Comstock Inc.
Q3 2014 Earnings Call Transcript

Published: 16 Oct 2014

[Operator:]

Good day, ladies and gentlemen. Welcome to the Comstock Mining Third Quarter 2014 Results and Business Update Conference Call. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. (Operator Instructions). As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mr. Corrado De Gasperis. Please go ahead, sir.

[Corrado De Gasperis:]

Thank you, Angel, and good morning everyone. My name is Corrado De Gasperis, President and CEO of Comstock Mining. And welcome to our 2014 third quarter conference call. It’s been a priority for us to improve the timeliness of our results. And last night, we filed our Form 10-Q with a record shortened 15-day reporting cycle. We’re very pleased to do that. And today, I’ll provide a brief summary of the information included in our filing and our press release from this morning. And I’ll probably get a little bit more details as well on our geology. If you don’t have a copy (of today’s release, you will find a copy on our) website www.comstockmining.com under news/press releases. Please also let me remind you that in addition to the outlook, I may make forward-looking statements on this call. Any statement relating to matters that are not historical facts may constitute forward-looking statements. The statements are based on current expectations and are subject to the same risks and uncertainties that could cause actual results to differ potentially and materially. These risks and uncertainties are detailed in the reports filed by the company with the SEC, and in this morning’s release and all forward-looking statements made during this call are subject to those same and other risks that we can identify. So with that let me briefly overview some of the quarter and year-to-date results. Our net Dore pours year-to-date, are up 15% per gold ounces and over 33% per silver ounces. We improved our pours every month during the third quarter leading to our highest pour in gold equivalent terms for a single month in September with 2,423 ounces. That puts us just under 30,000 gold equivalent ounce run rate as we keep marching towards the 40,000-ounce annual rate objective. Mining revenue from the sale of gold in the current quarter was $6.5 million. And cost applicable to mining in the quarter were $4.4 million, that compares to $6.4 million for the same quarter of last year that is, $2 million less of cost in the quarter for the same level of revenue. Gold shipments totaled just under, 5,000 ounces for the quarter and silver shipments were just over 61,000 ounces. That number for silver represents a 26% increase from the just most sequential – prior quarter and our second highest silver quarter pours to date. For the nine months ended 2014, gold revenue was $18.1 million up $1 million from last year despite lower prices. The company realized an average price of $1,257 per ounce of gold (audio gap) per ounce of silver. In addition to that the company realized an additional $18.50 per every ounce of gold shipped this quarter, resulting from gold call premiums received through the same period. In comparison, the commodity market prices in the first nine months averaged $12.88 per ounce of gold and (audio gap) to be right on the market with our total pricing. Graded average gold grade was 0.026 ounces per ton and silver grade was 0.564, which was our highest silver grade on average for the quarter to date. Overall, our cash cost to mining for the quarter came in at $832 within all-in, for the quarter just under $1,300. However, our current most recent cash cost was under $1,200. And when we get to the 40,000 rate we’re looking to get below $1,000. Again, those are cash costs that are all-in. These numbers have continued to improve every quarter really for the last two years. And on a year-to-date basis, the profile was really starting to compare favorably. Having said that, for the nine months ended September 30, cost applicable to mining decreased by almost $4 million or 21% compared to the same period last year, primarily from the (audio gap) contract and maintenance cost as well as this overall inventory cost from the above. $2 million of that $4 million decrease was just realized here in the third quarter reflecting the improvement in our progress. For the nine months ended, September 30, or other operating expenses decreased by $2.8 million or approximately 35% from the prior period driven primarily from lower third party expenses and lower internal compensation expenses. Total cost overall when comparing 2014 to 2013 year-to-date were reduced by $6.9 million on a GAAP basis and $7.5 million on a cash cost basis, which overall puts us ahead of our scheduled $10 million savings for the year. And really most importantly positions us to enter 2015 with a significantly lower operating cost profile. Coming back to the most recent quarter, GAAP net loss was down to just $1 million or $0.02 loss per share as compared to $4.5 million or $0.09 per share in the comparable quarter of last year. Net cash used in operating activities year-to-date was $2.69 million – I’m sorry, $2.6 million versus $11.6 million last year, an improvement of over $9 million that’s about 78% improvement. I think more importantly that use of cash $2.6 million was entirely was working capital as our inventory was higher and our accounts tradable and incurred expenses were much lower through 9/30. We also reduced our debt balance during the quarter by $2.2 million and plan on trading off $5 million revolver on schedule by February of 2015 which is just a few months. This month we actually obtained an agreement from our lender with our revolving facility to extend this facility from that current maturity of this coming February, where we expect to