Comstock Inc.
Q1 2020 Earnings Call Transcript

Published: 9 May 2020

[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. Corrado De Gasperis here, the CEO of Comstock Mining, on the line with Zach Spencer, our Director of External Relations and new Treasurer, with us today. We welcome you to Comstock’s first quarter 2020 conference call.I will provide a brief summary of the information that’s included from our press release from this morning, including progress on our strategic initiatives. If you don’t have a copy of today’s release, you will find a copy on our new website at www.comstockmining.com, and please just click on the Press Releases button in the main menu bar. We will have our quarterly report on Form 10-Q filed today, and we’ve also included the basic financial statements with the press release just for your convenience.We actually had one of our fastest, best scheduled and coordinated closings this quarter, despite everyone working remotely, with the full report actually being completed over a week ago. But we’ve been working exceptionally well with our team and the Deloitte team, everyone working collaboratively with a disciplined schedule. And based on everything that we were able to do this cycle, we expect faster reporting going forward regardless of the distancing measures required by COVID-19.Please also let me remind you that we will make forward-looking statements on this call, including an update on our 2020 outlook. But any statements relating to matters that are not historical facts may also constitute and would constitute forward-looking statements. These statements are based on current expectations and are subject to the same risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties are detailed in previous reports filed by the company with the SEC and in this morning’s press release, and all forward-looking statements during this call are subject to those same and other risks that we cannot identify.Okay, let’s move on to the update. We have now really and fully repositioned the company for precious metal-based growth. The activities we’re going to be talking about now have really substantially all shifted to these initiatives, and in 2020, we’re just driving gold and silver developments with an extreme focus towards our goal.Our goal is to grow our intrinsic value to $500 million – $0.5 billion, we want to say that strongly, with $120 million of that targeted and identified in the shorter term, and $500 million, the total, the larger number in the immediate and longer-term by implementing the plans that develop our precious metal resources and commercialize the cash-generating gold and silver processing technologies that we’ve put in place.That means Lucerne, that means Dayton, that means the claims north of Lucerne and south of Dayton, that means the Mercury Clean Up initiative, MCU, and that means completing and monetizing our non-strategic assets to fund that growth.Starting with Lucerne, as you know, we have partnered with Tonogold. They have reworked the Lucerne resource estimate and they are now updating that estimate based on the higher gold prices and it’s compelling. They’re also expanding some of the claim groupings east of Lucerne in the geographically adjacent area that represents essentially the southern extensions of the Occidental Lode.So they’re working Lucerne and they’ve now expanded and better interconnected Lucerne right up north into the Occidental Lode. The Lucerne and those eastern extensions with the Occidental actually combine two surface minable resources, the Lucerne Mine and resource that’s east of the Lucerne Mine. And again, combined, they’re very compelling.Tono’s also planned a well conceived and expansive drill program that includes these eastern extensions and the Occidental Lode and much more. And they’ve already received permits for commencing some of that drilling in Storey County. They’ve lined up the capital and with our full support are finalizing the selection of their drilling partner.We expect that Tono will be commencing drilling this summer, possibly as early as June, on some remarkably high-grade targets. We’ve not only established a new value in our target list for Lucerne at $25 million, but we’re projecting an additional $35 million from the leases, from the reimbursements, from the royalties that would come from the surface mine groupings.As I mentioned, we have royalties. We have a sustained 1.5% NSR royalty on all of the Storey County mineral claims, not just the Lucerne and the Occidental, but all of them, and in some cases higher. So there will be much more that we’ll be discussing here in the near future when it comes to the work and the geology. But the geological research and the drill plannings and the drill programs that we’ve put together are truly impressive.As you know, we own $6.1 million in Tonogold preferred stock, the majority of which, by the way, becomes unrestricted this month, and if converted to common shares, would total well over 33 million Tono common shares. With the current prices, that values our position at closer to $12 million, not $6.1 million.As of March 31, our third-party valuation firm valued it at a little under $9 million. That is the March 31 10-Q reporting date. It’s now fair for us to say that the geological work that we’ve seen and the capital that’s been lined up and the drilling that’s getting ready to commence, that Tono is really starting to exceed expectations, and there’s much more to come here and we’re looking very much forward to it.In terms of Dayton, we are expanding the economic resource. We are nearly finished with our expanded geological interpretations and then working on the engineering of an expanded pit shell. That work is actually coming together very, very nicely. It’s almost done.But if we just reevaluated Dayton’s value right now, just based on the previous economic shells that we had developed, and those economic shells were developed using cutoff grades that are more consistent with an $800 gold price. And if we just take those shells,- in other words, no reengineering, just the [indiscernible] and resources that we put an economic shell around, we now show a low-end value of Dayton at not $40 million, but closer to $75 million or $80 million, and that’s using a $1.600 gold assumption.Now, I’m not saying we’ve reengineered the economic shell with those different cutoffs. We’re just simply saying with the old, smaller design and today’s gold prices, we have something exceptionally valuable. So we’re going to do that work. We’re doing that work towards the standalone 43-101 technical report for Dayton that we will be looking to publish this year. And I just don’t feel that a value range with what we know now that goes between $75 million, and I’d say up to $150 million is anything, but reasonable in the current environment.When we summarize all of our resources, we lower in the low-end for the Dayton and the low-end for Lucerne, we just literally put the investment and asset values of our other investments on the list, and what we see is a number that quickly gets us to $120 million. We’ve blogged on this recently, but we’re going to be talking about it a lot, because our focus is simply going to be on implementing these initiatives, proving out these technical reports and summaries, developing the resources further and realizing that $120 million low-end value in the market. If we get just half of that, we’re well over $2 a share. And if we get all of it, we’re over $4 a share, as we summarized.Let me move on to MCU. As you know, we partnered and launched MCU. This is our clean mercury remediation growth venture, with two projects in the queue. The domestic one on the Comstock is now scheduled for May, and the one internationally in the Philippines for July. In terms of that means landing equipment and processing the materials.This weekend, the Comstock Interim MCU team will be making site preparations for the delivery and assembly of the first system. It was delayed by quite a bit of time because of the COVID-19. Unfortunately, the majority of the system had been completely manufactured and it was just powder coating and painting that was shutdown by the third parties that were not allowed to work and do that. That’s all in progress now. Site preparations are underway. The system is incredibly impressive.I’m really looking forward to this MCU startup in the U.S., collaborating every single step of the way with the Nevada Division of Environmental Protection. We’ve had least two meetings with NDEP just in the last three weeks, and it’s all progressive, it’s all supportive. I think people are genuinely excited about what we’re about to do here. And we certainly will be posting photos of the system as it arrives and gets set up on our new website. But it’s impressive.MCU, I think, as everyone already