AREC - NASDAQ

Greetings, and welcome to American Resources Corporation Third Quarter 2021 Conference Call. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mark Laverghetta, Vice President, Corporate Finance and Communications. Thank you. You may begin.

Thanks, Doug. Good afternoon or good morning, everyone. On behalf of American Resources Corporation, I'd like to welcome everyone to our third quarter of 2021's conference call and business update. We welcome this opportunity to not only discuss our accomplishments over the past quarter and first 9 months of the year, but also on where we have our site set as we embark on this exciting time. Also on the call today is Mark Jensen, American Resources Chairman and CEO; Kirk Taylor, our Chief Financial Officer; and Tom Sauve, our President. Before we kick it off, though, I'd like to remind everyone that this call is being recorded and of our normal cautionary statements. Certain statements discussed on today's call constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from the results discussed in the forward-looking statements. When considering forward-looking statements, you should keep in mind the risk factors, uncertainties and other cautionary statements, which are laid out in our press releases and SEC filings. We also do not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Lastly, we will be holding a question-and-answer session today following our prepared remarks. For anyone wanting to ask a question, you'll need to dial in by phone to get into the queue. With that said, I'd like to turn it over to Mark Jensen.

Thanks, Mark, and thanks, everyone, for joining. The third quarter of 2021, we continue to show material execution in terms of the long-term positioning of American Resource Corporation as a long-term supplier for the raw materials of the infrastructure and the electrification marketplace. We showcased our ability to innovate in industries and utilize an asset base that is positioned extremely well to supply these high-growth markets, which is fully aligned with the U.S. priorities within the electrification and infrastructure market. Over the first half of 2021, we're able to define our critical and rare element technology chain specifically to capture, process and purify critical and rare developments in the most environmentally safe methods ever developed. More recently, we've been able to showcase our ability to process and purify battery and magnet metals to ultra-high purities and yields to levels that are currently not being done with the United States market today. We remain very motivated to bring these innovative applications to the commercial market while focusing on the circular life cycle of the critical -- critically important materials. We remain highly motivated to bring these innovative applications and solutions to the commercial market at the time when we feel that the stars are aligned in the infrastructure and carbon markets and deliver the best year in our company's history in 2022. Just to give a brief reminder on the business that we've built over the years and how we got there. Since the inception, we've closed on our 8 acquisitions beginning in late 2015, where we acquired an asset base with substantial discounts to replacement value, basically utilizing the team's efforts and the efforts of our partners to restructure this asset base and acquire it at times when the market was suppressed, we're -- and repositioned that asset base for a more forward-thinking business model from a low-cost structure, but also scalable structure to take advantage of market similar to what we're in today. Our goal has always been to leverage the entire asset base to basically streamline the operations and flatten the organization where all of our employees and our shareholders benefit. Since inception of the -- and since we announced our Critical Element division, we've acquired over 16 patents in technology and supplemented those patents and technologies with 3 sponsored research programs with very, very strong university partnerships and a very strong team, where we can refine the technologies that we've acquired to be commercially viable and to showcase that commercial operations in the coming year. I want to dive into the -- our American Carbon business line, which is at a unique moment in time today, and we're in a unique spot as a business. If you open up the any market journal or any news organization, you can see that the carbon market is seeing significant strength. We've seen prices double in our market, and we've seen customers clamoring for supply as the need for steel and the need for infrastructure has grown rapidly. Not only here domestically, but also internationally. Recent publications have announced that the carbon market is sold out for 2022 on a substantial basis, given our industry relationships and industry knowledge, we confirm that, that's effectively true. Shortly thereafter, the United States passed an infrastructure bill. That infrastructure bill is going to set essentially a higher floor for carbon prices for the foreseeable future and at least forecasting over the next 3 years. And puts our restructured mines in a very strong position, given we're going out to market and we're ramping up our production aggressively as we speak. Federally funded projects, you're going to start to see U.S. produce deal. And within an infrastructure bill, there is legislation that says that U.S. that infrastructurally funded bill from federal funds, we'll need to use U.S. steel. And we're going to see additional demand, we believe, coming online during the coming year. I'll dive into a little bit of updates on each one of our complexes. Our Perry County complex, which is the first complex we opened is currently ramping up production. Current section is producing and now finally producing stably. We've been able to secure substantial labor force and a really strong labor force, a dedicated men and women at this operation. We've invested heavily into the infrastructure and the equipment. Just to put it -- to take a step back to walk through this operation, we acquired this out of bankruptcy, and it was in rough shape when we bought it, but the bones were solid. And the quality of this carbon and the capability of this operation was strong, and we saw that. We streamlined this, we invested heavily into the mining equipment and to the infrastructure within the mine, the belts, the continuous miners replacing DBT miners with continuous miners that are much more efficient and much more able to be serviced in terms of getting parts and supplies in. We've invested heavily into the processing plant. Developing just recently the Middle Link circuit where we can recover more of the carbon that was traditionally going to the landfill. And establishing protocols within the labor market, so we can enable our employees to also benefit from the growth of the organization and the profitability of the organization, including this week alone, we're announcing a clean ton bonus for the men as they perform and our shareholders benefit from it, they will also benefit from it. We see our ability to continue to drive growth of the Perry County complex to be substantial. We have new sections coming online. And by the end of the year, we'll have over 3 sections running within this mine to take advantage of the market. 