be paid off but adding an additional year to the facility going into February of 2016. From our perspective and I guess from most every perspective, the balance sheet is stronger. We’ve even secured a release of some tax and debt liabilities totaling over $1 million, which just further strengthens our overall balance sheet where we ended September with cash and cash equivalents of $9.3 million. With those financial results, let me step back just for a moment and summarize the company’s overall position. We now have over 8,000 acres of land consolidating by any practical definition, the entire mineralized district. This year alone, we have rezoned all of those mineralized patented mining claims that were not already zoned properties for mining, so that effectively now they are ours. We’re going further by also expanding substantially our existing Storey County Special Use permit to go from essentially about 250 acres permitted with the existing mining operation in existing properties. 100 acres which more meaningfully represents the entirety of the Lucerne resource area in the American Flat processing area being boundary now to mine and process. It really is the most significant and expensive permit in the company’s history and lays a tremendous foundation for us to move forward. To date, we’ve proven our great profile. We’ve increased our performance and expectation with our metallurgical yield profile now at 80% yields for gold. And we’re finally getting our strip ratios under control and reducing such that we’re generating cash and more importantly focused on expanding our mine plan to the East consistent with this new county permit. We’ve also expanded tremendously our geological controls such that the data representing the Western mine plan is now fully integrated with full cross-sectional analysis and full geologically led level plans, and really that’s had a tremendous impact on the variation of our mine plan. It’s extremely low now. Our grades are up, our costs are down. And all of that is coming from the strength of the geological control that we’ve integrated into our mine plan. Over the last six months, our geological engineering teams working together has significantly advanced our understanding of this Lucerne geology, really spending from this work on integrating and improving the mine plan to the west. But a tremendous amount of – let’s call it, free drilling development including further detailed geological cross-sections and level plans expanded onto the eastern side of the Lucerne area are now substantially complete and have resulted in significantly expanded resource targets. Our teams have identified additional mineralized material on and/or near the surface throughout that Lucerne area, throughout certain prior mine working and even going in so far as including (audio gap). The east side of Lucerne encompasses nearly half a mile long segment of what we call the Gold Hill Silver City extension of the Comstock lode strike. The east side has an extensive amount of drilling that’s already been completed by us as most of you know but also by others before us plus, all of this historic production data from prior mining. I wanted to share some of that with you because amazingly, from the years of 1860 to 1940, only about 300,000 gold equivalent ounces were mined from this area. But that came from only about 0.5 tons of material. So, in other words, there is an average gold equivalent grade mined from this area of over 0.5 ounce per ton. Most of this production came from underground working although not very deep underground. So these (audio gap) these mineralized areas really now we represent are most significant and doing development. But it’s now being further enhanced by these geological integrations and specifically by the discovery of underground mineralization that is more expansive, more detailed than we understood before. The shoot zone which everybody is familiar with, really for us represents a secondary deeper mineralized underground target that we in respective would drill holes at about 800 feet below the surface. So, these recently identified structures, expanded structures are creating a significant amount of graded tonnage that we’re trying to really get our arms around it. It really started just this past spring when we dedicated our team to the exercise of pulling together and interpreting all this data really to the end of – coming up with not only expanded surface mine activity, but really potentially expanded reserves for underground mining activity. The work that’s been now done has confirmed that the load and the mineralization area is comprised of a group of mineralized structures rather than a simple single vein system that was confined to a single-vault zone. These structural groups all come together into what could be started as a single 150-foot wide zone in the central part of this east side area where in some cases we’ve completed and fully mapped out to widths of up to 600 feet wide. And so there is this incredible emergence if you will of almost 500 feet of sectional data and mine plans that run almost the entire length of the east side. And so, it’s really allowed us now to start deriving great shells and great models from all of those data. I mean, more simply said, the expansion that we’ve been talking about for quite some time to the east not only has such a meaningful amount of surface activity but now what could very well most likely will include some enhancements for let’s call them reasonably accessible much higher grade underground mining opportunities. All of that work has helped us to finally complete our next phase of exploration drilling. And I’m very proud to say that the drilling program for the Lucerne is finally done. But it’s done in a way that