Welcome everybody to Comstock's Third Quarter 2024 Results and Business Update. This is Trevor Brucato with RB Milestone Group, Comstock's US-based investor relations firm. Comstock is listed on the NYSE American under the symbol LODE. And joining us today is Comstock's Executive Chair and CEO, Corrado De Gasperis; and COO, William McCarthy. I'd like to thank the hundreds of investors who registered for today's event. We received your questions during the registration process, but if any new questions surface, please submit them in the Zoom Q&A module and we'll do our best to address them following management's prepared remarks. Please note this presentation is being recorded today, October 22, 2024, and will be made available on the company's website at comstock.inc shortly after today's event. Again, that's comstock.inc. I'd also like to thank those who participated in Comstock's Q3 Stakeholder Perception Analysis Report that was published on October 3rd and portrayed a positive shift in investor sentiment compared to previous quarters.
In the coming days, we'll be opening up the surveying for the fourth quarter. We'll be circulating the link to registrants and subscribers by email, but it will also be available on the company's website at the top of the investors section. As a reminder, the final report includes trends on Comstock's perceived strengths, weaknesses, and milestones and will be published shortly after the end of the quarter. Your participation will be much appreciated as it will continue to help strengthen Comstock's investor communications efforts and guide the focus of our upcoming events. Please note today's presentation may contain forward-looking statements that are subject to risks and uncertainties that may be out of Comstock's control and should not be construed as a recommendation or solicitation to buy or sell any security. For the company's full disclaimer, please visit comstock.inc. Lastly, RB Milestone Group is not a registered investment advisor or broker dealer. For more information on us, please visit rbmilestone.com. And now, it is my pleasure to turn it over to Comstock's Executive Chair and CEO, Corrado De Gasperis. Corrado, this stage is yours.
Thanks, Trevor, and hello everyone, and welcome to our third quarter update. I'm very happy to report that we have positive updates, insights, and outlooks on all three of our businesses and a meaningful number of expanded partnerships that have positioned our system and capacities in a way that has already altered the way the market perceives us and is engaging us. It's truly gratifying to see all of our teams getting this traction across the board. Similar to our last call, we'll take live questions after these prepared remarks. I'll cover corporate first since we have announced some very meaningful transactions ranging from recent partnerships with the Department of Energy and the National Renewable Energy Lab to our previous announcements regarding capital with SBC. Then Billy will update you on metals and mining, and I'll wrap us up with Comstock Fuels before turning to questions. Okay, so from a corporate perspective, I'm happy to update that I've spent the past two days with SBC and our capital partner, and we are methodically moving forward.
We're genuinely excited about how we have positioned Comstock Fuels, Metals, and Mining, and the opportunities we are now capitalizing on. We are deep in the due diligence structuring process with SBC and believe we have a high-level structure well outlined to facilitate the capital. Some of you have asked about equity versus debt, and we're just trying to optimize the structure for the businesses and our shareholders. These funds are specifically designed to fund each of our businesses with the right amount of the right capital to accelerate their commercialization, capture their markets, and exponentially grow value while taking maximum advantage of our net operating loss carry-forwards and maximizing company-wide value. From the remarkable technological and market advances that both fuels and metals have achieved in just the past three months, plus this recent surge in precious metal prices, people are really starting to appreciate the potential value coming from what we are creating.
There is some complexity here, and everyone needs to be just a little patient as we work through the tranches. They're coming, and we're committed to maximizing the value of the enterprise in the safest and best way. Our liquidity remains stable as we close on some other minor asset sales and the previously announced $1.5 million convertible note while we advance with SBC and frankly some other capital transactions. I stated on the call last time that I expected us to be a bit over 200 million in shares, and we're now at 209 million outstanding. From a corporate transaction perspective, we announced a binding agreement to restructure and own 100% of GenMat’s material science discovery business, including the material science AI technology, the related material science team, and the associated know-how in IP. We're doing it without issuing new shares or cash, but rather assuming the team and the tech into what will become both Comstock's AI engine and its own business.
