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spk01: Good day and thank you for standing by. Welcome to the Aqua Metals Announcement Schedule for Third Quarter Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. If you require any further assistance, please press star 0. I would now like to hand over the conference to your speaker for today, Mr. Glenn Axelrod, please go ahead, sir. Good day and thank you for standing by. Welcome to the Aqua Metals Announcement Schedule for Third Quarter Financial Results Conference Call. At this time, all participants' lines are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. If you require any further assistance, please press star zero. I would now like to hand the conference over to your speaker for today. Mr. Glenn Axelrod, you may begin.
spk02: Thank you, Operator, and welcome everybody to AquaMetals' third quarter 2021 conference call. Earlier today, AquaMetals released financial results for the quarter ended September 30, 2021. This release is available in the investor section of the company's website at www.aquametals.com. Joining us for today's call for management is Steve Cotton, President and CEO, as well as Judd Merrill, the company's Chief Financial Officer. During today's call, management will be making forward-looking statements. Please refer to the company's report on the Form 10-Q filed today, November 4th, for a summary of the forward-looking statements and the risks, uncertainties, and other factors associated that could cause actual results to differ materially from those forward-looking statements. Aqua Metals cautions investors not to place undue reliance on any forward-looking statements. The company does not undertake and specifically disclaims any obligation to update or revise its statements to reflect new circumstances or unanticipated events as they occur, except as required by law. As a reminder, after Steve's and Judd's formal remarks, we will take questions. Questions will be accepted over the telephone from analysts and other investors can submit a question using the online webinar portal provided in today's and last week's press release. We will take as many questions as we can in our available time slot. And with that, I'd like to turn the call over to Steve Cotton, CEO of AquaMetals. Steve, please go ahead.
spk06: Thank you, Glenn, and welcome everybody to today's quarterly call. I'm going to start off with slide number one, which is our title slide, which is that AquaMetals is truly leading a revolution in lead in and lithium battery recycling. And today we're going to be talking about our third quarter results. If you would like a more in-depth view of aqua metals, you can refer to our investor website and play back, register for and play back the presentation that we made last week, which has more in-depth information. Today's call is focused on our quarterly results. Slide number two, you will see the safe harbor that Glenn just read, so I won't reread that to you, and that's there in writing for your reference. Moving on to slide three, our mission. And our mission is to provide sustainable metal recycling for materials that are strategic for energy storage applications, be it lead or lithium. Our proven breakthrough technology, which we'll talk about today, aqua refining, returns raw materials to the manufacturing supply chain in a clean way, in an economical way that will help vastly reduce the reliance on mining to meet the growing demand for both the lead acid and the lithium ion industries. Moving on to slide four, change is really imperative in the way that the industrial processes need to electrify and get away from fossil fuels and become clean processes that support the clean initiatives. As you see in the right, the U.S. Department of Energy themselves have said that the vision is for global production of metals using just air, water, and clean energy as inputs. That's the only way we're going to drive towards net zero emissions, which is quite the topic these days as we talk about global climate change in the recent COP26 meetings. So that change is imperative because today smelting produces around 7% of global greenhouse gas emissions amongst other emissions. This is going to go up significantly if we don't change and if we don't make the way that we recycle and even build batteries powered through electrical processes that are powered from renewable energy. So these recycling technologies need to really be incorporated in order to complete that transition. So it's not just in the transportation sector and the energy storage sector, but in that closed loop of recycling. Moving on to slide number five, let's talk about AquaMetal's milestones. If you look at the left side, you'll see that the company was founded not too terribly long ago in August of 2014. And that's when we made our first prototype of an aqualizer, which is our novel room temperature, water-based, organic, biodegradable methodology with low emissions to recycle lead. In July of 2016, we commenced operations after building about a 135,000-square-foot facility in the Tahoe-Reno Industrial Center. And after turning on that facility, by October of 2018, we became a North American-certified lead supplier in ingot form to one of the largest battery companies in the world. And we produced