3 sections have not running this mine since 5 years before we bought it. And the ability to add a fourth and fifth section has already been planned on the engineering side of our business. Our McCoy complex, we announced we just commenced operations in early October and recently just announced, we've already begun selling carbon from this complex. This is a high-vol B complex, a very high in demand complex. We have the Carnegie 1 mine that is currently producing. Carnegie 2 is in the final stages of mine development and will be in production most likely by the end of this year. And then, already starting to move on the planning site of Carnegie 3, Carnegie surface mine as well as our mine 17, which is our PCI mine in that area. We're seeing the ability to track labor, given the quality of the equipment that we're putting into these operations and the stability of these operations. And most importantly, we're able to bring these operations online in a very, very strong market, which is enabling us to attract high sales at a price where we see -- when we first started to bring these complex online, we were looking at sub triple-digit sales prices, and we're seeing substantially more than that today as we're ramping up these complexes. So we're able to benefit from these higher-priced margins. The labor and supply chain challenges within our industry are real. And no different than the real across the world in any industry out there. What we've seen is our ability to attract labor is the equality of the equipment and the quality of team we have in place. And we've been able to attract labor, and we're confident we're going to continue to be able to attract labor. We're putting in policies and procedures to be able to react faster and be more nimble. On supply chain, you can see we invested heavily back into our business where we're buying more inventories and more supplies to have them on the shelf. So we're not ordering on a real-time basis as we've historically done. We're establishing those procedures to enable us to hit our growth profile that we're targeting to achieve in the 2022 year. As stated, to discuss the market environment, it is highly public that the industry is sold out, and this is one of the most unique aspects I've ever seen in the coal industry in my entire line. Getting into this industry in 2006, I've never seen a market as strong as this, but more importantly, a market that is undercapitalized and won't be able to grow at the same rate that we're seeing the demand grow at, which enables us to see that forecast that future where we're going to see strong prices for a significant period of time and be able to capitalize on that while also still keeping our cost structure extremely low. The strength of this global market we find ourselves in today is puts us set a unique spot for our asset value. And the ability to provide incremental supply in this very tight market, given our growth platform and given the quality of assets that we've acquired over the last 5 years and the efforts that we put forth to restructure them. Regarding our sales outlook for the next year. On a go-forward basis and until we -- until the world normalizes from the supply chain and labor shortages that we see within these interruptions, we are only going to discuss -- we are only going to focus on our discussions on the mines that are currently in operation and are currently producing carbon for the steel industry. As stated, we have other mines in the development. But given the challenges in the market, we don't want to provide forecast on those future operations, we're only going to discuss the current production we have. Discussing current production from our mines coming online, discussing production from our mines that into production that are coming online, even in the near future, is challenging the time and being off even a month or a quarter has a significant effect on us being able to hit our forecast, and we want to be cognizant of that to our investor days. With that being said, going into the 2022 year, based on first quarter pricing, we have today, we have an order book that would equate to over $110 million in revenue for the 2022 year from our 2 currently producing mines. Regarding our fourth quarter production and 2021 guidance, we previously provided. As of today, we are producing out of both of the 2 mines that we initially guided for. That being said, ramping up the production during the course of the year, as shown through the 3 quarters of production has been slower in getting mine plans approved, labor brought on board, equipment and supplies delivered, et cetera. As such, we will be short of our guided revenue for the year, but we believe we will continue on a path of solid quarter-over-quarter and year-over-year growth. In our industry, given the stair-step growth of revenue from bringing new mines and new sections online, being slower by a month or even a quarter is substantial when you're starting up newly restructured mines. That being said, by the end of the year, we will be on a run rate consistent with next year's monthly order book I just previously discussed. Overall, we had hoped things would have happened a month or 2 quicker, but we are ecstatic about the performance from our team, our current production and the current market environment as we're ramping up our production, which probably would not have existed in the market had been more normalized and would not have been able to take advantage of this current pricing that we're seeing in today's market. Given where we're talking about our current order book, we will provide additional updates over the coming months when additional mines come online, and those additional complexes come online and additional sales commitments are established for this new production, beyond the $110 million of current order books we have for the 2022 year. Now, I'd like to turn it over to Mark Laverghetta, to discuss updates on our Rare Earth and Battery Metals division, American Rare Earth.