Conversely, the satellite, the satellite software, and the space-based employees, as well as the small investment in Extropic, will go deep into a new venture that we understand will be called StarVasa. Our focus is, has been, and will remain, material science. We're 100% focused on it, and we could not be happier to have our own team 100% dedicated to material science breakthroughs with dramatically less required spend and dramatically less required capital outlays. We also expect to develop an AI business with external customers while supporting all the advances of Comstock's own breakthrough materials. Speaking of Comstock, we've achieved a tremendous amount in just the past three months. As you've read, Comstock Innovations announced a truly landmark agreement wherein we acquired the exclusive rights for lignocellulosic IP that was developed by the National Renewable Energy Lab and MIT in conjunction with the Department of Energy.
This tech is exclusive to Comstock and includes substantially all of the world's different woody biomasses within those patents. The market is starting to understand that there is really no way to produce even a small fraction of the required renewable fuels, of the required sustainable aviation fuel, without an abundant, extremely low-carbon feedstock. Most people are starting to understand that woody biomass is the only practical answer. We have the technology; NREL has acknowledged this and the leadership of our enabling technology, making our technology platform and frankly our global team second to none. We've consolidated the IP into our platform, and we're jointly developing the next generation of higher yields, lower CI scores, and significantly lower costs. We didn't go to NREL, and NREL didn't come to us just to combine an IP portfolio. They wanted to, and we are very receptive to working with them together on the opportunities that they've identified, the breakthroughs that they've already advanced to get to this significantly lower CI score, significantly lower cost, and next generation of higher yields.
Let me comment on metals and mining. Revenue is ramping up rapidly and the market is expanding for us almost daily. Billy's going to walk you through the update, and then I'll come back around, and I'll wrap it up with the fuels update. Billy, please go ahead.
Thanks, Corrado. So to start, let me refresh everyone on some of our core thinking on the energy transition. I'm going to include both the what and the when. And when I say the what, I mean, what technologies do we think are going to make a real impact? And when I say when, I mean, how these markets are going to evolve over the coming decades. And our core thinking or focus today leads to this core assumption that in the energy transition, where we go from producing the majority of our energy from fossil carbon to producing the majority from biogenic carbon and other renewable sources, there's no question that we definitely need more metals. We need them for all stages of energy production, transmission, and storage. So simply put, the energy transition needs metals. And I don't just mean exotic and rare metals. Precious metals are a big part of this story too. Silver has already emerged as a crucial resource necessary for the energy transition.
Demand for silver by solar panel producers has nearly tripled since 2021. You may have seen the recent news from Samsung about a solid state silver battery. We think this is an exciting early development, but in our opinion, it's only just the beginning of a new energy storage industry generating substantial demand for silver and other metals in the coming decades. Both our Comstock Metals and Comstock Mining businesses are positioned to capitalize on this opportunity. We're seeing the price of silver over $34 today, continuing to move towards $35 per ounce. It's been over a decade since we've seen prices like this. Many in the market are looking for a breakout even higher, one that can lead to historical highs. On the gold side, we've seen strength all year, and we think it's here to stay, with gold as a safe haven asset, hedge against policy and inflation effects, and on other asset values.
Geopolitical conditions around the world are unstable on multiple fronts. The global monetary system is pushing boundaries we previously thought were impossible, and new gold discovery continues to lag historical norms. Yes, gold prices are at all-time highs, but we see a long way to run. We agree with the recent call by Bank of America strategist Michael Hartnett that gold is heading well above $3,000. This opportunity is setting up perfectly for us. We have known resources in the most significant mining district in the United States with a mature infrastructure and team on the ground in place. All the necessary pieces are there to move fast. Our team has spent the past year sharpening pencils and laying out the plans for the next steps. Our latest independent technical report on the Dayton Consolidated, published in 2022 by Behre Dolbear, estimated measured and indicated mineral resources containing 293,000 ounces of gold and 2.1 million ounces of silver, plus an inferred mineral resource containing an additional 90,000 ounces of gold and 480,000 ounces of silver.