knows, has also signed a definitive joint venture agreement with Clean Ore Solutions, our partner in the Philippines, and we’ve been working weekly with them, getting things set up, enabled and ready-to-go. Just the logistics of setting up a foreign branch and getting organized and being able to do business, it’s all happening expeditiously.The Philippines also have COVID-19 restrictions, and those restrictions require if you go there prior to May 15, you have to quarantine for two weeks, so we’re not going there until those things start to get lifted. But we’re very excited about this project, because we recently enhanced the scope of the project by combining the Mercury Clean Up intentions and remediations that we’ve already agreed to with the sand and gravel system.This was really done in collaboration with the Philippine environmental regulatory authorities, and it’s kind of a breakthrough for us, because by building a system, which is happening, being built by Oro, as we speak right now and targeted for delivery in July, we’re creating in addition to the mercury remediation system that will be very, very similar to the one that we’re bringing in here onto the Comstock, although bigger.We’re creating a second system, which actually will be the first one that goes, that is really designed for sand and gravel operations, but will be enhanced also with the mercury remediation technologies. What it means is that, we have a definitive revenue stream and a definitive cash flow that comes from the system, just from the sand and gravel operations, which is a certainty. And then any mercury and gold that we know is in the environment really just adds to the profile.So it actually reflects an expanded scope of what we’re going to be doing there, a meaningful derisker of how we’re going to enter into that business, because we have this essentially guaranteed offtake of sand and gravel that allows the system to get up and running and ensures profitability without quantifying the certainty of the amount of mercury and gold that would also come out of that process.Overall, we’ve built these entire systems initially on our model that $1,200 gold. So we just can’t think of a better time to begin processing these contaminated materials and extracting the gold from them now, with gold at a $500 price higher than it had been.Let me talk a bit in wrap up about our financial position and our outlook, and then we’ll turn to questions. As of March 31, we had total assets on our balance sheet of almost $40 million. I think, that’s probably a record.Our Silver Springs assets are part of that. They’re being – excuse me, held for sale and we’re moving forward. We now expect to close this quarter, most likely within the next 30 to 45 days. The markets were roiled, obviously, by the COVID-19 lockdowns and they’re slowly coming back to at least stability, let’s say. So that slowed the opportunity funds capital raising down a bit.But in the meantime, the fund was focused on the assets that had already acquired last year, including the clean processing manufacturing facility, including the Silver Springs airport. And over the last month or six weeks, the fund has been able to lease its first two companies coming into the manufacturing facility and also break ground on the first new tenant, building hangars on the airport.The leases that were signed were remarkable. They were at rates that were well above what we had planned in our models. Frankly, we were thrilled at the validation of this and the thesis that Northern Nevada and Silver Springs is the place that manufacturing, especially these conservation-based companies, the impact recycling-based companies, want to base themselves at.We’re working with a handful of traditional companies, small, midsized and some, frankly, are very large that want explicitly to move into our opportunity zone. So, despite not having raised the second tranche of money because of the COVID slowdown, the company has been rocketing forward.Maybe to put that in a little perspective. When we acquired – when the fund acquired the manufacturing facility, it paid less than $6.5 million. We valued it based on expected lease rates, let’s say, modeled lease rates and an 8% cap rate of about $10 million. So the idea was we’re getting an incredible facility at an exceptional value.But with the current lease rates that we’ve already secured, signed and sealed, if you use that same 8% cap rate, you’re talking about a valuation of over $23 million just for that facility. So that’s a leap forward and it’s going to accelerate now the rest of our capital-raising activities.And as you all know, everyone is anxious about the fund closing on the two Comstock properties for the remaining $9.7 million that will pay off our debt and leave us with at least $4 million of cash in the bank. The fund is acquiring much more properties and making much more investments than just the two Comstock properties. But obviously, our immediate interest is getting those asset sales closed, so we can be funded and move on.I’ve already talked about our Tono stock position earlier in the call. The stock is highly valuable and becoming more monetizable for us, potentially moving into $9 million to $12 million, if you just look at what other people are telling us the value should be. I had mentioned that that stock for us, most of it becomes unrestricted this month. And Tono is really impressing us with their ability to intelligently put together a pretty remarkable drill program.They also reimbursed us about $0.75 million in cash for expenses incurred during the first quarter, so they’re very timely with that. We appreciate that extremely well. They even reimbursed us some additional monies in anticipation of some of the upcoming expenditures, because we’re fully supporting them with our staff, and that includes local permitting, that includes federal permitting, that includes geological support for the exploration plan and the drilling.So we couldn’t be working more closely with them. Well, we certainly haven’t ever been working more closely with them than we have been now. And we also formalized the remaining number that is due to us from Tono regarding Lucerne, which is almost $5.5 million. We did that by formalizing a note receivable. That note receivable has a 12% interest component associated with it.And starting last month, we are now billing and receiving about $55,000 a month just in cash income from that note receivable. That’s allowed us to not continue the stock sale activities of the past. We did have a little bit that was sold at the end of March. Our outstanding shares are 27,875,000. That was the number at March 31. That’s the number today.So let me just conclude and summarize with our – just six bullet points of our outlook. So number one, this quarter, hopefully, in the next 30 to 45 days, close on the Silver Springs assets, get the remaining $9.7 million, extinguish the $5 million of debt, put the cash in the bank. That’s number one.Number two, Tono launches their drill program. It’s very exciting. It’s going to happen next month, we believe. They’ve already planned it. They’ve already permitted a significant portion of it. That’s moving forward.Number three, we’re going to land the MCU system this month. It will start operating this quarter. That’s going to be a big movement forward for us, finally getting that system on the ground and operating.Number four, we’re going to commercialize the second MCU system with a sand and gravel mercury-enhanced unit first in July, and the second unit to follow, hopefully, before the end of the year.We – our – number five, we are really getting closer to the finish line of our planning and expansion of the geology in the 100% owned Dayton resource. So that we can update our resource estimate, we can start putting economic parameters around it and publish an updated standalone Dayton 43-101 resource later this year.And lastly, not as much of a milestone as just a focus, we’re just – we’re undervalued by any measure recognizable and it’s just horrible in that regard. I blogged that. I mentioned it earlier. But our immediate goal is to unlock the value that we see and that we know, driving us to $120 million. I know that’s almost 10x from where we are now.But when you’re doing things that are tangible, that are technical, that are reportable, that support that kind of number, and we’re going to continue to push it in the immediate term and continue to layer in the growth activities of the Dayton, the MCU and then the projects that will grow and follow, be it from the cash that gets generated, be it from the money and monetizations that we effect, but it’s all laid out and clear. So the focus and the value to realize is sharp, it’s clear and it’s happening.So Eduardo, I think, I’m going to stop there and turn to questions and answers, please.