about 35,000 ingots of aqua-refined lead in 2018 and 2019 worldwide. And during that period of time, we did reach 24 hours a day, seven days a week, commercial proving ground technology de-risking operations with the commercial production of that capability to deliver those 35,000 ingots. By February of 2021, as a part of our transition from a capital heavy proving ground mode to a capital light mode of providing equipment and licensing, which we'll talk about, We made an investment in Linigo, which is a lithium-ion battery recycling company, and we'll talk more about our relationship with Linigo today and our recent press announcement today. But at the time in February of 2021, we made that investment, and we also filed a provisional patent associated with taking the arc refining technologies and applying them towards the goal of recycling lithium-ion batteries. And also Linneco purchased the plant, the aqua refinery, in a lease-to-buy scenario, which we'll talk about an update on that front as that has progressed since then. So in July of 2021, we established our first commercial agreement for aqua refining with Acme Metals in Japan. And that is a big milestone for the company because we are in the process of preparing to ship as a product that is a licensable product to this client and partner to develop aqua refining in the Asia Pacific region. August of 2021, we did complete our third generation aqualizer, which we were able to rapidly iterate, focused on innovation through the past year of 2020, which now triples the throughput over the first generation where we've made those 35,000 ingots up to 1,296 kilograms per day per aqualizer. amongst many other improvements that allow the product to be monitorable with our pure metric software suite, as well as additional electrical efficiencies and capabilities of that equipment. Recently, now on a today and moving forward basis where you see the green arrow, September 21, we completed the lab-scale testing of our initial testing on the lithium ion recycling technology. And by December of this year, we expect that we will be shipping the lead equipment in form of aqualizer and other supporting equipment to our partner in Taiwan. So a very important milestone coming up this quarter as we continue to commercialize the lead recycling aspects while we continue to develop the lithium recycling applications. In August, we expect to do operational testing of our full-size lithium ion aqua refining recycling unit and circuit. And by January of 2023, we have the potential to deploy the first full-scale aqua refining process with lithium batteries. Our ticker on NASDAQ is AQMS. We're headquartered in Tahoe, Reno, Nevada. And again, we were incorporated in 2014. We have about 69.8 million shares outstanding. And our cash in hand, which we just reported, is $11.7 million as of September 30th, and Judd will speak more about our financials, inclusive of the fact that the company is a very strong balance sheet and, importantly, is debt-free. Moving on to slide six, aqua refining is really a de-risked technology at its core because we did produce those 35,000 ingots, and we expect to take the many principles from our aqua refining for lead into the lithium-ion industry. recycling aspects and apply what you see in the right important aspects, which is room temperature, closed loop, recycle the chemical that you're using to do the recycling with a fundamentally non-polluted process, as I was speaking about before, which is critical in order to make this transition to electrification of not only transportation and energy storage, but the industrial processes that support the production and recycling of those materials. We have a very strong patent portfolio, which we'll speak to, and we have commercially de-risked a lot of the aspects of the technology through the process that we've gone through to this date to produce our first product. Our solution is cleaner and more cost-efficient in form of recovery as a recycling process. We also produce a higher quality product, and we'll talk about how that applies to not only the ultra-pure lead that we produce, as you see in the background in this picture, where we make the metal one atom at a time through a continuous process, but also apply that 99 plus percent, in the case of lead, 99.996 plus percent purities to expanding to other metals and plating those metals in the lithium space, such as cobalt, nickel, and manganese, and even other products. Recent highlights from our quarter, which we'll focus on today, is that we did establish our Aqua Metals Innovation Center, recently announced, for the development of our lithium ion battery recycling solution and utilizing that aqua refining technology. That is just less than a mile away from the aqua refinery, which is now the Linico facility that is about to turn up as they migrate into next year, with the lithium ion adaptation of the aqua refining facility that we had just down the street there in Tahoe Reno industrial center. So we're very excited about that innovation center and the capability for us to rapidly innovate as we did with the aqualizer program over the past year for lead and get that lithium program where it needs to be. And we'll talk about how we're going to be doing that with a recent press release that we