As we look forward into next year, we're planning to start work on the preliminary economic analysis for the Dayton Consolidated resource, the first step in advancing the project to production, which we intend to do on the shortest possible timeline. Beyond the Dayton, we're working up exploration and development plans for our other mineral targets in the Southern District, south and west of the Dayton, as well as the Lucerne, Woodville, and Succor Valley targets in the Central District. We're planning to put all of these assets to work. And then when we're done mining, we're committed to reclaim, redevelop, and leave the district better than we found it. That's going to be a big plan, and it's going to take years to reach that goal. For the immediate future, we'll focus on developing our targets, getting to production, and realizing the value of these resources in Dayton, Spring Valley, Lucerne, and the satellite claims.
Corrado and I will be at the New Orleans Investment Conference in late November with the team, where we'll be presenting more on our plans for Comstock mining in 2024 and beyond. You can look out for us to release more information on our website ahead of that conference. Now, let's pivot to talk about a different kind of mining, what we're calling urban mining. Comstock Metals is collecting and extracting a non-virgin silver resource. This is the same silver we pull out of the ground on the Comstock. It's just a different source of ore and a different process. Today, nearly 18% of global silver supply comes from recycling, and 19% of that supply goes to solar panel manufacturing. As solar panel production increases, so does demand for silver. As 10 and 20-year-old panels reach end of life, the opportunity to expand recycled supply of silver is more than substantial, and Comstock Metals is on track to become a significant silver producer.
On the operating side, our team found and filled another meaningful gap in the supply chain this quarter. Before the end-of-life solar panels can be recycled by Comstock Metals, they need to be disassembled, removed, and transported to our facility, what's known as decommissioning. After winning our first bids with a full service offering that included decommissioning, our team was able to quickly mobilize our network of contractors to these sites to begin the work of decommissioning panels and transporting them to us within days. This expanded offering added $80,000 to revenue in Q3, but that was from only a few days of operations in late September. We're confident this new capability adds significant strength to our market position versus our competition. Now, strategically, we established this business in the Southwest US, locating first in Nevada because the region has the largest concentration of old solar panels nearing end of life.
But there are aging panels in every state. In recent months, we've seen increased demand from customers outside our region and across the country. These customers are willing to incur the increased freight costs to use our services. We're competing and winning against what are effectively lower-priced alternatives because we're further away. And I think this is a powerful statement to the quality of service and the exceptional value proposition offered by the Comstock Metals team to the market. In the near term, through the end of this year, we're focused on continued development, including state permit submissions for our first industrial scale processing facility in Silver Springs, Nevada, and county permits for additional storage capacity. Looking out to next year, in addition to the Silver Springs expansion, we're planning site selection and permitting kickoff for additional facilities in the Southwest, plus, you're going to continue to hear and see more details on our plans for expansion nationally.
It's happening now. So yeah, I'm very excited for where we are and the pace that we're moving in both metals and mining and look forward to a strong Q4 setting up for a very busy 2025. I'll stop here and turn it back to Corrado.
Thanks, Billy. I may be a little redundant on some of my comments here, even though I knew what you were going to say, but really just to emphasize it. Our metal recycling business is developing much faster, broader, and stronger than we originally anticipated, giving it a tremendous outlook. Both metals and mining are extremely well positioned, and we are in no way letting up. On the contrary, we're moving forward full speed as Billy just outlined. To be sitting with such an unbelievable silver resource from both sources is joyful. Okay, let me wrap up by moving into fuels. As we previously announced, we have now validated, the fuels team has now validated with strategic customers, higher yields of up to 125 gasoline gallon equivalents. We were frequent in saying when we were over 100 that we were nearly double the next technology's performance or yields. We are well over double the next technology's performance and yields with up to 125 gasoline gallon equivalents from just 1 dry ton of wood.