[Operator:]

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

[Unidentified Analyst:]

Good morning, Corrado. How are you doing?

[Corrado De Gasperis:]

Doing good. How are you?

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

No. So we have $6.1 million of preferred, as you said, convertible. And it’s not – we’re not allowed to convert it until May 22. So coming soon to a theater near you.

[Unidentified Analyst:]

No problem. That’s another source of income that will help get you out of debt and all that. Okay, does Tono have access to the Sutro Tunnel as part of their agreement?

[Corrado De Gasperis:]

Good question. I think that – so the Sutro Tunnel, which originates in Dayton now down about 3.5 miles South of Virginia City. The entrance of the tunnel is accessible, but it’s caved in at about 200 feet in the immediate term. So in terms of entering the tunnel and using it in a free-moving play stance would be no. It’s not safe.Having said that, it goes right underneath the Occidental on its way up to Virginia City. And both we and they have identified meaningful historical information from prior reports that show grade, and a meaningful grade, like high-grade for lengths at that depth. That depth is 1,400, 1,500, to 1,600 feet. And the Occidental has never been accessed in any meaningful way beyond maybe, let’s say, 500 feet. You might have a working at 700 feet, but it’s very, very little.So the point is that, we know there’s grade at surface. We know there’s grade intermediately. But we have huge evidence that there’s grade at depth. So…

[Unidentified Analyst:]

Okay.

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

Yes. Let me expand the thought, Jim, just one point. Okay. So there’s meaningful amounts – sorry, go ahead.

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

No.

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

No, no. So it’s a fair question, but no. So they’re – we’re the priority in the queue and they’ve already paid $400,000 in escrow. We have secured agreements and there’s a very logical sequence of the acquisitions, right, that give the strongest footprint. The airport and the manufacturing facility as operating assets, just the pressure and the circumstance, those had to be first. But the Comstock properties are next in line, and it will happen here.So I think a little bit more patience. It’s taken forever, I understand. But a little more patience and it’s going to be a big win-win and I think everyone’s going to be extremely happy. So it’s all happening.

[Unidentified Analyst:]

Okay. Why don’t you tell them that your stockholders are losing patience here? Last thing is it took forever for the whatchamacallit, your conference call folks to dial me in, so I missed the first third of your presentation. Your MCU operation, you’re going to both use a – start a gravel pit with it after you clean it up and sell the cleaned-up gravel? Am I correct?