just issued this morning. Completed the third generation aqualizer, as I mentioned before, and we achieved production at over 300% of the original model. We also finalized in the quarter a definitive agreement to deploy aqua refining technology in Taiwan to Acme Metal, which we'll be shipping, as I mentioned earlier, later this quarter, and partner with them to develop direct-to-oxide process. You can see that in a press release that we also issued about our direct-to-oxide capabilities, where we can take what comes off of our aqua refining machines and bypass the whole ingotization process and take the briquettes that we make that we squish from the materials that come off of the aqualizer and put those directly into the battery manufacturing process. So we're very excited about our partnership with Acme to take that technology and bring that to the largest battery manufacturers in Asia Pacific, whom they already have as clients. We have a signed collaboration agreement we announced today with Lineco for the clean lithium ion battery recycling technologies. We'll speak to that in a future slide, so I will just point that out for now. We also received a $1.25 million payment recently from Lineco as part of the lease to own, and that is a non-refundable deposit for the purchase of the McCarran Nevada facility, and that is the facility that's in Tahoe Renewal Industrial Center. We also received a final insurance payment and settlement of $5.25 million, and we achieved a total of $30.25 million collected, exceeding the guidance that we originally provided on that process. We're glad to have that completed and done and behind us. We also further advanced discussions with potential licensees and are very happy with our sales funnel as we continue to try to add additional aqua refining applications for customers throughout the world. Moving on to more details about the Acme Taiwan Agreement on slide number eight, you'll see that they're our first partner and really located in the largest and fastest-growing global lead market. The market for lead is mature, and it's very large. It's around $65 billion for lead-acid batteries globally, but it's growing fastest in the Asia-Pacific market simply because there's more industrialization, there's more cars getting put on the road, and many of those cars have two batteries that are lead-acid battery in them, inclusive of EVs that also have a lead-acid battery in them, and we're seeing quite a bit of growth in that market. This deployment will showcase our off-refining clean lead recycling in a market where these environmental drivers for not only building new facilities, but retrofitting existing facilities have been moving at a very rapid clip, and we see a very strong bend towards the need to have environmentally clean capabilities fuel this rapid growth in that marketplace and capacitization, etc., This also unlocks an opportunity for future partnerships with these global battery manufacturers that are partners and clients of Acme Metal to develop that direct-to-oxide methodology and really take aqua refining towards a much tighter link between battery recycling and battery manufacturing. So stay tuned for more updates as we continue to make that deployment come alive in the coming months. Moving on to slide nine, we'll talk about the collaboration agreement that we just announced today with Linneco. And phase one and phase two are defined here. Really phase one, the focus is immediately beginning to have Linneco process used lithium ion batteries into what's called black mass and take that black mass into the Aqua Metals Innovation Center and process black mass into those high value metals that I was describing earlier. And we will be doing that in our innovation mode with not large amounts of material, but meaningful enough amounts of material to de-risk, improve the technology, and support phase two, which is the goal for both parties, where Linneco licenses aqua refining equipment and technology. And Linneco has announced that they have a potential to process up to 100,000 metric tons of feedstock annually of lithium ion batteries. So it would be one of the largest, if not the largest, battery recycling facility in the world. And we're very pleased that we've established this collaboration agreement to get the lithium capabilities for aqua refining mature enough to deploy into that phase two, as I mentioned earlier in the timeline in an earlier slide. So moving on to slide 10, in order to support all these activities, we have and continue to prosecute a very robust strategic intellectual property portfolio. And we feel that we are well protected in our equipment supply and global licensing efforts throughout the globe. Where you see blue, you see where we have issued and allowed patents that they're not pending. And you'll see in the light blue and blue that we have additional pending patents. We've now achieved 71 total patents that have been issued and allowed with 44 additional applications that are pending, inclusive of lithium ion adaptation of aqua refining related IP that I mentioned earlier that we filed that key provisional patent for just a couple months ago. So with that, I'm going to turn it over to Judd Merrill, our CFO, to talk through the financial overview. Go ahead, Judd. Thank you, Steve.