And we're in the final stages of securing a bolt-on gas to liquids technology from one of our long-time industry-leading technology partners out of Tulsa, Oklahoma, Emerging Fuels Technology, whose gas-to-liquid circuit will convert that additional carbon emission into up to 15 to 20 more gallons of sustainable aviation fuel, pushing our yields to over 140 gasoline gallon equivalents per ton of dry wood and at the same time lowering our already extremely low carbon intensity score. In our industry, by the way, the lower the CI score, the higher the revenue. The planned developments with NREL should further enhance these numbers, potentially increasing yield, certainly reducing operating costs and CapEx, and hopefully putting us in striking distance of achieving cost parity with petroleum. This is our obsession. We understand that cost parity with petroleum is a real stretch goal, but the plans to get there are already developed.
The experiments have been designed. They've been started. With whom? An extraordinary list of partners, including NREL. And that, if successful, even better positions us to truly and sustainably decarbonize all of mobility. During the quarter, we announced our first three independent commercial fuel agreements with South Asian Carbon Limited, or as they go by, SACL, for the delivery of three different biofuel production facilities, including one starting at a 250,000 metric ton per year refinery, which will be located in Southeastern Australia, a second 250,000 ton per year refinery in Northwest Australia, and a third 750,000 ton per year refinery located on the East Coast of Northern Australia. Under the agreement with SACL, Comstock Fuels will contribute site-specific technology rights in exchange for a 20% stake in each refinery, plus a royalty fee equal to 6% of each refinery's revenue.
And on top of that, pre-production engineering fees equal to 6% of total capital and construction costs. Some people might say, well, that's a pretty good negotiation. But it really wasn't a hard negotiation. Because typically when you construct a multi-billion dollar or three ultimately multi-billion dollar projects, it's common for the engineering construction and procurement firm to charge about 15% of total capital and construction costs. What we were able to demonstrate to our partners was that we do at least a third of that work for them. We do the preliminary engineering. We can order equipment. We can support the commissioning of these facilities. So we're going to get 6% of what is typically a 15% fee. Those fees alone could approach $150 million in revenue for Comstock Fuels over the next three, four, five years, depending on the pace at which they commercialize their three projects.
Yet, this is just the tip of the iceberg for fuels. We expect another international deal in the near term and multiple commercial agreements in the United States. They'll include off-takes, site selection, first facility, and feedstocks. We finalized our full business and financial plans for fuels. It's been updated now based on 125 gasoline gallon equivalents. And that plan includes building our own profitable commercial scale demonstration facility. Should sound familiar. We're building a demonstration scale facility that will be profitable. It’s sized for 50,000 dry tons of woody biomass per year or higher, that could produce over 6 million gasoline gallon equivalents or higher per year. And once that's up and running, then building three more industrial scale facilities that could utilize potentially up to 1 million dry tons of woody biomass. And that would represent, if we're using the EFT gas to liquid circuit on top, potentially up to 140 million gasoline gallon equivalents of fuel per year per facility.
That's what the $200 million in capital was designed for. It's the exact number that we have slotted into our model, because about $150 million of that is dedicated to the 50,000 ton a year commercial demonstration scale facility. That model, with just the demonstration scale facility and three industrial scale facilities and a few licensees reflects a multibillion dollar valuation based on discounted cash flows. It is robust. That $150 million is dedicated to deploying that demonstration facility, as I just mentioned. It will include the first site selection, the final engineering, the permits, the construction, and operating it. And those are the conversations that we're having. Are we co-locating it with a refinery? Are we co-locating it with a feedstock source? The answer is yes, yes, and yes. We have choices now. Many of our commercialization partners are also negotiating for the right to also invest in Comstock Fuels.