[Corrado De Gasperis:]

No, it’s – let me explain a little better. Thank you for that question. So basically, the area under permit is about a 27-mile – I’m sorry, 27-kilometer-long expanse, okay? And there is literally – there are – I may misquote this, and so I’ll be conservative and say like 1,200 miles all along the expanse. And so along the soils, along the surface are alluvial mining activities, and all along the river is mercury contamination. It’s horribly polluted.The process that we have and the one that you will see that we’re even landing here in the U.S., is basically taking alluvium from the surface and processing it and cleaning it. And there is a huge amount of alluvium, sand, gravel, both alongside of the riverbed and in the river. I mean, we will literally be in the river, processing material in a wet format.All of that material, the number one objective is to extract out the mercury and clean the river, clean the soils. In the primary system, there is residual material that comes out, but it’s not designed for higher volumes of that, right? It’s more designed to be surgical in terms of getting the contaminated material, separating the mercury, et cetera.So what we’ve done, because it’s such an expanse, 27 kilometers of soils and riverbeds and materials. We’ve created a higher volume soil and gravel purposeful system with the same mercury controls, the same separators, the same spirals, but it’s at a higher volume. So in that machine, in that system, we’re going to be going to areas, where there’s massive amounts of sand and gravel and, let’s say, maybe minimal amounts of mercury and gold. But even minimal amounts are meaningful.So you’re going to have two systems, one with the primary purpose of processing sand and gravel and still capturing mercury and gold. And then the other one with the primary purpose of capturing, it will still put out some clean soils and some clean gravels, but on a much, much lower volume scale.So one of the things, we’re going to be producing a lot of mercury and a little bit of sand and gravel. The other one is going to be producing a lot of sand and gravel and a little bit of mercury and gold.And so – but the coolness of it is that, there’s such a massive amount of construction and there’s such a heavy need for construction-purposed sand and gravel that we – they’re securing all the off-takes and the government’s even committed to taking the material for their highway and road projects, such that it just de-risks the whole damn thing just – because there’s still, despite the sampling that we’ve done and despite the knowledge that we have of the mercury and the metals contained in the mercury, it’s still nascent, right?So to be able to land the sand and gravel primary unit, make money, generate profit, continue sampling, get the second system ready, bring it in with more intelligence, it just makes the whole project – it actually accelerates the project, but it also makes it safer in the way that we deploy the first system and the second system. So I hope that helps explain it a little better.

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

Well, what I was hoping for, dry coming out of it asphalt-ready. Okay, in other words, you can sell it for link-up and build your own asphalt plant and sell that ready-to-go asphalt something you wanted to?

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

And you’re creating value here, okay?

[Corrado De Gasperis:]

Huge.

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

Yes. The market, too, here, is unlimited. I mean, I stopped counting at 1,500 sites in the U.S. alone that have mercury contamination. So – but it’s a global issue and it’s a UN priority. And the UN’s accord that was signed in 2017 targeted 2020 for countries to cease using mercury in industrial mining activities, and so we’re seeing it, right? The Philippines is actually a leader, believe it or not, in the world, telling the miners to stop using mercury and to bring people like us in to clean it up.

[Unidentified Analyst:]

Okay.

[Corrado De Gasperis:]

So this is just the beginning, just the beginning.

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

Thank you, Jim, for that, and I appreciate the question. And I will just – as you’re signing off, I’ll just compliment by saying that, I had the epiphany, sitting there in the Philippines, talking to the provincial heads, and they kept asking us, "Why don’t you switch the order and get going right away with sand and gravel?" And I said, "Look, we’re not – that’s not our core competency." Quite frankly, it is. Oro Industries has a lot of competency in building sand and gravel systems, and Paul might be one of the best alluvial miners and processors I’ve ever met, okayBut then they said, "Well, what if we take the material from you?" And I’m like, "Say that again?" And the rest was history. So we own 100%. We have nine permits now. Our partner has nine permits that all allow for sand and gravel along the entire expanse, so we’re going for it. So that’s the news. That’s the big update is that, we’re expanding the scope and including that material, and I think it just makes everything so much safer. So Eduardo, next question, please?

[Operator:]

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

[Corrado De Gasperis:]

Hi, David.

[David Brigham:]

Can you hear me, okay, gentlemen? Hi.

[Corrado De Gasperis:]

I can. Yes. Thank you.

[David Brigham:]

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

[Corrado De Gasperis:]

Yes.

[David Brigham:]

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

[Corrado De Gasperis:]

Yes. So great question, David. Thank you. So mercury, in most intents and purposes, is in its liquid form. I think it’s the only liquid element. And if you come onto the Comstock and you drill down to some bedrock in some river waves, I mean, you could literally have a little ball of silver liquid in your hand, okay, that’s not uncommon.And so the technologies that we have, it’s a mercury – we call it a mercury reactor. It’s a centrifuge, which very, very effectively, and then we have spirals and separators that very, very effectively, I mean, light-years more effective than any standard in the industry in terms of separating the mercury from the soils. And then we have an organic solution, which is the fourth technology.We have three engineered process technologies, and then we have an organic solution that allows us to – and this is big – not only separate the gold, but we – I think the biggest differentiator of the technology is not just the effectiveness, the high-efficiency effectiveness of separating elemental mercury – liquid mercury, if you will, from the soils. But we also have the ability to convert methylized mercury.So what happens when mercury enters the environment is it pools, like you’d expect. Gravity takes it down to bedrock. And then typically, if it’s in a water wave, it will find itself down the rivers. That’s very common, okay? Carson River mercury is a problem because of the Comstock.So – but if it stays in the environment long enough, it will methylize. It will literally absorb itself into the biology, and that could be soils, it could be plants, it could be fish. And when it methylizes, that’s generally has been thought of as the point of no return; you’re screwed. Well, we can convert methylized mercury back into elemental mercury. That’s the breakthrough in the technology, and we can do it with organic materials.So we’ll be filing for patents, we’ll be protecting the technology and that’s our claim to fame. And that’s how it – without going into the black box, we can’t describe how it actually works, but it works. So…