it looks much more efficient and much more effective than before. Specifically the program will include 35 reverse circulation holes totaling about 11,000 feet. We’re going to have about 11 core holes added to that, those are important to confirm the metallurgy as we expand through East but also the structural integrity of how that plan will expand. That initial investment would be about $1 million. And then we have two more phases of that that would – could result in another 30,000 feet of drilling and an additional $1 million. That’s meaningful because our, original plan to drill out the Lucerne area with over $3 million closer to $3.5 million. So there is at least a third reduction of the investment required but with much-much higher probability and much-much higher expectation for what the expanded reserve results will be. So, we’re very excited to get that started. And we have schedules to start that drilling here before the end of this month so we’re right on top of it in a much-much more efficient manner. There still is the 2015 component of the program, once Lucerne is done that will include the Dayton and Spring Valley areas. We have not materially updated those plans yet, as the focus has been on Lucerne. But just as a reminder, we were expecting about 80,000 feet of reverse circulation, 20,000 feet of core drilling and ultimately an investment of about $4.9 million for those components. I suspect as we do the work in the Dayton as we’ve done it for the Lucerne, additional efficiencies will come up in a manner that we’ve seen here. Let me conclude with just some recent developments and the outlook. And then we can go right to Q&A. In October, the company received a renewal of our Water Pollution Control Permit it’s one of our major permits in our portfolio from the State of Nevada, the Division of Environmental Protection. The new permit which is effective on October 22, just last this month, next week I guess, renews our existing permit for five full years. And it actually authorizes an additional cell to be expanded from the existing heap leach, we call it Cell 9. Overall for the rest of 2014, we don’t have any really significant capital plans. The only money is that we’re working this spend would probably be in association with expanding that Cell 9 heap capacity going forward at about less than $1 million. We’ve really differed any other capital spending that we’ve talked about in terms of rerouting the road until we have finalized our eastern mine planning, especially if that planning makes meaningful advancement with some of this underground opportunities that I’ve been discussing, as that would actually allow access to some meaningful amounts of ore without moving the road, at least initially. We also understand that our environmental assessment for our new write-away from the BOM is (audio gap) there has been some dates thrown out, and it looks like early November we’ll kick-off the public comment process, which in the environmental assessment process where write-away is really sort of the beginning of the end of the process. So it’s been a relatively long time coming and we’re very excited that we’re getting to those final stages there. The BOM also has issued us recently a three-year extension on our existing write-away. So, we’re in solid-solid shape of their hall-road overall regardless. Also last week, the company obtained an agreement to expand the $5 million revolving credit facility as I mentioned by one year that, which is the maturity of our revolver from February 2015 to February 2016. And lastly, before I talk about outlook, I’m very happy to say that just yesterday we launched a sale for our Limited Edition medallion that we’re striking from pure Comstock silver. We were able to finally get a refiner to dedicate capacity (audio gap) not only that we poured pure Comstock silver .9999 silver. And as we understand it, it’s for the first time since the U.S. mint in Carson City closed in 1893 that pure Comstock silver has been minted as a medallion representing an incredibly rare opportunity to own a genuine piece of the Comstock lode. And in this case specifically we’re honoring Nevada’s (audio gap) 150th year Birthday of our state. We’ve only been out a day or so but sales have been brisk, I’ve seen people are really appreciating the quality of this commemorate. As and, not to mention that it’s mined in the United States on the Comstock space, we’re responsible. So, I’d encourage anybody interested to please go online and put in your orders. It’s going to be a very limited strike. And we’re very proud to sort of kick-off the production portion of our revenue going forward. Let me wrap up with the outlook. Our current mine plan which absolutely is ramping up and we’re excited about that ramp up. We want to move from September’s result up and get to the 40,000-ounce run rate. That really concludes all of the economic feasibilities that we’ve been trying to nail down. And it’s in our grasp getting to that rate of production, gets us below the $750 of cash cost per ounce for mining. And gets us below $1,000 of cash cost all-in. And from our perspective, our mining and processing cost will be less than $24 million this year and that is more than a $7 million reduction overall year-on-year from the past. And we’re also working on those administrative cost reductions that get us down to a total of $10 million overall. We’re expecting that our cash positive results will not only prove in the fourth quarter but cover our capital expenditures. And really the results of all of this geological work is positioning us for finalizing our mine plans for 2015, and really looking forward all of that for growth next year. I’ll pause there. And Angel, if you don’t mind, we could move on to questions.