spk05: I will share a few comments related to each of our financial statements. First on slide 12 on the balance sheet. As of September 30th, 2021, cash and working capital balances were 11.7 million and 10.3 million respectively. Over the last three quarters, we have consistently maintained cash balances over 10 million. This ability for us to maintain the stable cash balance is partly due to the sell of the building insurance proceeds and our reduced cash spend. We have accounted for certain items, asset items, with a net book value of $3.2 million as assets held for sale. These are non-core assets and are no longer necessary for future operating plans. As mentioned in the prior quarter, we accounted for the lease-to-buy agreement with Linneco as a sales-type lease. As a component of the accounting for this agreement, we recognize the estimated fair value of the land and plant of approximately $17 million as a lease receivable. Subsequent to the quarter end, Linaco made their first required deposit of $1.25 million. The deposit is non-refundable. However, it will be applied to the purchase price of the building at the time the amount is paid in full. Lastly, accrued liabilities. includes approximately $2.3 million in remaining costs to repair the plant from the fire damage. We're getting very close to completing the restoration of the plant from the damage, and it's looking very good, and we're pleased with the progress. Most of the building is ready for LendingCo to start moving equipment in, and we anticipate that by the end of the year, the whole building will be available for their use. Moving on to the next slide, the income statement. Cost and product sales increased approximately 2% and 23% for the three and nine months ended September 30, 2021, respectively, as compared to the three and nine months ended September 30, 2020. The increase in cost of product sales for the nine months was a result of plant cleanup costs in preparation for the lease and the eventual sale of facilities. Research and development costs include expenditures related to the improvement of the aqua refining technology related to our lead recycling process, as well as initial development of our lithium ion battery recycling process, which we are focused on and expect additional spend in the coming months. General and administrative expenses increased approximately 62% and 13% for the three and nine months ended September 30th, 2021, respectively, compared to the three and nine months ended September 30th, 2020. The reason G&A increased in Q3 2021 as compared to Q3 2020 is due to a non-cash stock-based compensation credit that we recorded in Q3 of 2020. Overall, our G&A expense has been fairly consistent over the last two years, averaging approximately 2.3 million per quarter, which this number does include both cash and non-cash items. During the quarter, we recorded other income of insurance proceeds, net of related expenses. This is related to the final insurance payment that we received, the 5.25 million during the third quarter. We also recorded a 1.4 million loss on the disposal of certain fixed assets. And net loss for the quarter was a negative $1.386 million. And the basic and diluted net loss per share was a negative $0.02. My final comments are on the cash flow statement. Net cash used in operating activities for the nine months ended September 30, 2021 was $3.8 million. That is compared to $9 million for the nine months ended September 30, 2020. Cash use and operation was positively impacted by cash inflow from insurance proceeds offset by cash G&A, cash operating expenses, and costs related to cleaning up our plants. However, our base monthly cash needs for basic G&A and basic operating costs continues to be approximately $700,000 per month. We don't see that growing in the near future. Even with adding new hires and strategic consulting, which will add bench strength to our team, we believe that those costs will be partially offset by reduced costs elsewhere, such as reduced costs as we move out of the plant. Net cash used in investing activities for the nine months into September 30, 2021, was $1.5 million. and that consisted mainly of 1.7 million for the purchase of property, plant, and equipment, 0.3 million proceeds from the sales and equipment, and 0.2 million utilized towards the investments in LendingCo earlier this year. Net cash provided by financing activities of 10.4 million for the nine months end of September 30th, 2021 consisted of 9.3 million net proceeds from the sale of off-the-metal shares pursuant to the ATM and 0.7 million of proceeds from stock options exercised. The majority of the ATM proceeds happened in Q1, with a smaller portion of just over 1.5 million collected in Q2. I will report that there was no use of the ATM in Q3, nor subsequent to the end of the quarter to this date. Those are my final comments on the financial statements. I will now turn it over to the moderator to begin our question and answer portion.
spk01: Thank you. At this time, the floor is open for questions. Again, I would like to remind everyone, in order to ask a question, you may press star 1 on your telephone. We'll pause for just a moment to compile the Q&A roster. Your first question comes from the line of Ahmed Dayag from HC Wainwright. Please go ahead.
spk03: Thank you, Graf and everyone. Thank you for taking my questions. So Steve, with respect to your shipments and deployments at Acme, are these guys getting the third generation solution or are they getting a prior version of the Equalizer?
spk06: So Acme and Taiwan will be getting the latest incarnation of the technology, and we'll continue to work with them to even further improve the technology over time.
spk03: Okay. And should we expect AquaMetals to receive something from this shipment or deployment in the fourth quarter of 2021?
