better to processing can’t with at think $XXX it now, a extracting them contaminated the had So and these from materials gold a been.

our bit about to me position Let a we’ll questions. up financial and in then talk and turn wrap outlook, our

of $XX total our XX, balance almost million. we sheet on As of March had assets

record. I think, that’s probably a

to Our me, XX say. least roiled, and moving the slowly at markets to next forward. we’re Silver let’s sale being excuse coming within obviously, held they’re They’re Springs likely XX most were now – and COVID-XX We part by close The stability, back quarter, lockdowns days. this for assets are that. expect to the of

raising So down capital the funds that slowed a opportunity bit.

the the including in on But the processing focused weeks, facility year, on into hangars that Springs assets already manufacturing coming had fund last break airport. the month the clean companies the over has airport. And acquired first the facility, two new manufacturing Silver six including its was to last meantime, the ground the the lease also fund tenant, or first been able and building on

The were planned that these leases Northern manufacturing, validation we the rates signed Springs recycling-based that in above place Nevada thrilled at. thesis were models. were companies, impact were especially the we at want our had to were at remarkable. that companies, is Silver this Frankly, the base the and that conservation-based and of what well They themselves

We’re explicitly working want that and into companies, of midsized zone. large opportunity frankly, handful small, traditional a some, our to with move are very

So, despite the of rocketing the slowdown, been money company the second tranche raised not because forward. having COVID of has

rates, lease a fund million. cap manufacturing lease paid when Maybe – the of We it $XX perspective. little acquired valued to that $X.X on million. modeled we an facility, in let’s X% put about rate it and than the expected rates based less say, acquired When

was idea value. incredible the an at facility exceptional we’re an So getting

talking use facility. with a of same over $XX you if and the about rates already cap But signed for million valuation we’ve just you’re that current that rate, X% that secured, sealed, lease

So rest that’s it’s a now capital-raising leap accelerate going activities. to forward of our and the

on And is with leave getting is for $X.X cash closed, least the more pay the that on. know, us million everyone in more just investments will is much about Comstock funded obviously, properties as move off the anxious our the asset immediate $X remaining so at closing you fund two and all debt of two But the much than Comstock acquiring bank. and and properties making those fund our be properties. we can sales interest The million

position for stock ability stock month. telling had unrestricted us together valuable earlier it I The I’ve million us, is us, moving should just And that value is put really into people other the a of becomes Tono that be. to us remarkable $XX stock intelligently program. for impressing becoming potentially $X mentioned look monetizable more highly to million, about Tono pretty with are most already drill call. if this you our what their the in at and talked

well. upcoming they’re us We the first reimbursed cash monies appreciate so reimbursed expenses in very some with about in supporting includes expenditures, permitting, during and even federal additional we’re incurred anticipation staff, of that quarter, local the also permitting, extremely They the that includes drilling. $X.XX our geological fully timely exploration million that. for because They us plan includes that the that some of them and support with for

be Well, is now. certainly closely haven’t working from them So that we working almost XX% been And have receivable. is it. by with note due closely which than interest That a we million. more component Tono receivable with been associated we formalized did couldn’t note with to that also the has number remaining us regarding them. more we Lucerne, formalizing We $X.X a ever

cash billing That’s in income to continue of March. not the now of about are have And the a stock a just us and allowed past. did that sold bit receiving starting little month, that month sale at was receivable. activities We end from the $XX,XXX note last we

Our XX,XXX,XXX. number are outstanding XX. the That’s That shares number was at today. March the

me our outlook. So with summarize conclude points six just just bullet our and of – let

days, hopefully, this the $X in to put the million, $X.X Springs XX get the one. That’s assets, the one, quarter, Silver number in cash number on remaining next the debt, close So extinguish the of bank. million XX

launches moving They’ve program. It’s permitted They’ve planned it. Tono exciting. we two, significant Number a It’s month, happen their going That’s it. next very of drill already portion forward. to already believe.

will this ground operating finally That’s us, the It system quarter. the MCU getting this a be for Number on month. three, operating. system big land movement to going start forward to going we’re that and

gravel the the in July, the the unit we’re and MCU going of mercury-enhanced four, Number before to end second commercialize hopefully, with system and unit first to sand second a year. follow,

we planning geology five, to our getting our finish number line the and – the resource. of expansion – really XXX% Dayton We closer of the in are owned

we we economic an can publish our update year. it XX-XXX updated estimate, later parameters resource can resource that and So start standalone Dayton around this putting

a that just mentioned immediate we we goal just blogged recognizable of us our But I I by unlock earlier. much – measure that know, to that’s as horrible undervalued a we’re and that from where it are regard. and is driving now. not milestone lastly, we’re I it’s And as that. XXx value see $XXX to million. we know the just focus, any in almost

of technical, and you’re and push things that going the are activities it be that that immediate it support in that when monetizations to the of growth doing generated, that it’s reportable, follow, are from grow are But the gets and the all out that kind tangible, that term layer laid in then projects Dayton, from we’re be clear. number, effect, and will the continue the cash to to and money we that and continue but MCU it the

and So value the sharp, happening. it’s realize focus clear and is the to it’s

please. and turn stop to going I’m to think, there questions I Eduardo, So and answers,

Operator

Please We’ll ahead. our from first take [ph]. [Operator [James question Dell] go Instructions] now