[Operator:]

(Operator Instructions). And our first question comes from the line of Lawrence Danny, Private Investor. Please go ahead.

[Lawrence Danny:]

Good morning, Corrado.

[Corrado De Gasperis:]

Good morning.

[Lawrence Danny:]

Congratulations on the results, we like the progress.

[Corrado De Gasperis:]

Thank you, sir.

[Lawrence Danny:]

So, my question is, at one point in one of these conference calls, somebody mentioned 3-working shifts 24/7 as far as production. Is that, how far away do you think that possibly is?

[Corrado De Gasperis:]

It depends. We’re – right now we’re operating essentially one shift, its seven days a week but its one-working shift. And our crushing operation is on even less, crushing has a lot of capacity. Really, the answer to that question I think is tied to finalizing our mine plans. It is quite a bit of an enhancement and a twist quite frankly that we have possibility for some underground access in the near term. And so, we would modify our plans accordingly. But generally speaking, when we look towards expanding to the east and we look towards expanding our hall-road through this new write-away that really opens up the opportunity for higher levels of operation. But honestly we don’t have a day or a target caught for that next step. In fact, we’ve been guiding and are looking very much forward to operating at this higher rate of production, this 40,000-ounce equivalent rate. And we can do that within the existing capacity that we have, that would be sort of the next step beyond that which really has to be dictated by finalizing these mine plans from moving east.

[Lawrence Danny:]

And then, the underground mining is that – that’s going to entail lot of building first, building the underground structure and all that?

[Corrado De Gasperis:]

No. So, what’s happening and it’s very nascent so I caution the conversation. But it’s important to talk about. As we (audio gap) on the existing mine which is on the left side of Lucerne and most people understand that the eastern boundary of the mine is essentially the road. There is a wall that we’re facing to the east that has a lot of ore in it. And as we get into the lower benches, in fact, within about a month or two, we should be actually accessing, seeing, exposing if you will underground working from the shifts under the historic areas including the Woodville Bonanza. So, it gives us an opportunity not only geological – the expansion of the geological modeling to the east based on north that we’ve been doing so far. It will expose former mine shafts, tunnel that if you will that we can access from an exploration perspective and further validate and learn about those vein systems. Sitting in that position, you’re also effectively at the opening of a potential portal to go in the underground. So you’ve effectively by mining the surface on the west created the staging area to go in. But you would have to construct is the new shaft going in but not much more infrastructural around it, so that what you need in terms, is not so unique these days anymore. I think there is, quite a few mines who have surface mines, that start off as open pits and then move underground. We’ve always anticipated that that would be the case here based on all the known geology that we have. But it seems like it’s coming a little quicker. So, we have some trade-offs to consider, in terms of surface versus undergrounds. Ultimately I don’t think in anyway shape or form that they’re mutually exclusive. It could be sort of a hybrid situation. But we have a lot of data. So the conversation really isn’t speculative – we’re working it very fast now to get our arms around the feasibility and cost of that development. So, I would expect in the early in the New Year we would have all that pulled together.