[David Brigham:]

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

[Corrado De Gasperis:]

No. Okay, yes and no. There are some applications in mercury. But for most intents and purposes, it represents – the disposal and storage of the mercury represents the highest cost in this entire business line and model.In the Philippines, for example, the government has agreed and it was really critical to us that the government agreed to handle the storage, the disposal, the storage of the mercury. We don’t want to see the mercury go back into the mining environment. That would be inconsistent with the UN’s mandate and the Minamata Accord, which is to eliminate it, not reprocess it back in, right? That’s the toxic problem.So we have some ideas about potential future applications of mercury, but they’re just way too early to talk about. And right now, what we’re trying to do is manage the responsibility and the cost of safely disposing of it, not letting it get back into the environment.

[David Brigham:]

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

[Corrado De Gasperis:]

Yes.

[David Brigham:]

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

[Corrado De Gasperis:]

Yes, good question, and it made me think of one other thing I might not have said in the call, in fact. But I think I did say in the press release is that, they’re working very diligently to have fully audited financial statements. They’re on a schedule of completing a full audit with a top public accounting firm, Marcum.They’re planning then to file a 10-K and become a full reporting entity, and they also have upgraded their Board with independent board members. And they’ve already evaluated and filed – and prepared themselves to uplift onto a major exchange, hopefully, New York, but they’ll be on one. And all of that activity was driven by a wave of, I would say, more professional capital coming towards the investment.So they’re attracting very serious funds. They’re attracting very resource-expert funds, and now they’re taking what I would call the logical evolution of steps, right, to prepare themselves for that, number one.Number two, to answer your question, they’ve lined up, I believe, about $5 million of capital commitments for what is really a well-thought-out drill program. Really well thought out and exciting, quite frankly. And so I think that what we will see them do in the next 12 months is spend $3 million, $4 million, $5 million in drilling, that will enable them to publish the technical report that they have.The technical report will have Lucerne as a central aspect to that update, which is great. But it will also expand geologically a lot of what agrees to them and what they’re looking at. And I think that will, in my mind, represent the next valuation or revaluation of the company. And then I think they will be in a much better posture to then think about paths to production and capital for that purpose. Right?So in other words, their first priority, which is different than, let’s say, a year-and-a-half ago, their first priority will be to expand the geological footprint, do a meaningful amount of drilling to prove certain concepts that they’ve laid out. And those concepts are not speculative per se; they’re based on a tremendous amount of historic data.But if they calibrate to prove those concepts out in the drill program, it look out, right? There won’t be a shortage of capital, in my opinion, because what they will define will be much bigger than what anybody’s talking about. Yes, exploration drilling is a riskier proposition than production, and certainly some things that we’re doing we think are safer.But there’s big upside to it and there’s segments of capital that are very excited about it when it comes with data. And so what – I think what they’re doing, what they’ve been doing is becoming extremely data-savvy. And they – it’s a small company, but they have a big some – they have a big network of advisers, like super competent geological engineers that are working with them.So I think there’s going to be some very exciting news coming out of the Comstock here in the next three, six, nine, 12 months. I can’t speak for them, but we’re very close now. We’re working together in a remarkably collaborative way. So it’s come a big circle. It’s not a circle; it’s just evolved tremendously over the last 12 months.

[David Brigham:]

Thank you for that. Thank you.

[Corrado De Gasperis:]

Thank you, David.

[Operator:]

We’ll now take our next…

[Corrado De Gasperis:]

Eduardo?

[Operator:]

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

[Corrado De Gasperis:]

Hi, Harvey, how are you?

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

Yes.

[Unidentified Analyst:]

We’re looking at Dayton at $75 million. Back on January 6, that was valued at $40 million. So it’s gone up to $75 million. The Mercury Clean Up was – you have valued at $2 million and $3 million back in 2006. And January of this year, it was $25 million for each of those categories. So there’s some significant shifts in both of those. Can you address that?

[Corrado De Gasperis:]

Absolutely. Let’s talk about it, because that’s what I want – that all I really want to be talking about is how we evolved that number ultimately, hopefully, on a path to $0.5 billion. But – so with Dayton, let’s just – let me fill it in really quickly. That $40 million was based on an economic shell that one of our prior and really excellent senior engineers had designed. It was based on a very high cutoff and the average grade of the economic shell was over 12.5 ounces per ton, which is outstanding in terms of an average grade.The Lucerne, by comparison, we mined it at about 0.029, so not quite a double, but 75% higher. And the economics showed about a $30 million net cash flow from a relatively short mine life, let’s say, 2.5 years, okay? So the NPV of that number is almost exactly the same as the number; it’s about $40 million.Our Chief Geologist, Larry Martin, has been doing a remarkable amount of work. And that work is based on additional data and additional drilling that we did since what I just discussed with you. So Larry adding geology, adding data, there have been cross-sections building level plans. He has almost done. He has expanded the footprint of what we know.And in my mentations for all that work to get done, because once that’s done, then our Senior Engineer, Mike Norred, will rerun economic pit shells, okay? And he will not only add the geology to the equation and the engineering to the equation, obviously, he’ll change the cutoffs based on what’s optimal with gold prices.So in my mentations, I said, "Let me just use the smaller shell. Let me just use the more conservative functions and slap $1,600 on the numbers that are $1,200." And the number went from $40 million to $75 million. So that’s the simple answer. And I just thought it was prudent. I don’t think it’s prudent to put a $1,900 gold price on it yet or a $2,000, but $1,600, in my opinion, was what I see people now using in the field.