So there's a really strong project and capital pipeline that's developing here. The business is definitely in a new state of reality with our yield profile compelling the market to us as we engage the market. And coincidentally, we'll be engaging most of those strategic partners starting tomorrow at the Advanced Biofuel Leadership Conference based in San Francisco. Our goal is precise as a company. We're accelerating the commercialization of decarbonizing technologies. These are hard, impactful, but practical technologies. We're now doing it across the system, and all of our businesses are getting tremendous traction. Even our mining assets, which Billy referred to, with gold today at nearly $2,750, and as Billy highlighted, we all believe heading much, much higher. Silver well over $34.50 for the first time in over a decade. Remarkably, with just three Nevada-based recycling facilities, urban mining if you will, operating at 100,000 tons per year each, and assuming and estimating the low end of the silver grades that we've experienced so far, non-virgin, we could easily be in the top three silver producers in the state of Nevada, which is saying a lot.
Most of you already know that Nevada is a silver state because of the Comstock load. We couldn't be prouder. And yet, we're just getting started with those three facilities in the Southwest region. To summarize, and before turning to questions, the metals business is at two shifts and preparing to move with training going on right now to a third shift. As Billy mentioned, potentially tripling combined revenues again in the fourth quarter versus the third, including those decommissioning services while we prepare to file our remaining state permits for our first 100,000 ton facility right here in Silver Springs in the next few weeks. And then starting to assess the next few Nevada sites as the business starts taking a national versus regional ramp up beyond that. Mining with the higher gold and silver prices continues to inherently accrue value. These are our assets, just based on the known gold and silver resources that we have here in the ground that Billy referred to.
The capital that's coming in for that will allow us to expand the resources, expand the mine plan. But even without expanding the Dayton Mine plan, we're pushing nearly $400 million in free cash flows when we start considering these higher-priced resources at the higher grade cutoffs. It's a staggering amount of money, maybe not at all reflected in our market cap. Fuels, we're going to announce two to three transactions, as I mentioned, domestically for sure and possibly internationally during this fourth quarter. But we'll have multiple transactions announced, further validating and expanding our growth. We'll start bringing strategic capital, which will result in a quickening of all of these activities. But rest assured, we haven't slowed our efforts despite lean resources. So, with that summary, Trevor, I'm keen to turn to questions, please.
Thank you, Corrado. Thank you, Billy. And congrats to you guys and the teams across the Comstock platform for a successful quarter. For everybody that is interested in asking a question, you can submit those in the Q&A module. And I'll try to keep this by topic here across the metals, fuels, mining, GenMat, and SBC/corporate type of topics here. So on the metal side, let's kick off with that. How many tons of end-of-life panels are presently stored at Comstock's warehouse and any color on storage capacity?
Sure, Trevor. We have a lot of capacity. We currently have over 300 tons in storage, and as you may recall, we process about 2 tons per shift in the existing facility. That said, we received permits earlier this year for significantly expanded storage, sufficient for the first industry-scale facility, a 100,000-ton facility in Silver Springs. We are actively developing the market, which is a significant advantage for us. It allows us to build our sales pipeline and operate before the facility is up and running, enabling us to hit the ground running once we are operational.
Thank you, Billy. It's intriguing to consider the urban mining operation given the current silver prices and the potential for you to become a larger scale silver producer. It raises questions about what materials are actually being extracted from these panels. You have successfully sold aluminum from recycling end-of-life solar panels, but what about the other valuable materials in the panels? Are you currently stockpiling those materials on site?
Yeah, it's a good question. So there's three streams really that we look at coming out. One is the aluminum, which we're currently selling. Two is the glass. We're having a lot of conversations with different users of that glass and really trying to find the right home for it. It's really not a question of if, but it's just a question of who and when we put that in place for the long term. The third stream is the ore, the solar panel ore, or regulators are calling it tailings. But this is the material that has metal content, has silver in it, has other critical metals, other recoverable metals. And this stream, there's two things going on today. On one side, the metals team has people beating down the door looking to talk to us about this material. And we're going to be making some announcements soon for some initial agreements and some initial sales in the next few months. And the prices we're seeing that people are willing to pay for this are really substantial as well.