Unidentified Analyst

Corrado. doing? you How are Good morning,

Corrado De Gasperis

How you? good. Doing are

Unidentified Analyst

Tono the the to preferred stock, [indiscernible] can convert regular? over convert about can Talking the Fine. we you

Corrado De Gasperis

No.

it’s as have convertible. we we’re said, May XX. allowed convert $X.X – you So million it not preferred, to of not And until

So coming to a you. theater soon near

Unidentified Analyst

No you problem. out and that all income of That’s get another help source that. of debt will

part access have as Okay, Sutro the does their agreement? of Tunnel Tono to

Corrado De Gasperis

question. Good

of Tunnel, Sutro tunnel caved the which immediate City. it’s originates the of at now miles entrance that down think so is – in Virginia about Dayton I X.X feet accessible, about the XXX South term. in but in The

entering of not it would no. a terms be safe. in tunnel and stance using It’s in the play So free-moving

and Occidental for high-grade accessed like XXX grade, way maybe, that show to both right on to X,XXX beyond up underneath the information meaningful has meaningful feet. is lengths depth let’s Virginia goes historical meaningful it way And a never X,XXX, X,XXX, its reports have feet. identified and we the prior City. from at grade, depth. that, said that in they been Occidental That Having any And say,

You little. at very, feet, very it’s might have but a working XXX

there’s depth. there’s at So we at grade grade But there’s have surface. point is that, evidence We huge grade that the we know intermediately. know

So…

Unidentified Analyst

Okay.

Corrado De Gasperis

regard, necessarily Speakers]. data, access I’m entrance So that term like human use have in [Multiple going the tunnel not but to we to,

Unidentified Analyst

asset apparently Can to that we It’s lease Tono generate part contract. to capital? of your more Tono

Corrado De Gasperis

the leased but And money and in you, that it’s leased going will incredible have going misunderstood we Tono. paid have we do huge claims from ground create yes, the it’s may I – we have an So to think that, really monies it’s but represent Occidental partnership. We – some the value. to get

Unidentified Analyst

Okay.

access and a get whole can it operations Tunnel, out Now mining Sutro their their easier with else? Tono, make it they the lot could whole if – whatever cleaned

Corrado De Gasperis

Yes.

Let one just point. Jim, thought, the me expand

Okay.

ahead. So sorry, there’s go meaningful amounts –

Unidentified Analyst

The is isn’t contract, lease one Sutro Tunnel part it? their of

Corrado De Gasperis

No.

Unidentified Analyst

else that’s could you is Okay, something I’m saying. lease, what

Corrado De Gasperis

thought. debate Right, good But a mean, help It’s the good adits, access good but it’s – yes, it’s potentially, Sutro it efficient just – number even no that’s But more further. facilitate There’s exploration drilling. safety issue. of thought. so Tunnel, point. a could from and apart to I one reason sort and to a is underground any the

Unidentified Analyst

because us Okay. and if us the about And string with there clearing not before last opportunity I then just cutting fund, to around”? sort off, the thinking Springs “jerking paid they’re moving for other properties them they drilling be on my question think should Silver is you we they’re someone out else, of

Corrado De Gasperis

No, no.

question, fair So it’s no. a but

priority $XXX,XXX in we’re So queue and they’re – paid already the escrow. in the they’ve

But very it logical and and the here. line, and footprint. that are Comstock the as of facility circumstance, assets, the have sequence just will acquisitions, the airport next right, first. had secured manufacturing happen operating the pressure We there’s to strongest and The agreements in a the be those properties give

But a I more patience. a everyone’s little to going patience extremely So be big bit happy. win-win taken and It’s to think understand. little more it’s I and think forever, a be going I

happening. all it’s So

Unidentified Analyst

Okay. here? folks I your Why forever third losing of first the the is you tell thing don’t it missed Last are took conference for your your dial me to stockholders them call that presentation. so in, patience whatchamacallit,

to Your correct? a – the with up Am you’re gravel MCU it clean use both cleaned-up and sell you going operation, start I gravel? a after pit it

Corrado De Gasperis

me No, explain Thank you better. it’s question. for let – little that a

may about okay? misquote there So say basically, expanse. along the I’ll is so XX-kilometer-long XX-mile permit – and X,XXX under I are area sorry, like expanse, – is this, I’m all – miles the conservative be And there and a literally

the along alluvial mercury contamination. the surface soils, along along horribly and so are And activities, river the is mining polluted. all It’s

we and the in you The and huge alluvium, will mean, a both literally in alluvium see I the gravel, processing U.S., a from process and the that that will we’re have format. the river. cleaning is taking And is one be landing even and basically riverbed the surface sand, that amount in here it. processing there the of material we river, of in wet alongside it

mercury et soils. higher system, it’s surgical material terms material, not number the there extract the volumes in but designed that is designed primary the more objective separating comes cetera. In to for material, the that river, clean mercury, of of one of contaminated is clean the residual right? out, All out the be and getting It’s the to that,

and volume. the such the same same of system at with it’s a created we’ve a So higher expanse, spirals, volume materials. same We’ve soils mercury but soil separators, the controls, because gravel riverbeds XX purposeful and and what higher done, kilometers an it’s

system, and maybe are amounts even But in of machine, massive mercury going going amounts sand say, and minimal minimal that gold. areas, where meaningful. to there’s of and, we’re let’s that be to in gravel So amounts

volume of one will clean purpose sand of mercury gravels, and it clean the And with have some on you’re and put a one So much, processing purpose capturing, then to capturing other going and systems, the and out the still primary gold. lower gravel primary much two soils but still with some scale.