[Lawrence Danny:]

So, those existing tunnels would just have to be inspected and made sure they’re safe?

[Corrado De Gasperis:]

Yes. I think what will happen is, for the purposes of exploration and access to getting samples etcetera that’s something that’s been done before and can be done safely. For the purposes of mining, you wouldn’t be using those areas you would be dropping a modern shaft into the area. It could go through workings for certain but it would for most, all intents and purposes, be a new tunnel.

[Lawrence Danny:]

All right. Thank you.

[Corrado De Gasperis:]

Thank you, sir.

[Operator:]

Your next question comes from the line of Jim Zale (ph), private investor. Please go ahead, sir.

[Unidentified Analyst:]

Hi, Corrado, how you’re doing?

[Corrado De Gasperis:]

Hi Jim, I’m fine. How are you?

[Unidentified Analyst:]

Thanks. Couple of questions, first the staff meeting last month, is there anything attributable to that hole and the fact that those pipes are going down (inaudible)?

[Corrado De Gasperis:]

I think that there was, I think there certainly has been and sort of still remains a negative sentiment – in that negative sentiment on the sector. We haven’t – certainly haven’t been immune to that. I think that last week of September, first week of October, I remember October 3, my daughter’s Birthday. And – the gold price was just plunging. And I think that there is a lot of analysis that’s out there showing that gold equity is in our sector, are undervalued to the tune of – relatively speaking gold equity is being valued more like $800 to $900 gold price. So, with that sort of sense to me is, there is already an embedded I don’t know, fear or negative sentiment that gold could drop to those levels. And I think it was exasperated that last week when gold actually dipped below $1,200 because it creates a fear that, could it happen? Is it happening? So, there was a lot of that, there was a lot of that feeling. I think that I’ve always felt that $1,200 was more than a psychological floor. I think it certainly has been proven to be a very resilient price point for gold, physical demand, picks up notably at these levels even though it’s – I believe its robust overall. It picks up and the support seems to be very strong there. But it is a very, it’s a very real level even from a cash cost perspective. There is no question that there is, multitudes of miners that aren’t economic at those levels or below those levels. I feel like personally that gold keeps working to find a floor. I think that it’s been sort of married to this odd euphoria about the equity markets and the economy. I feel that it’s on the economic recoveries by all real measures, it’s still very fragile. And so, we feel – we feel that valuations are good – the valuations are very, very low at these levels, a good point of entry. And ultimately from my perspective the best hedge and the best insulation of all of this, is just to have a lower operating cost. And so, that’s really been the focus, we’ve had only two real focal points on the company, reducing cost and preparing for efficient expansion. And so, I actually feel good about all the months in terms of geological integration and expansion that we’re just not done yet to the point where it’s delivering final mine plans. But we’re getting very, very close.

[Unidentified Analyst:]

Okay. If I can comment on that a little further, in my experience have been investing lower mines, the last one is as you referred to the United.

[Corrado De Gasperis:]

Yes.

[Unidentified Analyst:]

Well, you’re quite the growth lastly – mine becomes unproductive with many mines in their supplies. And then even when the demand picks up it can’t really supply that way. At this point, how many mines are out of production that the price you get again and then it’s sort of like with a new hide and comes back and so forth as if you’re in that phase right now.