It really shows this shortage in the silver market and what it's going to come. We're seeing it on the ground floor in the market for this material. Now, at the same time, we know a couple of things about extracting silver from ore. Our mining team has been working with our processing consultants as well as our internal team, not to ask, can we extract it, but really to look at, can we do it in a way that's more efficient and more profitable than selling it to a third party? And I'd say as it is right now, the answer is maybe. And we'll probably have another six months or a year to really get to the point where we know for sure. But in the meantime, the markets are very robust and there's a lot of demand for that material.
Thanks, Billy. And some of you have probably heard me say, I mean, this urban mining operation is essentially avoiding the exploration risk. You're identifying the feedstock, the end-of-life feedstock solar panels, and processing those and essentially becoming a producer of these commodities. So it is a quite innovative type of business here that Comstock Metals is embarking on. So kudos to you and the team. So additional questions here have come through, but let's shift a little bit more towards mining. So, going from urban mining to, say, traditional mining. It is exciting to hear that Comstock is reactivating, if you will, its historic gold and silver mining assets in Nevada. Billy, I know that there's going to be more news coming out here around the New Orleans Conference, but any clarity leading up to the PEA in the new year related to Dayton and any of the other assets?
Yeah. Well, look, let me say a couple of things, and Corrado, I'm sure Corrado has a lot he wants to say about mining too. I know he's just as excited as I am. The Dayton is the number one priority. It's where we have the most work, the most current work, and we've got a fairly well-defined plan that our team has been working on, again, over the past year, which is really about getting a fast track towards production. Again, what you're going to see next year is that we're going to be doing this preliminary economic analysis. This is really formalizing this plan with the independent consultants, getting everything aligned out so we can move down the line, ultimately to permitting and then to production. So, Dayton is at the top of our list, but I just, worth noting that the whole district is still there and there's a lot of value in it. So we're looking at this as a staged plan, starting with the Dayton and not really stopping until we've seen the full realization.
Yeah, I mean, I would only add that when you're talking about exploration and development, you always have this risk hurdle, right, of achieving economic feasibility. The fact that we have an economic mine, we're majorly de-risked. So we can start stepping out and growing those resources without a fatal fail. We know once we define the resource, once we stop defining the resource, we can start mining frankly at our leisure, at our decision point. So because we've got infrastructure, because we've got legacy permits, because we are intimate with the permitting regime, because we have such a great amount of known geology, it's relatively low risk adventure with the metal prices continuing to move up, it makes it exciting.
Yeah, it's worthwhile mentioning that this is not a grassroots type of operation. This has been around and you guys have advanced it. So I'm sure stakeholders are looking forward to what's to come here on those mining assets. Let's shift our focus a little bit more towards the GenMat deal. How should investors be looking at Comstock's GenMat AI business for material science going forward? And is GenMat Satellite still planning on analyzing Comstock's mining assets?
Yeah, good question. So I mentioned in my prepared remarks that we're all about the material science development. This is foundationally strategic to us. The reason we invested in GenMat in the first place was because we believe if you're in the business of developing materials through technology and you're not using these type of simulation, these type of artificial intelligence compute power, you're going to be a dinosaur. So we don't have any interest in being a dinosaur. We've learned a tremendous amount over the last four years. We've developed a tremendous capability over the last four years. And then that ability expanded, right? It expanded. Deep has a strong vision. He sees forward. His desire to put the satellite into orbit was tied towards developing more artificial intelligence, geospatial, geophysical. And ultimately, we rationalized that it made sense for us to support that because it could benefit Comstock.
So part of our agreement remains that any information, any geophysical modeling, any geophysical planning that we've been doing in connection with that GenMat team, we get the benefit of. Secondly, when they're ready, willing, and able to scan the Comstock district at no additional charge, they will do those physical scans, those hyperspectral scans and provide us that data. We always viewed that additional data, that additional capability as a bonus for us because we have a tremendous amount of geological knowledge, structural, metallurgical, geochemical, we already have it. We have a tremendous amount. That's what made the Comstock an ideal training ground for the AI. So we'll get that data. We'll continue to expand the district the way that Billy described it intelligently with that information. But really that foray into space with that satellite created additional opportunities. And so there's a huge opportunity for spacefaring.