Thanks, Mark. I appreciate everybody's time today. As a reminder, I just want to let everybody know. When you look back at what we've accomplished over the past year, we announced our Rare Earth division only just 30 months ago. Over that time, we've defined our innovative approach to the critical and rare earth markets, and it's a really exciting division for us, especially when we're bolting in side-by-side to our American Carbon division that Mark just explained, where we are in great position, the stars are aligned to produce our best results in company history. Our Rare Earth division represents a strategic opportunity to provide that low cost, sustainable part of the domestic supply chain as we bring the most environmentally safe processing and purification technologies to market. We believe that for the U.S. to establish a competitive position in these supply chains, we need to lead the world in innovation. And it's imperative that our domestic supply chain of these critical and rare earth elements be low cost, sustainable and environmentally safe. That's how we believe the U.S. is going to thrive, and we're right at the heart of all these priorities. We vastly believe that the most efficient means to create a meaningful impact in our domestic supply chain is to first focus on the recycling or circular life cycle of battery and magnet metals. And that's what our purification and isolation technology is doing right now. We're highly focused on that. Our isolation and purification methods, it eliminates the need to rely on China for the final steps in the refining process. That's where we are as a country today. Really, the whole world needs to rely on China for that final step of the refining process. That final step also needs to be low-cost and environmentally safe and have the ability to process and purify a variety of feedstocks. That's what our chromatography solution brings to the market. And again, these are major priorities for the United States to enter the market and to truly compete. Our isolation and purification message is focused on taking a proven and commercial technology, chromatography -- our chromatography solution. I want to repeat that. chromatography is a proven and commercial technology. It's been used for decades in the pharmaceutical industry, the food and beverage industry and the chemical industry, and we're applying it to the critical and rare earth element industry today. We realize there is an urgency in our execution. With where we stand today, we believe we are redefining how these materials are sourced and processed and believe we will be the first in the United States to be commercially isolating and purifying critical and rare earth elements and the first in the world to use our specific environmentally safe and low-cost methods. We have the patented technology. We have the processes in place, and we put together our team. And our team is really going to bring us to success, whether it's with our sponsored research programs at some of the most leading chemical engineering departments in the country with Penn State University, Texas Tech university and Purdue University. Whether it's with the folks on the phone today, we brought in Jeff Peterson, to spearhead our execution in our day-to-day operations of expediting all of our processes to get to a commercialized state. We've brought in talent from the pharmaceutical industry, like Bill Smith, who spent 33 years at Eli Lilly, overseeing worldwide planning, design and construction of all of their capital projects, including all of their chromatography facilities. He's very intimate with the technology, and he's overseeing the build-out of our chromatography facilities as we speak. It's clear that we are being seen as an important and value-added solution to our domestic supply chain, especially as we develop some collaborative partnerships. As we continue to develop these partnerships and distribution channels for the aggregation points of end-of-life products to be recycled, such as EV batteries and permanent magnets. We're excited to be able to be more clearly define these partnerships as they continue to mature. And we feel that we'll be able to do that in the short term. An update on our chromatography facility. Again, we understand there's a sense of urgency, and we're highly focused on bringing that to a commercial state. As we previously announced, we finalized our site selection for a large-scale facility in Noblesville, Indiana, and we're in the build phase of a smaller scale facility, also in Noblesville, which should be operational in early 2022. We had to pivot; reason being, sourcing the material, sourcing the material like steel to build a 100,000-plus square foot facility with today's supply chain problems is very challenging. So we had to pivot and we had to procure a stand-alone facility, so we can start to execute on a smaller scale and then be able to scale and move that execution into our larger footprint. With the passing of the infrastructure bill, which includes funding to supply chain and clean energy technologies, we believe we are in a great position and align very well with our national priorities. Whether with traditional infrastructure, like roads, bridges and ports and the need for steel or for the advancement of green energy or clean tech infrastructure that is highly needed, battery and magnet metals. With where we are positioned today, we don't think American Rare Earth is being properly valued by the market, and we are actively looking at ways to unlock that value for all of our shareholders. With that, I'm going to turn it back over to Mark Jensen with any other comments that I'd like to add on American Rare Earth and also give some color on some upcoming milestones.