[Corrado De Gasperis:]

It’s more – I would even expand on that. It’s more dramatic because it’s so much, its best right now but it’s more dramatic. I think (audio gap) six to eight new 3 billion plus ounce discoveries per annum in the 90s. And then in the last decade that number has dwindled down to less than 2 billion. And in the last three years, I can only think of 1 billion. So, the pipelines have shrunk dramatically. The rationalizations have taken out even more capacity. And you’re not seeing any grade of new discovery that you can either point to. And maybe most remarkably tied to what we just talked about, only a third of these new discoveries are being shown to have good grade, sufficient for economic extraction. So, you’re an all-in low with new discoveries and only a third of those are even being targeted for production. And we don’t have to talk about the long lead times that the regulators impose to even get into production. So, I think that the scarcity factor is going to be elevated to a significant degree even compared to your experience. So, I guess I’m saying I think what you say and I second it.

[Unidentified Analyst:]

(Inaudible).

[Corrado De Gasperis:]

I’m sorry, say that again.

[Unidentified Analyst:]

On one of the days that were pretty bleak in there, we had more than 3 million shares traded. But one of our institutional investor gave up on us?

[Corrado De Gasperis:]

Yes. No, they didn’t give up on us, I don’t believe, not at all. So, we haven’t lost an investor in the case of an exit. We did have one larger investor. So I mean, for number of shares as you saw that our intelligence of that another large institutional investor came inside. I feel like, we had some stock moved from some pretty good hands to pretty good hands. So I think the share base and certainly the top 10 is very stable. And we worked hard on that. And now, we only just started in September after we got the Storey County permit which was so meaningful to the sustainability of the company. We’ve started to get out and communicate more broadly to the markets about our progress. We feel like it’s now – not only important to do it but there is much more substance coming out of that communication both in terms of the expanded permits and the expanded geology. We just have a lot more specific things to talk about which is always good. We’d love to see the market turn but it seemed like it already is now. I mean, from what we just said, the last two weeks has shown a shift in sentiment which is positive to us.

[Unidentified Analyst:]

Great, thank you. One last question for you, would you talk about all these – in completing the new assessments in Lucerne area and so forth. When do you expect to produce that available gold?

[Corrado De Gasperis:]

Yes. So, I think that I mean, frankly the geological work that we’ve done today with just a fine update in our technical report. You’ll be seeing some press releases over the next three to four weeks without question. On just geology, I sort of, I sort of set the stage in this 10-Q and in this press release sort of over-viewing the work that’s been done. But now we’ll start with context – start to release more data, it will be very exciting I think in terms of people seeing the geology of the Comstock evolve. The drilling that I mentioned that (audio gap) once completed I think will justify an update to technical report. So I think we’d look for mine plans to come together with that. And let’s say early next year is your technical report which would be Lucerne only. Once we get through Lucerne, we would like to get down and get the drilling done, really get the same exercise done with today. And we’ve learned so much with this geological exercise about Lucerne. And it’s created such an, efficiency and a more surgical targeted effectiveness of our drilling program that’s forthcoming now that we’d like to replicate that with Dayton, get the same kind of geological integration, get the same kind of cross-section level plan work completed that should result in a more precise drilling program. And then that would result in the second mine plan and then another technical report following that. That’s more likely made through third quarter of next year. But I think there would be, to being full updates early and mid-next year.

[Unidentified Analyst:]

Okay, good. Thank you for your answers.

[Corrado De Gasperis:]

No problem. Thank you.

[Operator:]

Your next question comes from the line of John Leonard, Singular Research. Please go ahead.

[Corrado De Gasperis:]

Hi John, how are you?

[John Leonard:]

Good, thanks. Congrats on the continued progress. I note that you’ve made a lot of progress in paying down debt this year. And I see that you’ve planned to pay off the revolving credit facility in February of next year.

[Corrado De Gasperis:]

Yes.

[John Leonard:]

My question is going forward do you think you’ll be able to transition to funding operations and CapEx, with improving cash flow and revolver as opposed to maybe another equity issuance?

[Corrado De Gasperis:]

Yes, that’s the plan. I think that we’ll pass the revolver, it’s as scheduled. The maturities, it’s only about half drawn now and it would be un-drawn by February, we just got agreement to extend that maturity for a year. And these mine plans that we’re pulling together obviously are designed to continue and improve what we’re doing. So the answer would be yes.