spk06: The materials are going to be shipping by the end of the fourth quarter. and need to get across, et cetera, and get there and get installed. We're working towards what I've characterized before as a modest amount of payment, ultimately, for the equipment, as well as we will be, once we get the equipment installed and commissioned, be receiving payments for the material that is produced. But again, to guide on that, it's not going to be a material amount of revenue for the company in the early phase, The key is to get the material coming off of the equipment in the hands of the large battery manufacturers to work on that direct-to-oxide stability.
spk03: And with respect to other potential customers, do you have any updates in terms of any pilots or any other progress you have made in terms of securing new contracts with new customers for this?
spk06: Yeah, so we, as I mentioned on the call, have a good sales funnel, and we are very pleased with the global nature of the sales funnel and are intending to add one to two additional licensees in the coming year. And Aqua Metals is going to be certain that we select a licensee that selects us where it's a good match for both parties. And that is what we're really solving for. as we work through and would ask everybody to stay tuned for updates on that. Okay.
spk03: And with respect to the Lineco partnership, are there any near-term milestones that we should be looking for? And then maybe an adjacent question to that is, what kind of resources do we now have to commit? It looks like it's becoming a more serious effort compared to the announcement earlier in the year Do we need to allocate more resources as this picks up? How should we think about the capex or the investment requirements to bring this to market?
spk06: Yeah, so as Judd mentioned, we're shifting our cost structure from the transition of the aqua refinery to Linneco that's taken over the aqua refinery and applying some of those towards the organization. capability enhancements from what we've already enhanced within the organization from an engineering, science, design, process engineering, et cetera, perspective, as well as even commercial resources and other consultative resources that we're working with to develop the lithium space. But so not as Judd characterized, not really a material amount of uptick in our burn rate to do so because we're transitioning those costs. And you asked also about the milestones to expect in the near term. As we continue to develop our technology now with the sourcing of the black mass material, which is post-broken and separated used lithium ion batteries that become called black mass, which has those high-grade metals in that, we'll be receiving that material soon and we'll be able to process that material through our pilot cells and begin to share with the marketplace in summary what we've been able to create and what kind of purity of what metals we've plated, show that, and obviously get into more detail with Linoco in terms of the specifications and evaluation of those materials that come off of our machines. And that'll happen really if you look at the timeline on our website as we round the bend into the next couple quarters. you'll see more and more evidence of that progress, of that technology. I'd like to remind everybody that nobody's really shown in a hydrometallurgical processing for lithium ion batteries a substantial amount of material to date. And we think that with our partnership with Linoco, together we are going to be ahead of the general curve of the industry because there is a building, there's plants and equipment going in, and we have our innovation center. We can begin moving materials from practically upon commencement of the signing of our agreement. So we're very excited about that. And then as you look at our timeline on the website, you'll see through the process of the year, we'll have further full-size pilot cells running towards the end of the year with the intent to begin deploying them as we round the bend into 2023 for production scale.
spk03: Understood. Yeah, that's all I have. I'll take my other questions off you, and thank you.
spk06: Thank you, Amit.
spk01: Your next question comes from the line of Colin Rush from Oppenheimer. Please go ahead.
spk07: Hey, guys. This is Brandon on for Colin. First one for me. With $11.7 million of cash on hand, can you just walk us through your plans to fund the business for the end of 22?
spk04: Yeah.
spk05: So we did have the $11.7 at the end of the quarter. We did receive another $1.25 from the building sale. There's another deposit of $2 million that's due. next year. So there's some additional funds from the building sale that's coming in. The LendingCo does have the option to pay that off sooner. So there's another 12 plus, you know, 13 million or so that we could receive next year. They do have the option to wait till the first quarter of 2023. So there's some additional funds coming in from that. But with the funds we have on hand and some of the revenue that we expect toward the, you know, later part of next year, um and the current spend rate uh that we're on in terms of our needs for gna and for the operating and rv costs that we have in front of us we feel like we have enough funds um you know to take us through and into um you know 2020 2022. great thanks and then just as a follow-up i know you touched on it a bit a second ago if you could provide just maybe a little bit
spk08: more incremental color on the pace of the lithium recycling process development, and then maybe, you know, kind of a target in terms of what we expect out of a proven commercial process on that front?