and the gravel. sand So little of going and mercury be a lot producing a bit to we’re of things, one of

gravel is one sand to and little gold. other a lot and The mercury and producing of a going of bit be

there’s heavy a and amount gravel And is to it and material the such it’s that for we’ve need done and that, their projects, in coolness they’re massive so contained highway sand off-takes committed the the and of such the the of securing have and still – just construction we still, despite thing – damn for there’s taking construction-purposed that the but metals whole there’s and just – because mercury, that the mercury such that the government’s all knowledge road the a nascent, sampling of despite it even right? de-risks we the

be sampling, project, makes – the primary it money, we land able and that to it second accelerates way make in system more first it second ready, to in bring the and intelligence, it get profit, project the actually also the system. unit, generate the So continue whole it just deploy the gravel the sand system with makes safer but

it hope I explain So that a little better. helps

Unidentified Analyst

Okay. it And how dry when out of the… comes is the material

Corrado De Gasperis

system right do it’s right? and ultimately, for will and the water but construction Yes. that, will initially in No, targeting question. intents that a it’s And it’s So system. uses not. purposes, it the in the I mean, gravel cases, But I’m for it. not process and most for that prepared and and wet be sand expert a think wet to some wet. we’re ready – capable I in It’s be

Unidentified Analyst

dry of Well, coming out asphalt-ready. what for, hoping it I was

Okay, and that and ready-to-go asphalt asphalt for your something link-up to? in build other sell words, it wanted plant own you sell you can

Corrado De Gasperis

Yes.

which that believe, differentiation though, huge. that we – those – number that, is one one so our Philippine is get mercury will is partner of a our be partner, some to our out Our wonderful and number lines the of partner want sure. the the complement, of I businesses, emphasize, in I environment, could for metal mission, already involved

Unidentified Analyst

value And you’re here, okay? creating

Corrado De Gasperis

Huge.

Unidentified Analyst

to talk to you’ve you for about got it. as create paid get you is I value, Everything

So…

Corrado De Gasperis

I alone counting is I Yes. in have stopped the at unlimited. sites U.S. mercury contamination. here, X,XXX The market, mean, that too,

telling mercury cease UN’s for accord a And it’s but activities, actually us miners right? industrial believe in we’re so people that it and to – the So in or a targeted XXXX the bring mercury to using priority. leader, and is was world, using in The in like up. issue stop and the it seeing countries not, global mining XXXX UN it’s to to signed a Philippines it, clean

Unidentified Analyst

Okay.

Corrado De Gasperis

So the beginning. beginning, just is just this the

Unidentified Analyst

but that as of sound may this gravel and you sand And able off-product And and because a keep it people. a hopefully, – value. is gold, is way of of an still accumulate valuable your your at My and Yes. mind rid to in silver some valuable sand gravel open, clear as you get this, it sell and a be sand just should find as being way, not generating point to has got gravel, material, as that or to lot and will time? eventually you’ve and the get so same it

Corrado De Gasperis

frankly, for "Why be met, going they just one with Oro and we’re Paul and is. has And asking and Quite question. gravel?" order signing the and – and I Philippines, in sand I’ve you, had right core the heads, building and talking I’ll a might competency will away I I – the sand and the that’s said, just the gravel get I us, compliment you’re systems, of the by Thank our lot to kept Jim, saying miners sitting okay appreciate best Industries that, of you don’t competency." ever "Look, alluvial not not processors it And as provincial there off, that, in switch epiphany,

like, rest said, And material the And again?" we that "Well, if history. was "Say from what take the you?" they then But I’m

own XXX%. we So

permits nine now. have We

sand partner permits the Our so has all for we’re going for nine entire and gravel expanse, that it. along allow

including makes I so just much news. That’s the it So update and expanding material, scope we’re that’s big that, the everything that is think safer. and the

please? So Eduardo, question, next

Operator

from at Brigham Brigham now Please question go Investments. We’ll Yes. ahead. our take David next

Corrado De Gasperis

David. Hi,

David Brigham

Can Hi. you gentlemen? me, okay, hear

Corrado De Gasperis

Thank I you. Yes. can.

David Brigham

On the mercury getting you’re the and the I the out out gravel, of tailings… gold mean, that of

Corrado De Gasperis

Yes.

David Brigham

Mercury it the that it like what liquid. mercury? And Is a at end? gold does What recognizable gold? as What is look in? is form Is the about mineralized?

Corrado De Gasperis

Yes.