Thank you, Mark. American Rare Earth is a unique business that we've been able to attract some very attractive partnerships as well. We are currently working with suppliers, not only on the upstream, but also in discussions on the downstream side of our business line. We've established two windmill farms, wind turbine farms, were able to access their waste generators that have substantial amount of waste magnets to be recycled in that. We are currently actively working with other partners to source those additional feedstocks to supply the growth of this business and the ability to produce these purified isolated Rare Earth elements. As well as on the battery side, the battery market is a huge market and there is very few recyclers out there that can process down the element level for cobalt, nickel, manganese, as well as lithium. We've proven our technology can do that and proven we can do it at a low-cost platform. We look to showcase our technology in the coming year and showcase our ability to produce these elements at a cost-effective structure to be able to recycle them down to the audit level. We look forward to discussing these future partnerships and collaboration agreements in the near-term as we continue to drive this business forward. On the metallurgical carbon side of the business, we look forward to talking about our future off-takes and our future ramp-up of our additional production over the coming year to be able to capitalize on this current market environment. We also have our value -- our equity value initiatives that we put in place, including our SPAC as well as Novusterra. What I'd like to do now is to turn it over to our Chief Financial Officer, Kirk Taylor, where he could talk about some of these value-creation initiatives as well as our -- walk through our financials from the latest quarter early report.

Thanks, Mark. Thank you, everybody, for your time as well this morning. I want to cover off a couple of the high-value value-creation initiatives that we have previously announced versus the sponsorship of our SPAC, America Acquisition Opportunity, Inc., which we sponsored and went public, just at the end of March, raising about $106 million, which we have obligation to deploy in a merger to bring a high-value private company to the public market. We are working through that leaseback process now with a high-value target that really focuses on industry in transition where we can utilize the skills that we've learned over the past seven years of American Resources transforming the infrastructure market. We ultimately believe that all American REITs, our shareholders, will get attribution of value through this transaction, that is, again, not currently reflected in our market cap. The other item that we've previously announced is a sub-license agreement with Novusterra. Novusterra is doing a phenomenal job of growing their team, going through the public process and expanding their capabilities as it relates to sub-license agreements. Just today they announced the hiring of the high-impact CFO that will really raise the bar on their execution. We view this partnership as a very low-risk way about outsourcing the development and commercialization of these patterns that will create synergies with American Resources, and have the opportunity to create meaningful value to our shareholders. Again, both the SPAC opportunity, as well as our sub-licensing agreement showcase our nimbleness and our desire to create a shareholder focused culture within American Resources. We currently don't believe that the Novusterra sub-licensing agreement is capturing our market cap either, further unlocking value down the road. I also want to cover-off financial highlights at our recently concluded quarter and nine months ended September 30, 2021. Through the third quarter, we further -- we worked extensively hard to further strengthen our balance sheet; we eliminated over $8.5 million of debt and payables. As a result, we're extremely excited to have any disclosures around risk of growing concern removed from our financial statements this quarter. Really there are three reasons for this; one, was the elimination of a significant amount of debt and payables. Two, was our strong cash position. And three, was the recommencement of our carbon operations coming out of restructuring and the COVID epidemic. Additionally, last week we were successfully able to exit our new market tax credit loan; successfully going through seven years of compliance, this was the first external capital that we raised in 2016. It created over 45 direct jobs, hundreds of indirect jobs; it was really a boost of the company that we are now. Navigating the program netted our company $1 million of benefit, as well as creating the platform for us to grow through Perry County, , Kentucky, as well as in the Wyoming County, West Virginia, impacting many communities where no one's willing to invest dollars when we were. We didn't stop there, we invested over $13 million in our current operations; including in mine development, mining equipment, surface equipment. But what was even more exciting is we started procuring long lead items for the purification facilities in Noblesville that Mark spoke about. It's exciting to see our company transition and invest capital for these high-impact areas. Our debt balance clearly sits at only $17 million; $2.6 million of which is equipment financing, $12 million is convertible notes and the long-term partners, and $2.7 million in the form of our outstanding PPP loan. Our shares outstanding right now fit just over 61 million Class A common shares. And our -- we concluded the third quarter with cash on-hand of over $19 million. Again, our balance sheet and our capital structure have never been stronger. We've never been in a position to grow more efficiently and more meaningfully than we are now. We value your time, we're continuing to strive hard to execute on our innovative growth plans, and we're happy to share these updates as we're able to. At this point, I want to turn it back over to the moderator to begin our Q&A portion of the call.