spk06: So, yeah, the pace is rapid with the lithium recycling technology. One thing we really learned in 2020 was without the distractions of operating the plant of the full-size aqua refinery to demonstrate in the proving grounds of our technology, We were able to focus practically 100% of our engineering efforts towards innovating and as evidenced by iterating our Aqualyzer product twice for a doubling and tripling of capability, let alone the pure metric software and monitoring and connectivity and automation controls. So we've taken that towards our capital light model of rapidly innovating application of aqua refining technologies towards multi-metal recovery for lithium. And that's why we're doing that in the innovation, which is a relatively much lower capital risk for us to focus on innovation and then work with Lineco and other industry to take our technologies and evaluate the output and the integration with their processes and put them in their more capital-heavy throughput plays of taking a business model of taking in feedstock and producing metals and selling those metals where we monetize really unbound geographically through our equipment supply services and licensing business where we can work with multiple parties. But we're very, very pleased with our evolving partnership with Linux so that we can hit the ground running and really make 2022 a banner year for the progress, not only for aqua metal, but really for lithium ion recycling in general. So that's a real strong innovation opportunity deep focus on that innovation side of the business, which is what our business model is really, our Capital Light model.
spk07: Great. Thanks so much.
spk01: Again, in order to ask a question, you may press star 1 on your telephone. Your next question comes from the line of Sean Severson from Water Tower Research. Please go ahead.
spk04: Hi. Thanks for having me, number one. Steve, I was wondering, are there any real technology hurdles left in the lithium ion recycling using aquified refined technology? I mean, if we're looking at kind of getting from where you are today to really, you know, implementation and commercial scale, what is left to be done from a technology standpoint?
spk06: Yeah, Sean. So really kind of what we've done before with aqua refining for lead and extraction of lead through our aqua refining technologies is You have to de-risk the technology by operating smaller units and then going to a full-size unit and then getting that operating in a full-scale facility. One thing that we learned from our development of aqua metals is we spent $200 million building a full-size plant and getting that scaled and having those distractions. We think that by removing some of that distraction and capital-heavy focus, we can continue to de-risk the technology as we go forward. The process engineering and design is there, and we're very confident in our ability to extract the metals that we've named that we would be extracting. We've done some very significant metal separation and extraction already, and now it's taking that and getting that into these pilot cells and getting those operating, getting everybody comfortable with the process flows, and then going towards the full-size scale. There's still de-risking to do, as the lead technology has been de-risked because we've commercially produced 35,000 ingots. That's further along, and that's really our workhorse in our licensing deployments. But we really do see a rapid path for us to do our encore and do it much more quickly through the things that we've learned in the past.
spk04: Next question, if you can look at your crystal ball maybe a little bit here, and I know it's a tough question, but when you look at the lithium battery industry relative to lead battery industry, look at adoption rates and focus on carbon reduction and things like that, how do you think it will unfold? in lithium ion relative to how it did and is doing, I should say, in the lead side? I mean, does your intuition say it should go much faster, or is it kind of through the same process, or what are your thoughts?
spk06: Yes, it's two very, very different industries, right, John? So one is the existing lead acid industry where we're working with the industry players that are leading in that space to upgrade from a pyrometallurgical fossil fuel-based method recycle to But a mature recycling closed loop, which is a great thing that the industry has accomplished, but really taking that towards an electrified, clean process that protects workers, the environment, creates ultra-pure products. In the lithium space, it's a nascent industry, and it's growing at a very much more quick cumulative annual growth rate. By mid to late decade, it will certainly become a larger industry than the lead recycling industry. But there's a lot of work to be done between now and then, and we're looking forward to working with everybody in the lithium recycling industry to make sure that we build together the best possible solution set because, as I mentioned in our presentation, if we don't get this right as an industry and really as a global effort to electrify our processes throughout the world, we're not going to succeed in addressing global climate change at a fundamental level. That's why... We're doing EVs. That's why we're electrifying industrial processes, which is exactly what we're trying to do with our methodology and techniques. So it's really a difference where you see an industry that is looking at an upgrade in the lead space and an industry that's getting built really from the ground up in the lithium recycling space. Hopefully that answers your question.
spk04: Yes, it does. When you look at these customers in lithium ion space, obviously you're looking at electric vehicles and related products, but if you're looking at the carbon footprint and focus, I would think it would be very high there. My question is, what would somebody do if they didn't adopt this aqua refining technology for this? What else would be other solutions? Is this something where one adopts it, everybody has to adopt it to kind of keep pace with keeping carbon reduction on track?