Thank question, great So David. you.

in most its is and purposes, in mercury, intents form. liquid So

waves, element. not you the your And only have drill some uncommon. the liquid some onto liquid come in if could you down it’s silver ball little and that’s bedrock literally mean, okay, river think I you a of in to Comstock hand, I

And we which reactor. so and mercury it technologies that separators and centrifuge, very, the very, very we a very mercury effectively, we that It’s – it’s a then have have, spirals call a of more the effectively, we solution, effective standard which the fourth soils. mercury any have than And in separating light-years is I mean, then an from terms the in industry organic technology. the

three then process have this gold, that the biggest have not organic only We big engineered solution think – I we we an and to but is the technologies, and – separate us – allows ability the the high-efficiency liquid technology the differentiator soils. of you we is the to convert if will, just – separating also not elemental mercury, methylized have mercury. mercury effectiveness, the effectiveness But of from

then water Comstock. you’d itself very That’s rivers. because typically, the will common, expect. when down So problem River what the down a in if wave, a find it Carson it bedrock. of And like it’s Gravity takes is happens to mercury mercury enters the pools, environment okay? is it

as could long fish. biology, when It be organic be thought with So be enough, technology, could into mercury. the soils, will has do – of but can elemental it if it return; we mercury stays and it point in breakthrough we that can of And methylizes, it Well, environment and could literally generally in the the plants, materials. no absorb convert it itself will that’s That’s you’re been back screwed. the methylized it methylize. into the

it fame. claim without works, we the how that’s black the be technology be it that’s – but can’t we’ll protecting works. filing we’ll it to box, our actually for and going into So And patents, describe how

So…

David Brigham

a does have – it something? The industrially value or mercury

Corrado De Gasperis

No.

most for represents storage line some in this the But mercury. business Okay, cost purposes, highest applications entire model. yes represents There the – of and and mercury the and no. it are disposal in intents and

is government agreed that us government see the the right? which the the Philippines, be eliminate storage, don’t the reprocess it That it environment. the in, to mining want the to agreed and the back and into mandate mercury has the problem. inconsistent go to would to the handle mercury. critical really toxic for Accord, with Minamata disposal, In example, of That’s UN’s was We not back the it, the storage

way some disposing of to to mercury, it back they’re get potential just we’re but of of have environment. And safely into ideas the the the early responsibility right we do too manage future So trying is about it, not and cost letting applications now, talk what about.

David Brigham

subject little the bit, Tonogold… changing Okay, just a

Corrado De Gasperis

Yes.

David Brigham

and going a going to get be produce need for big guess, chunk they I production. financial they they’re gold? examination of of bucks a know they path? where Do statements that your they’re to the have talking to their to clear into looking capital do to get big In them,

Corrado De Gasperis

good question, call, on I said have press They’re in not a and audited firm, release have they’re other that, top of a completing with think working say it public fully of to I made I But diligently the Yes, very fact. is did might think the schedule financial full a audit one accounting me thing in Marcum. in statements.

and with and members. full They’re their have a planning – and then independent evaluated Board and themselves to entity, to And upgraded become filed they’ve investment. reporting I a also they board file driven XX-K on already that exchange, York, coming by And one. major uplift capital say, a of all of, onto the would activity more hopefully, be they’ll professional towards wave a was but prepared New

for the very prepare steps, to of would serious attracting number now resource-expert taking call they’re attracting that, very funds, and what evolution they’re themselves one. I So logical right, funds. They’re

Number program. your for question, about million lined two, up, capital and is believe, frankly. of what exciting, really $X Really a they’ve quite drill commitments I well-thought-out well out thought to answer

in drilling, million we they publish And that $X the spend next million, that have. $X will to million, months so I what in that think them do report will technical is enable the $X them see XX

Lucerne in will The is will I better capital purpose. mind, to company. think update, a report that then and production think much they valuation my paths at. it which looking the and to for be revaluation about of in represent Right? the to think next then And or will, great. a of posture I to agrees aspect expand them what lot as have they’re technical And what a central But that that geologically also will

do expand out. which a per drilling ago, priority concepts tremendous amount So their certain first laid first speculative on data. in those the their than, to se; year-and-a-half they’re words, will that prove geological historic a amount not other to of concepts of be meaningful is different based And let’s priority, say, they’ve a are footprint,

out define safer. of and drilling But riskier capital, calibrate to because it than we’re what concepts those much things they think doing we they exploration certainly a will than anybody’s a prove production, my be some if about. bigger program, will in what be that talking shortage drill Yes, proposition in opinion, out, right? the are won’t There is look

data. But segments to there’s big upside about it with comes it and capital very excited are of when there’s it that

I – them. network And data-savvy. are what a a – it’s so And but like super working extremely what some advisers, doing, that geological big – they’re they a think been small big engineers company, becoming with what they’ve of they is doing have competent have they

exciting here very very we’re some now. in going speak close but next there’s nine, coming them, news for I months. the three, to be out Comstock of think XX the can’t I six, So

collaborative in together working way. a remarkably We’re

come over it’s XX circle. evolved big months. a It’s last not tremendously So just it’s circle; a the

David Brigham

Thank you Thank you. that. for

Corrado De Gasperis

David. Thank you,

Operator

We’ll now our next… take

Corrado De Gasperis

Eduardo?

Operator

next question take now go [Harvey our Please We’ll sir. ahead. [ph]. Molca] from Yes,

Corrado De Gasperis

Hi, Harvey, how you? are

Unidentified Analyst

you a targets the Take look Thanks. strategic at Good. value that have…

Corrado De Gasperis

Yes.