I think Deep’s going into it with a passion and a knowledge that we support, but it's not directly consistent with our material science development thesis, which created the opportunity. Now, that business, he would need to speak to, obviously it's developing, it's nascent, it's exploding, all of the above. The material science discovery business is a little bit more advanced, still requires development and still requires competency. So we're thrilled to add to our innovation capacity those resources. But as I said, if we develop what we need to develop, and it will be in a more Comstock focused solution way, there's no reason we wouldn't be selling that services to others. There's no reason that that line of business couldn't have its own tremendous value. But we want it to benefit Comstock directly first, same idea, use our material developments, our material advancements, as the training ground to develop technologies and tools that we can use and hopefully sell and have others use.
Thanks, Corrado. There's also worthwhile mentioning, a slew of data, historical data, on the mining asset to begin with. So that probably has your hands full already. Another question here on GenMat. So Comstock’s, you guys mentioned that there is no new issue of cash or shares related to this GenMat deal. Can you explain how the $1 million payout will be funded?
We previously funded GenMat, and by relinquishing the assets, we can cover that million dollars without any additional payments from our treasury.
Sounds good, okay. All right, let's shift over to fuels. As part of the SBC deal, $200 million is earmarked for your fuels subsidiary business. You touched on this earlier, Corrado, but can you comment on how a debt-equity structure versus just equity would change SBC's originally proposed ownership of 40% in the subsidiary?
It's a relatively straightforward answer. If you're using some debt in your capital structure, you don't get ownership for debt. We're trying to optimize the capital stack while positioning the company for maximum value creation in a practical and safe manner. We're being very thoughtful about these elements.
Thanks, Corrado. It was mentioned that the binding contract Comstock Fuels landed with SACL is anticipated to bring in around $150 million in revenue from the engineering fees alone over the next three to five years. Can you talk about SACL's upfront payment obligations?
The project's structure requires us to first establish a facility capable of producing 50,000 tons, which we can then expand to 250,000 tons on the same site and using the same assets. Initially, while we're working on the 50,000-ton facility, there is a 3% fee. Once we scale up to 250,000 tons and beyond, the fee increases to 6%. Upon receiving the site license and setting up the first entity, we will obtain 20% equity as well as an upfront payment of $2.5 million. Following that, we will charge 6% on the capital and construction costs incurred. I don't have specific information on the final project timelines and how they may overlap, but we expect to initiate one project, collect an engineering fee along with the $2.5 million, move on to the next project with the same kind of fee structure, and there will come a point when multiple projects will be underway before tapering off. Ultimately, once the facilities are operational, we anticipate transitioning from engineering fees to revenue royalties.
Congrats on the MIT NREL partnership. Can you emphasize the importance of this partnership? And would you say that this might expedite your process, the team's process in establishing a footprint in the United States?
It seems that the main benefit we've gained so far is credibility. When a leading technology partner in the industry chooses our platform and solution for their investments, it validates our position in the market. We're particularly excited about the breakthroughs they've identified, especially those moving towards TRL 3. We are committed to funding the acceleration of these activities with the aim of reaching TRL 6 and TRL 7. The impressive part is that upon achieving TRL 6, we will focus on upgrading our existing commercial demonstration facility rather than building a new one. Our goal is to enhance the facility, shorten processes, and reduce capital expenditures and operating costs while increasing yield and producing 100% SAF without the need for blending. These developments have already been validated in terms of technology readiness. We aim to advance these projects together, which includes testing specific activities in our Wausau, Wisconsin laboratory and in Colorado.