spk06: Yeah, so in order to reduce carbon output and decarbonize, you can't burn things. And so the smelting methodologies will likely yield to the hydrometallurgical methodologies. There are kind of standard hydro, as we characterize it, that's available for which is precipitation-based, and ours is more about metals plating and recycling the chemical that you use to do the recycling, which also has a decarbonization benefit in and of itself. And so we do see that the less things that we burn that are fossil fuels equals better, and we see that our application of aqua refining in our methodologies of the hydrometallurgical can really be an enabler for everyone that's in the industry, whether you're recycling today through a hydrometallurgical technology that could be complemented through ours or a pyrotechnology or smelting that we could literally attach and bolt on and ultimately replace the smelting capabilities with a much cleaner way of doing this as we go into the future.
spk04: Great, thanks. I'll take the rest of my questions offline.
spk01: There are no further questions over the phone at this time. I would like to turn the call over back to Mr. Glenn Axelrod. Go ahead, sir.
spk02: Thank you, Erica. Steve, we've got some questions that have come in online. So I know a bunch of them have already been addressed during this call, but I'll ask some which you could comment on. Has BASF aided ACWA with other potential global prospects for lead refining?
spk06: Yes, so our work with BASF has, in fact, built up our sales funnel and helped us with engagements. And so we're enjoying working with BASF to continue to promote aqua refining into the lead acid industry. We'll obviously be also working with BASF for the system fill of the key chemical in our aqua refining electrolyte, which is the other aspect of our agreement as we ship and deploy and get the Taiwan operation up and running. So we'll begin to transact with BASF on that front. And then lastly, we're constantly exploring the technological opportunities, which was the third element of our partnership with BASF, not only to improve aqua refining for lead, but even to potentially explore aqua refining applications for other things. And obviously BASF has interest in lithium recycling and so does aqua metals. And therein lies opportunities for the companies to discuss additional possibilities of ways to work together. So all in all, we're very pleased with our relationship thus far with BASF and our partnership with them.
spk02: Super. Thank you. One more question here. How does aqua refining ignore non-targeted metals in the feed?
spk06: So what we do with aqua refining as we go for lead, for example, is that there are some metals that will drop out from that and then end up in the residue a very small amount because lead acid batteries, for example, are very much lead-centric in terms of the mineral that's in those batteries. But there are things like silver and bismuth and a couple of other items that we don't plate. And it's because we don't plate them. And it will apply the same when we look at what we do plate in the lithium multi-metal recovery. We will plate in a pure form the metals that we're going after. And any metals that we're not going after will ultimately end up in a residue. But that'll be a very small percentage when you look at the additive effect of the metals that we are going after.
spk02: Thank you. One more question here. I guess in 2022, when do you first expect to start to receive licensing payments? Is it a quarterly, annual basis?
spk06: So we expect to receive the first running royalties on the Taiwan installation relatively soon after we turn the equipment on. Again, the volumes won't be a large amount, but the binary, did Aquamels collect running royalties or not, answer will be yes, and we'll begin collecting those revenues in that form. So we definitely expect in the first half of 22 certainly we'll be receiving those payments and be able to report that we have received those payments.
spk02: Super. Thank you. I have no further questions in the online queue, Steve, so maybe some closing comments and then we'll end the call.
spk06: Yeah, I appreciate everybody's time here, and I'll reemphasize that the AquaMetal's business model is really to enable all the battery recyclers, whether it's lead or lithium ion battery recyclers, with key and core technologies. And as we demonstrated with our lead efforts thus far to date and our first licensee in Taiwan, That gives us a good opportunity to enhance that further, as we've evidenced today with our relationship with Linoco, which both parties intend to lead towards the licensing and enabler for Linoco to be successful. And we want to be the suppliers of the best in class and best available technologies for all battery recycling. And we feel that we are in a great business model, great cash position, great organizational capability to achieve these goals. and really work with the industry to make the world a better place through the electrification and decarbonization efforts that we're all trying to do here. So I appreciate everybody's time and support and look forward to further updates in the near future.
spk01: This concludes today's conference call. Thank you all for joining. You may now disconnect.
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