Unidentified Analyst

Back at million. that looking January $XX was on valued Dayton X, We’re at at $XX million.

it $X million each year, to was up XXXX. at $XX Clean categories. gone And The Up it’s Mercury was in valued – for million. back have So of million this January $X million those you $XX and of

that? significant Can address both in So you those. there’s some shifts of

Corrado De Gasperis

Absolutely.

talk economic over had ounces of on what grade. I an that a number ultimately, really based XX.X all shell one with just cutoff was was fill $X.X prior on path high million terms hopefully, to – – excellent senior was Dayton, of per that it, because in designed. It really evolved is I about which and average want an to so outstanding me let’s ton, want grade based how billion. That the be very of Let’s average But the our about on a really is quickly. that engineers in economic shell $XX talking and we – it that’s let

flow of the years, a but about not as showed it’s from NPV a mine So $XX say, life, million. X.XXX, And cash we Lucerne, it okay? economics mined at the almost net $XX the relatively XX% The by that same quite million X.X number a exactly double, higher. comparison, about number; short so is the about let’s

I Geologist, Chief data discussed additional Our Larry did of that Martin, work. just on doing has a drilling additional we amount remarkable based been with you. work since And that and what is

have footprint has expanded there been He done. adding the So geology, what building plans. adding has cross-sections He Larry almost we know. level of data,

get in equation my geology only Mike once the cutoffs what’s to the change because the our add prices. work for engineering gold mentations equation, obviously, on done, rerun pit will shells, then that And with Senior will okay? the And and he’ll to Engineer, that’s the not he economic Norred, based to done, all optimal

smaller "Let shell. So said, just in my use I mentations, me the

me are the more $X,XXX Let to $XX number And that and functions $X,XXX." the conservative slap use the just $XX on million numbers from went million.

it simple answer. put field. see $X,XXX what using or $X,XXX, just price thought yet was And opinion, to the I a I the think but that’s I gold it my was in So prudent. prudent now $X,XXX, people in it’s on a don’t

Unidentified Analyst

down million $X go from did Why Okay. mercury million? down to $XX

Corrado De Gasperis

Yes.

way, example. million say right? the difficult, Philippines earlier, $XXX at be I didn’t not target we’re but have So think, mercury, case target will to and did Meeting, the projects It’s Annual that as was value. idea first the still And going at when projects this of this I chart, use We’re I is by it the and case, going to that least an still right? it the the that

running we’re ownership We take interested MCU in $XXX for decided participating, that Easily we’re project the XX%. with were gravel sand our the an life XX targeting on But to way in get do okay, we talking maybe XX if million. area we nothing, a about is years. structured years, yesterday and we not if easily easily. And that, of MCU

to project me, value to that’s, should every accrue So Comstock of $XX million.

in the actually And ownership right a have have direct of first the say, first like in to then – okay? but XX% any to "We getting We refusal right project, we have would XX% of get So technically, more to MCU, have XX% one other. you’re XX.X%. this XX%." do the and involved then you more directly and XX% and direct be through

the that’s $XX.X million. So

So that was conceptual.

two projects we’ve coming. We and between million should So million correct. know $XX.X look, we still be $XX got conceptually. And that’s

going have economic, going the million, it’s However, we are it’s agreements. do And million, exciting, that’s in going XX.X% good. right? be ultimately, Philippines, XX% But looking example, to $XXX of it’s of XX.X% really because now for propose that I’m to to but – direct, we we not $XX

asset $X have So – in asses value the the metals is systems $X those in what million, would I mercury. – that these project. are even value even is the asset did we is we That’s That’s if Philippines, said, magnificently the the surface area, a there by systems mine the minimum. was The placer that, of alluvial a out asset are, mining way, weren’t all now mercury known "Look, value mercury-contaminated no I million. or if

we purpose we’re using is weren’t there point value, for specific that assets the the using these for. even So them have if them

be, I’m our the asset just And at So putting percentage high-end, believe the and the nil, putting I low-end, at it’s will then value. what of I’m project the right?

with could in conservative of So grow – Projects and the but I’m $XX I to more grow specific thing. minimum, we to hope two be being data. time those more, hard that millions. a projects from XX not or expect just as year mercury financial now, over data hundreds $XX.X – that a all more of – minimum is But as more there’s maximum. have to on million learn I listed we so million

Unidentified Analyst

and $XX and don’t $X at million you’re just I Yes. understand million at million. now $X per why you were

Corrado De Gasperis

of biggest what sort we’re it’s have now that to out I we more the of exactly opportunity. lack are signed, proofs outside I’m to be how with we just MCU, targeting, going of and precise, be a is a But want were as laying But issue, be because I more once tangible, – our of manage the is out to the to and market think, technical what operating, be won’t we growth, right. want just concept Yes. agreements targeting. there more get that I we getting

Unidentified Analyst

If the page, Okay. million. and from the you’re $XX liability you over $XX is in showed of at that obligations the and we million we’re showing at assets, significantly million and up that looking shift assets $XX.X to January