This collaboration is quite remarkable, and we are thrilled about it. In addition to this partnership, we have other internal development projects that we have disclosed without revealing specific details externally. While we understand that not every initiative will succeed immediately, we believe that our leading platform will continuously improve. We anticipate that any competitors trying to keep up will fall further behind as we move ahead more swiftly in our design and objectives than anyone else is discussing. We don't know of anyone else making such progress. It's truly remarkable.
Seems like they are the perfect personnel to get you guys to cost parity with petroleum. On the capital markets front, capital needs and so on, SBC shifting over there a bit. There seems to still be some confusion on New York Stock Exchange AMEX listing requirements versus NASDAQ. Can you quickly touch on anything related to this, whether it be delisting or reverse stocks, but just to put this one to bed.
Yeah, yeah. People keep asking us if we're below a dollar, are we at risk? And I think, frankly, just simply they're confusing us with the NASDAQ. So, the New York Stock Exchange AMEX listing, the market exchange that we're on, doesn't have that dollar limit. It's a much lower number. We're nowhere near it. And we've been on the New York Stock Exchange for 14 years. So we're very familiar with it. So I think it's just confusion.
Thanks, Corrado. And you mentioned that Comstock's liquidity remains stable as you close on some other minor asset sales and previously announced $1.5 million convertible note to top up on the existing one. If you can provide a little color on this and the capital needs and so on moving forward here.
Yeah, look, we've got that liquidity coming in. We're going to try to get that first $5 million in the door with SBC. We've had a great couple of days. It's coming. So we're happy about that. And then we'll bridge that to the bigger capital funding. And then hopefully we're not having these conversations anymore.
Corrado, we are coming up here on the hour, so I'll put the ball back in your court for any final comments.
Just to summarize, I really want to emphasize that the discussions about professional funding are all tied to a relatively high level of sophistication in our financial models. We have sophisticated models and business plans for fuels. Annoyingly and joyfully, we've been updating it quite a bit over the last three to six months because of enhancements. So that's really, really great. Metals, we've been updating because the average revenue per panel has been above our expectation because the realized revenue from selling renewable clean materials is above expectation because we have decommissioning services. And then with our mining assets, the precious metal prices keep going up. And you can change the price in the model; that's simple. But I think most people appreciate that when the gold price goes up, the cutoff goes down, which means you have to re-engineer the mine, resulting in more tons of ore and less tons of waste.
The strip ratio improves dramatically. And so that's what's happening with the mine plans. But then all that management effort to determine what does it take to build three industrial scale plants for metals? What does it take to build these facilities for fuels? That's a lot of engineering. That's a tremendous amount of engineering. I mean, in fuels, it's exponentially higher amount of engineering than it is in metals, but it's still a lot. And those permits have to be ultimately submitted with those engineering plans. More importantly, we have to have project schedules. More importantly, we need to know what the spending is. So the reason we're successful in attracting specific capital, both from SBC and from our strategic partners, is because they're able to validate those models. And validating those models is not a financial jockey sitting in a cubicle reviewing the Excel spreadsheets.
On the contrary, it's petrochemical engineers visiting Wausau. It's chemists assessing metal recycling. These are all science-based businesses. It's mine engineers and geophysicists assessing our mine plans. So we feel very, very good about the foundation that we've built. It's very substantive. We wish it had happened sooner. You always wish that we had gone faster, but we're not disappointed with the results. We're extremely excited about the results and we look very much forward to what's going to happen over the next six weeks. We look forward to talking to you when it happens, announcing it, and then of course, circling back early in the new year for the annual results.
Thank you, Corrado and Billy, and thanks to everyone for joining today for Comstock's Q3 event. Please keep an eye out for today's recording and Comstock's brief Q4 Investor Survey, which will be circulated by email and posted on the company's website at comstock.inc. If you have any questions, please feel free to email us at ir@comstockinc.com. Again, that's ir@comstockinc.com, so management can review and respond to them accordingly. Thanks again. That concludes today's event. We look forward to keeping you all posted on the progress throughout the rest of 2024. Thanks again.
Thanks, Trev. Outstanding. Thanks, Billy. Have a great day.