[Unidentified Analyst:]

Okay. Why did mercury go down from $50 million down to $5 million?

[Corrado De Gasperis:]

Yes. So mercury, when I first did that chart, I think, it was at the Annual Meeting, the idea and this is still the case, right? It’s still the case that we’re going to target projects and this will not be difficult, right? We’re going to target projects that have at least $100 million of value. And by the way, I didn’t say it earlier, but use the Philippines as an example.We were talking yesterday about life of the sand and gravel easily 10 years. Easily running for 10 years, okay, easily. But we’re targeting $100 million. And the way we structured our ownership with MCU is that, if we do nothing, if MCU decided to take a project on in an area that maybe we’re not interested in participating, we get 25%. So that’s, to me, every project should accrue value to Comstock of $25 million.And then – but we have the right of first refusal to have a 50% direct ownership in any project, okay? We have the right to first say, "We would actually like to do more and be more involved in this one and have directly 50%." So 50% direct and then technically, you’re getting 25% of the other. 50% through MCU, you get 62.5%. So that’s the $62.5 million. So that was conceptual. So look, we know we’ve got two projects coming. We should be between $25 million and $62.5 million conceptually. And that’s still correct.However, now we have agreements. And in the Philippines, for example, we are going to – I’m going to propose that we do 50% direct, because it’s exciting, it’s economic, it’s looking really good. But ultimately, that’s going to be 62.5% of not $100 million, but 62.5% of $40 million, right?So what I did in the Philippines, I said, "Look, the asset value is – we now have a known project. The asset value is $2 million, or the asset value is $3 million. That’s the minimum. That’s – those asses are, by the way, all these mercury systems are alluvial mining systems that even if we weren’t in a mercury-contaminated area, would magnificently placer mine the surface metals out of that, even if there was no mercury.So the point there is these assets have value, even if we weren’t using them for the specific purpose that we’re using them for. So at the low-end, I’m just putting the asset value. And then at the high-end, I’m putting what I believe our percentage of the project will be, and it’s nil, right?So – but I expect all of those over time to grow to a minimum – as we learn more, as we have more hard financial data grow to $25 million minimum, and $62.5 million is not the maximum. Projects could be hundreds of millions. But – so I’m just being more conservative with more specific data. I hope that in a year or two from now, there’s 12 mercury projects listed on that thing.

[Unidentified Analyst:]

Yes. I just don’t understand why you were at $25 million per and now you’re at $2 million and $3 million.

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

Okay. If we shift over to the assets and liability page, we’re looking at $39 million of assets, and that is up significantly from the $24 million that you showed in January and the obligations you’re showing at $16.8 million.

[Corrado De Gasperis:]

So ironically, the – I changed the profile of those net assets there at the bottom of that chart. Again, I think more conservatively, previously in theory I was shown sort of Comstock land values and that was almost in a liquidation mindset, like what would our land be worth. And I took that number out, quite frankly.So what I did put in there was assets that are now known and monetizable. So we have assets that have nothing to do with our mining platform that we’re selling, as you know. But the investment in Tono is also a monetizable asset and we have a receivable from Tono and they have some debt.So I tried to be more pedantic and not speculate about other values and tried to say, "Look, this is money and this is money that we’re going to get." And I know it’s ridiculous that the net value is higher than our market cap, and actually, I just want to just pound that into the market. And I’ve had at least 10 calls with you types of investors, three yesterday, asking me these questions. And slowly, but surely, they like what they’re hearing as they get their heads around it. So I’m going to pound this into the market.

[Unidentified Analyst:]

I understand the $5.3 million of debt, but I don’t understand the $16.8 million of liabilities. And what happened to the Northern Comstock debt of $7 million?

[Corrado De Gasperis:]

Yes. So the 16 – yes. So okay, the $16 million in liabilities is reasonably simple, okay? So $5.3 million of that is the debt. We have about $6 million of reclamation liabilities, which is the long-term reclamation liability associated with the leach pad, okay? So that’s not – that we don’t view that as any kind of near-term cash obligation.So you have the debt and you have the reclamation liability, so that’s $12 million and $16 million. And the other $4 million is either – $1 million of it is deferred liability, which is just some expenses that we received from Tono in advance of spending them, so it’s not a real liability.And then we have deposits for MCU, which we have to show as a liability until we close on the actual transaction. And then we just have a couple million of payables and accrued expenses. That’s the balance sheet, pretty simple and pretty clean.

[Unidentified Analyst:]

And what happened to the Northern Comstock debt?