Corrado De Gasperis

a values more net that bottom I the And think I what shown like would that was be assets So ironically, at Again, conservatively, in out, quite the frankly. of there those land that – of liquidation theory in previously of I was chart. changed Comstock worth. land number sort mindset, I the and almost our took profile

monetizable. put there what known So that did was I now in and assets are

we’re So receivable a investment we nothing in asset do debt. to and some mining also selling, a have with Tono have But they as have from and that assets have the know. that you is we our platform Tono monetizable

investors, say, ridiculous the And tried "Look, than tried cap, going to I we’re this at calls of I’ve it’s just surely, that higher be other XX that to the as our into actually, types three not and to value with they I their but that about more I And know me is questions. get pound to and net they this money get." you it. values So heads these market. asking market and is just pedantic slowly, least speculate want what money is they’re had And like around yesterday, and hearing

going this the to pound I’m market. So into

Unidentified Analyst

I understand debt the don’t to million of the Comstock million Northern the liabilities. $X million? of of debt, happened $X.X understand what I but $XX.X And

Corrado De Gasperis

Yes.

yes. – XX the So

million is of million okay, debt. liabilities the the simple, in okay? that $XX is $X.X So reasonably So

any is million So reclamation that’s $X pad, with long-term we about kind as not the have near-term of We cash the reclamation leach – liabilities, that which view associated okay? liability of don’t obligation. that

reclamation is have some either million real $X spending of $XX million is that’s that other and is $X So not the Tono liability, you them, have which debt – liability. deferred a so $XX And in just the you so liability, it’s and the from advance of million expenses we received million. it

we until And a have we and liability balance to clean. the close the accrued deposits we which million as we for That’s actual a on simple then payables show just then pretty have and MCU, couple pretty And of sheet, transaction. expenses. have

Unidentified Analyst

And to debt? the what Comstock happened Northern

Corrado De Gasperis

will. the not an arguably, obligation, million. is It’s because about Comstock you a sheet, a Northern So, of obligation. type balance kind on if lease It’s of $X.X real it’s

And so guaranteed XXX%. Tono for that reimbursing is has and us

gone. we So radar the on that also deal, will close not But it still be right technically, of now, obligor. now. that on be we’re we’re any Once right the But gone. paying should substantively the legally screen, Tono because it’s Harvey,

Unidentified Analyst

of Okay. to by outstanding? have shares. XXX,XXX shares appears number increased How about It over the

Corrado De Gasperis

Yes.

issues or a going had sufficient wanted with math, I placement a July, to until even small March, the get conservative is of liquidity the because my wouldn’t asset we sense delayed had a I end by that that sales what’s didn’t were couple be sales. to to that make did thing by we we to the had and of ensure if strong to which And June And this at So asset end sure happened. of we close have the just be that. any we months,

see in do near-term more don’t the that happening and And but have some. we did be terms of there done of smaller in historically. anything I any to out wanted they’re we’ve all, to So at relatively transparent. I

same the XX,XXX,XXX shares number the and number It’s at XX. have We same we’re that March projecting. of the end it’s today,

Unidentified Analyst

comment are based at on buying our on we – question. back Last own this the point? Based stock not why valuation,

Corrado De Gasperis

So…

Unidentified Analyst

is stock It’s The worth a XX-capper. really $X.

Corrado De Gasperis

The There’s good we look, to is But one liquidity, right? close The and two we’re to I first be okay? think answers fiduciaries. to going which is is asset is second sales. these the answer, the that, stronger, question, liquidity one first on have

the system. mercury going land We’re to

there data. have is would. and publish that we if don’t the we over, then we value that to going bank discretion And cash get We’re our in

would, think we approval. I’d I think, I get have board though to But that…

Unidentified Analyst

yet. approved not that the Board So has

Corrado De Gasperis

happen. show the get say, foundation market that frankly, solid stupid confidence a But stock A, is did going the D approve all of valuation, A, real we cash would and do bank it’s it’s if we’ve some happening. D bank. that we But conceptually, we have the to in C I B, get But everyone and the and buying in paid back to it’s to then C the and at would and and and have it’s and for B, and that got cash It’s think really debt that I frankly, and, the and off; think ourselves. the value get and done

Unidentified Analyst

with Okay. Nothing the happening bank?

Corrado De Gasperis

or look five people within of at it heard And – weeks. and and couple the last interested, a had four that’s back. had we We they haven’t we seemed but

we And forward. remember, it’s revenue think loss We also then had the become it and carry with an inquiry at about coming its value operating net be the asset leasing so nice whole sold that the for going to a isn’t worth, us. other of to to sales line finish could facility, have stream million – here, we’re if it everyone, we $XXX

for almost So system, any the into us, we tax-free. intents bring and all is purposes that revenue for

Unidentified Analyst

the we Dayton? pay did for What

Corrado De Gasperis

ended entire the acres, we the So XXX whole – extra it just plus as wanted that the that we that XXX the and the were wanted property reason $X.X up claims cost it, came plus thing, us acres between was mineral total about of the buying a because mineral facility, claims original was really about and million. deal of we package

Unidentified Analyst

it sell $X.X for million? you Can

Corrado De Gasperis

sell it for million now. could right We $X.X Sure.

Unidentified Analyst

And back? so we had to buy the stock

Corrado De Gasperis

offers XX the like $X.X in the And it land have acres of million. people. we’ll $X.X right four we now, any free listed be XXX we So two and that acres get, for on for million talking pieces to buildings

So we’ll be engaged.