[John Leonard:]

Okay, great. Thanks. That’s all I had.

[Corrado De Gasperis:]

Thank you, sir.

[Operator:]

(Operator Instructions). And your next question comes from the line of Harvey Moorcroft, private investor. Please go ahead.

[Harvey Moorcroft:]

Hi Corrado.

[Corrado De Gasperis:]

Hi Harvey, how are you?

[Harvey Moorcroft:]

Good. The Limited Edition, how many units are you planning on striking?

[Corrado De Gasperis:]

Right. That’s my top secret. But no, in all seriousness we sent, we sent about 2,000 ounces of Dore bars to our refiner. And we had not only physical controls of metal flow but we had extra personnel on hand to ensure that it was only Comstock gold and silver being segregated. And so, our marketing man has the authority to go up to about that level. And that would be the maximum. I’m certain it would be something meaningfully less. They’re already designing the second and third medallions you’ll notice they’re coming out during the holiday season. And so, I don’t necessarily see it as a volume exercise with this first one, it’s so (audio gap) history and anniversary. But it absolutely will be the platform for the next one to be more and the next one to be more and the next one to be more after that. So, we see there is a sort of a foundational kick.

[Harvey Moorcroft:]

How do you….?

[Corrado De Gasperis:]

It will kill me if I even give you a range, so I have to pass my time.

[Harvey Moorcroft:]

How would you like to sell 85,000 ounces of silver?

[Corrado De Gasperis:]

Would love that, would love that. I know we’re going to do a couple of hundred thousand ounces this year. And personally, in terms of just selling bullion and my mandate is what if the highest percentage of that number that you can sell it as products, rather than as commodity.

[Harvey Moorcroft:]

Well, if we have 85 million shares out there and if you gave an option to everybody that has 1,000 shares, you’d get a commemorative at $25 a share that would bring in over $2 million?

[Corrado De Gasperis:]

I will think deeply about our shareholder buying these coins, I appreciate that idea.

[Harvey Moorcroft:]

It wasn’t so the people say, when is the dividend coming, when are we going to see some cash flow? This certainly would be an opportunity if you go options to shareholders of larger, at least a 1,000 shares to get coins at the cost of the ounce plus the striking cost?

[Corrado De Gasperis:]

Yes, no, it’s a good idea. We can think about that. I should mention that we put aside a little bit of (audio gap) for a very, very small strike. We’re still working out from the logistics on that. But it’s all around strengthening and enhancing the brand, the Comstock and what it means to people. And I have to say with just the press release launch and some web capacity we had very, very brisk response already. So we’re very happy with that. And now we’re gearing up for the real target outreach for the groups of folks, that we really now have an interest in this kind of product. So, it’s going to be good.

[Harvey Moorcroft:]

Okay. It seems that 2,000 ounces at $100, that’s only $200,000?

[Corrado De Gasperis:]

Yes, it’s – even in concept the $850 is more of a regional thing. You properly highlight that we have stakeholders that are broader and interested. And we’ll pursue that for sure – that’s in our plans. And how we do it, we’ll think about it a little more. But it’s just – there is, aspects of the load that have global draw, be it the mining history, the western history, the Civil War, I mean, it goes on and on and on. And those markets for those kinds of products are much, much bigger. So, we started at a sort of high premium idea with the State’s anniversary. But we’ve got a lot of broad segments to pursue from here. So, it’s pretty exciting. I take your commentary very well.

[Harvey Moorcroft:]

I’d be happy to address further any other time with you.

[Corrado De Gasperis:]

Sure, thank you. I’ll follow up.

[Harvey Moorcroft:]

Great. Thank you.

[Corrado De Gasperis:]

Thank you, sir.

[Operator:]

And there are no further questions at this time. I would like to hand the call back over to Mr. De Gasperis for closing comments.

[Corrado De Gasperis:]

Well, I thank you all for your time. I’m happy that we were able to do (audio gap).