[Corrado De Gasperis:]

So, Northern Comstock is a real obligation. It’s about $6.6 million. It’s not on the balance sheet, arguably, because it’s kind of a lease type of an obligation, if you will. And so Tono has guaranteed and is reimbursing us for that 100%. So it should still be on the radar screen, because technically, we’re the obligor. But we’re not paying any of that right now. Once we close on the Tono deal, Harvey, that will legally also be gone. But right now, it’s substantively gone.

[Unidentified Analyst:]

Okay. How about the number of shares outstanding? It appears to have increased by over 600,000 shares.

[Corrado De Gasperis:]

Yes. So we did a small placement at the end of March, because I had a strong sense that the asset sales were going to be delayed by a couple of months, which is what’s happened. And we just had to ensure that we had sufficient liquidity to get to the asset sales. And by my math, I wanted to be conservative and make sure that even if we didn’t close this thing until the end of June or July, we wouldn’t have any issues with that.So they’re relatively smaller in terms of anything we’ve done historically. I don’t see any more of that happening in the near-term at all, but we did have to do some. And I wanted to be out there and transparent. We have 27,350,000 shares at the end of March 31. It’s the same number today, and it’s the same number that we’re projecting.

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

So…

[Unidentified Analyst:]

It’s a 10-capper. The stock is really worth $5.

[Corrado De Gasperis:]

There’s two answers to the question, right? The first one is liquidity, okay? The first one is liquidity and we have to be good fiduciaries. But the second answer, which I think is stronger, is that, look, we’re going to close on these asset sales. We’re going to land the mercury system. We’re going to publish our data. And if we don’t get that value and there is cash in the bank that we have discretion over, then we would. I think we would, I’d have to get board approval. But I think, though that…

[Unidentified Analyst:]

So the Board has not approved that yet.

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

Okay. Nothing happening with the bank?

[Corrado De Gasperis:]

We had a couple of people look at it and we had – and they seemed interested, but we haven’t heard back. And that’s within the last four or five weeks. We also had an inquiry about leasing the whole facility, and so we’re – with the other asset sales coming to the finish line here, if it isn’t going to be sold at its value we think it’s worth, then it could become a nice revenue stream for us. And remember, to everyone, that we have $150 million of net operating loss carry forward. So any revenue that we bring into the system, for almost all intents and purposes for us, is tax-free.

[Unidentified Analyst:]

What did we pay for the Dayton?

[Corrado De Gasperis:]

So the total cost of the entire facility, plus the extra 120 acres, plus about 400 acres of mineral claims that was really the original reason we wanted it, we wanted the mineral claims that were between us and that property and we ended up just buying the whole thing, because it came as a package deal – was about $2.1 million.

[Unidentified Analyst:]

Can you sell it for $2.1 million?

[Corrado De Gasperis:]

Sure. We could sell it for $2.1 million right now.

[Unidentified Analyst:]

And so we had to buy the stock back?

[Corrado De Gasperis:]

So we have it listed in two pieces right now, like the four buildings on 70 acres for $2.6 million and 120 acres of free land for $1.1 million. And any offers that we get, we’ll be talking to the people. So we’ll be engaged.

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

Okay. Thank you, Corrado. I appreciate it.

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

I understand.

[Corrado De Gasperis:]

Yes. So thanks, Harvey. Thank you so much.

[Unidentified Analyst:]

You bet.

[Operator:]

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

[Corrado De Gasperis:]

Hi, Jeremy.

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

Yes. What we’ve been modeling is very, I would say, has been a very conservative range, meaning, we’ve been modeling grades that I would say are 0.5 gram per ton.

[Unidentified Analyst:]

Okay.

[Corrado De Gasperis:]

And we’ve got feasibility in that range, okay? I think that we’re believing and seeing grades of at least 1 gram per ton. And ultimately, in some of these jurisdictions, there’s two, three, five, seven grams per ton. So in the Comstock, we’re sort of pulling for the lower-end of the range, I’d say, gram-ish per ton. But it gets incredibly exciting when the grades start growing, because – and here’s something we didn’t say. I think it’s obvious, but it’s worth saying.If you compare alluvial mining, which it’s kind of like a lost thing. It’s like a lost art, if you will. But if you compare alluvial mining to hard rock mining, there’s two or three things that jump right out at you.One is hard rock mining takes tens, if not hundreds of millions of dollars to define and prove a resource, ultimately, a reserve, and then tens, if not hundreds of millions of dollars to build facilities and process it. And usually the lead times are sadly, eight to 10 years, right, to bring something into production. It’s a tough business, right?Alluvial mining with an MCU system, on average, $3 million. And when I say $3 million, you have the entire system. You have the mercury technologies, you have a metallurgical lab, you have portable retort, you have a water system. And this thing is impressive, okay, $3 million. And could it throw off $1 million a month? Well, at 2 grams, easy, easy, okay?So the speed, the cycle time, the throughput, the low capital, fast return and I don’t know if I’m weird, but like I love it. I’ll take it any day over the hard stuff, right?. And I guess, I don’t want to disparage hard rock mining, be it open pit or underground at all, because we have a love affair with gold and that’s our core competency, right?But if there’s ways to get at it faster, cheaper, there are other risks, obviously. The biggest one is how well can you sample and confirm the amount of material that’s there? And in some cases, the answer is going to be easy. You’ve just got piles of contaminated stuff.In other cases, where you’re in a river, it’s not as easy. And that’s why the sand and gravel component of our next business is really a wonderful evolution, because it gives us conventional cash stability, while allowing for all the upside to come as we get the mercury and gold. So does that answer the question, as best I could, I guess, at this point?