Unidentified Analyst

better back. off we and what blowing buying I of stock our it think, paid for return. better a it Much out you’re shareholder, As

Corrado De Gasperis

Yes.

what bank, then the if it very use the So for becomes could first paid an then, we and to it, done out that it the other blow get said, debt. we as option. pay off would cash our we of have then and for I And thing be we in

Unidentified Analyst

Okay. appreciate Thank it. Corrado. you, I

Corrado De Gasperis

off pay That’s the first, to right? have We obvious. debt

Unidentified Analyst

understand. I

Corrado De Gasperis

Yes.

so you So much. Thank Harvey. thanks,

Unidentified Analyst

You bet.

Operator

question from right. [ph]. now our ahead. [Jeremy go All last take Harrison] We’ll Please

Corrado De Gasperis

Hi, Jeremy.

Unidentified Analyst

any running got through system of the for I Have the samples late. got numbers acting gold the as you know far NCU, on talked all numbers spirals. guess, First of you small guys far that is question. as, about content? kind I the But through started don’t as if sampling I as any ran on up you again.

Corrado De Gasperis

has been I we’ve been modeling that range, would What conservative been grades Yes. ton. would say per a very, are modeling very we’ve meaning, say, I is gram X.X

Unidentified Analyst

Okay.

Corrado De Gasperis

ton. three, gram there’s got in okay? feasibility of that And per two, of least per And I these grams ultimately, grades ton. some seven in at seeing jurisdictions, believing that we’ve we’re range, and five, think X

the So here’s when incredibly grades Comstock, say, – range, gram-ish in But of we’re start say. growing, it for pulling the gets lower-end we and ton. the the per something didn’t exciting I’d because of sort

it’s obvious, worth saying. but it’s I think

thing. If a It’s if mining, you compare you art, that it’s there’s kind compare jump alluvial mining lost a lost alluvial out of hard you rock two or will. at like which to But if things mining, three right like you.

It’s and sadly, millions if One is tens, not hundreds to dollars reserve, resource, build a usually years, not lead a production. XX right? mining into and hard if business, rock times then of takes to right, process And tough eight are of prove tens, millions the to it. define of bring facilities ultimately, a to something of and hundreds dollars

$X entire when the you with mining Alluvial system. on average, million, MCU say an And system, $X I have million.

a you a lab, system. $X throw the easy, at impressive, water month? technologies, have you thing okay? And have is you off okay, a Well, X $X portable mercury grams, million. could metallurgical million You have this And it easy, retort, have

time, hard our So if don’t over we to the a it. low rock know don’t competency, the the like I’ll affair because right? throughput, core fast and but be mining, hard I love gold love or I it day cycle and capital, I’m And with take guess, that’s return speed, the disparage I have I pit right?. open the weird, any all, underground it stuff, at want

going risks, the easy. And cheaper, there’s is But other cases, ways well the there? of to is how amount get are that’s obviously. to if at some you there The and material one be in answer faster, it sample biggest can confirm

got contaminated piles of stuff. just You’ve

as and get In the us cash as easy. our gives you’re And sand it’s come while the next to we conventional it business is and component gravel gold. in really a stability, because other that’s wonderful cases, mercury the not why all allowing of river, a for where evolution, upside

So I could, point? does that best at answer the this I question, guess, as

Unidentified Analyst

I does. ever sampling if it Yes, was you actual I numbers know would are just guys in that. from we the any get phase… curious

Corrado De Gasperis

we’ll up of the Yes, as in the the we’re the soon system out, we’re supposed is place the in, getting efficacy start sharing and doing it’s the running, do. how it’s regulators things system, all grades grades as to well with everyone and that that putting

So it’s coming.

Unidentified Analyst

Okay. a just because a going [Technical And I’m was Difficulty] – a have it changes, financial clarification, to thing?

Corrado De Gasperis

too, because We, the spread down of simple sort two No. kind two everything of slowed simple down, we window, to, the ready. out make time, – it sort we doesn’t There over came funding then built answers. slowed and it in then you which it’s if in, because and ‘s of needed part, the yes, – we in any And targeted November/December is Comstock, but And winter as part missed March. sense.

powder shutdown. powder we the when COVID coated, it thing painted be reassembled. to was All the company hit, And needed coating use and that

all So very be it the good expect a of and news been about we’re a is, for weeks. will about. And couple here, few we excited within weeks, they’ve now up

that’s what there. So happened

Unidentified Analyst

Okay

Corrado De Gasperis

is the we really of see the to to we and one that In demanding thinking the But were the Philippines, not tail coming we that Comstock a got project sort second on end of work. manage about get systems go little market until because but it’s got forward. capital got has to us, – well. stressful manage it’s we’ve to going and faster, to liquidity, been which build trying And, again, two we’re all a for we’ve very moving and us

Unidentified Analyst

from some been it, understand Okay, I because – I be I trying the testing… of that in Oro has to Philippines, – what done thought one already the scalability done guess, I’m how understood – I and with that’s fantastic. exactly would the thing, scalability guess,

Corrado De Gasperis

Yes.

Unidentified Analyst

project, process? so… it’s on as proven, Because a if far to the not Philippines …as take

Corrado De Gasperis

Yes.

me answer question. Yes. question. that that’s good let a So No,

up design, want intention of hour, be we’re a going XX-ton So in X tons That on substance, is things, okay? scheme But and at rate the is per trial by that per capacity, the to we an it per It’s in landing to Comstock tons X system. of impressive. the to smaller hour because grand It’s total formidable. it’s system hour.

perfect means, We have to We you’re involvement heavy to that involvement can sure want the perfect scale-ups. of we of heavy We regulators. engineering. in the have to to want efficiency. make us And high-XXs want of

be that with to you our these can how going of is proof-of-concept, to high system that go so if that confuse efficient. are will, don’t last fact want to sort And already that okay? the percentage very systems I

Unidentified Analyst

Right.

Corrado De Gasperis

We get XX%, don’t they’re work. XX%, already XX%, efficient. I They know,

So depending deploy can we needs, the and depending on project the on now.

So…

Unidentified Analyst

Gotha.

Corrado De Gasperis

we… So

Unidentified Analyst

size to sending and Philippines? you start? Is that how many What [indiscernible] on are planning in the all there

Corrado De Gasperis

Yes.

So let to question. say things exact two me other that

being not, or is, believe they’re despite it all, it and as the mobile, okay? as first of So impressive big as as system it is all

Unidentified Analyst

Okay.

Corrado De Gasperis

you right? material levels basis. way, test and up trials. be system, – it processing It campaigns, it on We’ll if getting for think to Comstock, the will at and running XX-ton a intents We’ll be right? test hour be be the purposes, bringing running want So won’t continuous, to on there basis, and that it of be those it going on per we’re all a

We site. next site. there to that used equipment We take wasn’t be that say, enough the and we We’ve it will it use anywhere material. at got could the site. of let’s But want. again permit next the can We the can take But to again. take

What’s one think, – going though, then per don’t to feel about I per out we’ve be XXX-ton is head, is – to the the is maybe a largest to XX about? a hour I scale one heard The a to Philippine to idea, the him but objective going to we’re system, Paul I of But per first think in if to hour. we hour, Now system. notion these talk is his idea scale sending, know is XXX, the that that optimal. has XX-ton be good optimal what of to XXX the XXX-ton XXX figure like okay?

Unidentified Analyst

Wow, okay.

Corrado De Gasperis

that So the that’s the part it’s for the the top environment rugged be in. of and of river to sized going nature

the fish system bigger you sand put in. Now part, at gravel. and there’s gravel bigger too, bigger, and and contamination bottom much The for and might but sand there assuming mercury system a is it’s

So…

Unidentified Analyst

Gotcha.

Corrado De Gasperis

Yes.

thinking about. think, the that it’s So that’s range, we’re – I

Unidentified Analyst

or…? built, that currently being Okay. system Is

Corrado De Gasperis

being recap, It’s Comstock just is and painted the So to powder built. coated. system

Unidentified Analyst

Right.

Corrado De Gasperis

gravel and sand it. system I mercury The except all built. system, is – seen additions, think, of the for I’ve pictures the is

Unidentified Analyst

Okay.

Corrado De Gasperis

still and centrifuge there’s the work kind the those do But of and to things. with spirals

it’s third been and And And gravel equipped So that’s sand progress. one started not the has in the yet. unit. then

Unidentified Analyst

Okay. And pushing. call. last started the last question, I not on

Corrado De Gasperis

No problem.

Unidentified Analyst

I the with the the pad with new clean that? tech? It’s Itronics, evaluation. saw referenced… of leach plan What is that The Is part

Corrado De Gasperis

Yes.

Unidentified Analyst

that? So what is the timeframe of

Corrado De Gasperis

So – thank you yes, for that.

really great – get So last that that’s didn’t addressed the yet. great that’s a question question, because it’s only

even and Itronics we lot. technically that. And at It’s of it So it’s – like something the Dr. really remarkable Whitney evolution more thiosulfate-based we a an solutions. really, like

– want ultimate prioritize and essentially, not the what the – the we’re it’s first an do a to but mercury scale that same that’s for think there we able We doing all. with is concept be usable. to proves hasn’t of final scale, build here, we just have right,, system been design thing once the system not to It economic to is

we’re completely notion it’s a list, the But on reprocessing we of means go the its additional with in it’s and objectives, those remarkable it’s hell-bent the which priority commercializing that, the of Always organic, NDAs – have lowest right? said – through always technology it’s list, some different. we’re Having again. tailings signed some of on and hell-bent materials we’ll that’s zero-waste but priority, the those

Unidentified Analyst

Gotcha.

Corrado De Gasperis

like will news from be on that see that the feasibility. a to there I bit making but to the and a we have so, enough we then with longer-term, coming world, then it think bit little know on there. that mercury And slow, work. And prove we’re doing we’re And little hell-bent just goes to

Unidentified Analyst

Luck. Fantastic. Good

stay You safe. guys

Corrado De Gasperis

lot Eduardo, because call. But Eduardo I’d close, like to know I in Thank this wrap will up don’t we apologize, is people Same. – the just Zach at cause do follow-up it getting as after beginning. a what And, difficulty you. of of know and I with the have and did

I of like extra it allow leave but to few minutes for bigger issue And some a usually, this that, a seems was than that.

follow-up We will sure again. all. directly, apologize and it. please happen for a or step make I Zach it. take we’ll absolutely If with to I reach it doesn’t to anybody you, address wants Thanks. every Thank that either to out call,

Operator

you This now Thank for concludes today’s participation. call. your

disconnect. may You now

Comstock (LODE) 9 May 202020 Q1 Earnings call transcript