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

No. There ‘s two simple – yes, two simple answers. We, Comstock, slowed down the funding and spread it out over time, in part, because we needed to, but in part because as the winter sort of came in, it’s sort of – if you missed the November/December window, which we kind of slowed down, too, then it doesn’t make any sense. And then we targeted March. And everything is built and ready.All it needed to be was powder coated, painted and reassembled. And when the COVID thing hit, the powder coating company that we use shutdown. So the good news is, they’ve been up now for about a couple of weeks. And we expect within a few weeks, it will all be here, and we’re very excited about. So that’s what happened there.

[Unidentified Analyst:]

Okay

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

Yes.

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

Yes. So let me answer that question. Yes. No, that’s a good question. So in substance, the system that we’re landing on the Comstock is going to be an up to 25-ton per hour system. It’s formidable. It’s impressive. But in the grand scheme of things, it’s a smaller rate of capacity, okay? That is by total intention and design, because we want to trial it at 2 tons per hour, 4 tons per hour.We want to have heavy involvement of engineering. We want to have heavy involvement of regulators. We want to make sure that we can perfect the scale-ups. And perfect to us means, you’re in the high-90s of efficiency. And so that system is going to be our last sort of proof-of-concept, if you will, to how high that percentage can go okay? I don’t want to confuse that with the fact that these systems are already very efficient.

[Unidentified Analyst:]

Right.

[Corrado De Gasperis:]

We get 80%, 90%, 91%, I don’t know, they’re efficient. They already work. So depending on the project and depending on the needs, we can deploy now. So…

[Unidentified Analyst:]

Gotha.

[Corrado De Gasperis:]

So we…

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

Yes. So let me say two other things to that exact question. So first of all, despite the system being as impressive as it is and as big as it is, they’re all mobile, believe it or not, okay?

[Unidentified Analyst:]

Okay.

[Corrado De Gasperis:]

So on the Comstock, the 25-ton per hour system, we’re going to be getting material on a test basis, for all intents and purposes, at those levels and bringing it up and processing it there on a test basis. It will be – it won’t be continuous, right? We’ll be running trials. We’ll be running campaigns, if you want to think of it that way, right?But let’s say, there wasn’t enough material. We can take that anywhere we want. We can take it to the next site. We could take it to the next site. We’ve got the permit of use at that site. But the equipment will be used again and again.Now the idea is – the idea, though, is to then scale to a 100-ton per hour system. I don’t know if Paul has a notion of optimal in his head, but I think we’ve heard him talk about 100 to 200, maybe 100 to 300-ton per hour. But one of these – the objective is to figure out what is optimal. What’s the largest scale that we feel good about? The Philippine system, the first one that we’re going to be sending, I think, is going to be like a 50 to 75-ton per hour, okay?

[Unidentified Analyst:]

Wow, okay.

[Corrado De Gasperis:]

So that’s sized for the top part of the river and the rugged nature of the environment that it’s going to be in. Now at the bottom part, assuming there’s fish and mercury and contamination there too, you might put a much bigger system in. The sand and gravel system is bigger, but it’s bigger for sand and gravel. So…

[Unidentified Analyst:]

Gotcha.

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

Right.

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

Okay.

[Corrado De Gasperis:]

But there’s still work to do with the centrifuge and the spirals and those kind of things. So it’s in progress. And that’s the sand and gravel equipped unit. And then the third one has not been started yet.

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

No problem.

[Unidentified Analyst:]

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

[Corrado De Gasperis:]

Yes.

[Unidentified Analyst:]

So what is the timeframe of that?

[Corrado De Gasperis:]

So – yes, thank you for that. So that’s great – that’s a great last question, because it’s the only question that really didn’t get addressed yet. So we really, really like the thiosulfate-based solutions. And Dr. Whitney at Itronics – it’s an evolution of that. It’s something even technically more remarkable and we like it a lot.We think it’s usable. It hasn’t – we just have not been able to prioritize the final design of – essentially, what we want to do there is the same thing we’re doing with the first mercury system here, right,, is build a system that’s not to be ultimate scale, but to an economic scale that proves the concept once and for all.Having said that, we have signed some additional NDAs with some remarkable technology that’s completely – it’s different. Always organic, always zero-waste in its objectives, and we’re hell-bent – we’re hell-bent on the notion of commercializing the reprocessing of those tailings and we’ll go through those materials again. But it’s the lowest priority of the list, but it’s on the list, which means it’s a priority, right?

[Unidentified Analyst:]

Gotcha.

[Corrado De Gasperis:]

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

[Unidentified Analyst:]

Fantastic. Good Luck. You guys stay safe.

[Corrado De Gasperis:]

Thank you. Same. And, Eduardo, as we wrap up and close, I’d just like to apologize, because I do know – I don’t know what the cause of it is and Zach will follow-up with Eduardo after this call. But a lot of people did have difficulty getting in at the beginning.And usually, I leave a few extra minutes to allow for some of that, but this seems like it was a bigger issue than that. We will absolutely address it. I apologize for it. If anybody wants to follow-up with a call, please reach out to either Zach or I directly, and we’ll take every step to make sure that it doesn’t happen again. Thank you, all. Thanks.

[Operator:]

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