Thank you. Ladies and gentlemen, at this time, we will be conducting a question-and-answer session. Our first question comes from the line of Kyle Gallagher with Merrill Lynch. Please proceed with your question.

Hey guys, thanks for the call. Mark, just a quick question on profitability. I think I had asked a question last quarter. Actually I have two questions, but I had to ask a question on last quarter on profitability. At that time, you had said, kind of from then on, you expected to be profitable. I took that as, at that point in the quarter, so not necessarily assuming Q3 would be. One, can you give us some color on that? Should we be expecting kind of profitability here in the -- in Q4? And then, can you give any color -- do you guys feel that you're in a financial position that you'll kind of have enough cash on the books to really be able to build out the Rare Earth side of the business? Or do you feel like you're going to need to raise capital in some way via loans or a share offering to get that completed? So, any color on those two items that you could give would be much appreciated. And then, also two; appreciate the Twitter updates. I'm not actually on Twitter, but I do check in on them and always appreciate seeing some of that coal come out of the ground and things of that nature; so we'd love to see those keep coming. Thanks, guys.

Yes. To answer your questions; we're not giving guidance on the balance of the year with regards to our profitability. But based on the current market and current sales we have, and the current production, I would say it's looking very good in the month of December. And based on our book of sale or order book for 2022, it is a very high-margin book of business. It's -- we're seeing prices double what we initially thought we were going to see, and those are the orders that we have. In front of us today was the order book that we referenced, which would put us in a position where -- just to take a step back, as Kirk had mentioned, we invested heavily into this business during the last -- over the last year, and really up until where we're at today. Why we did that was to position the business to be steady and stable from a production perspective as we got these new mines back online. We didn't forecast, and I can't say we forecasted pricing being where they're at today, nobody in the industry did. We did forecast there was a substantial shortfall of supply, given the lack of investment into the carbon industry. And most of our competitors are diversified and thermal coal has obviously been challenged; and we don't produce that. So we're in a unique spot because we invested so heavily into the mining equipment and to the mines that we have today to continue to ramp up and grow this business very cash flow positively going into the new year. We don't anticipate having to raise additional capital to execute our business model. We do believe our margins from our mining side are substantial given, as I mentioned, our current order book is almost double what we thought it was going to be in terms of price structure going into the new year. In terms of the Rare Earth business, I think we actually very well capitalized that. When we have $19 million of cash that will be coming in the end of the quarter, we've already started procuring the components for the processing plant for our chromatography, final stage isolation and purification and investing into that chromatography technology. The unique aspect of what our chromatography technology is, is it's quite different than the alternative in the world, which is solvent-based extraction. Solvent-based extraction is a thousand different settlement ponds and tanks that are using heavy acids and expensive acids to isolate and purify elements through settlements. Chromatography is quite different than that, it's an affinity-based chromatography technology that is substantially lower cost to implement and substantially lower cost to operate. And so we have already started spending on that in the current quarter, and we believe we have more than adequate capital reserves to be able to execute on the Rare Earth business, as well as execute on our ramp-up of our mining operations, and we'll be spending cash flow going into the new year, and actually generating positive cash flow at that point. In terms of the Twitter updates and shareholder updates that we provide; we put a substantial value on the fact that we have a large retail investor base. We also had -- are starting to build a bigger institutional investor base. At the end of the day, we believe this company is owned by it's shareholders and should be run for the benefit of it's shareholders and it's employees. And so providing those updates are the best we can, we take pride in that. We want to win as an organization, and we want to share our progress and our updates as often as we can to showcase where the capital is being spent within the company and what is being done to succeed and win as a company for the benefit of all of our shareholders. So at the end of the day, the quickest way to do that is to provide these updates as best we can, and we will continue to do so.

Yes. I appreciate the color on those two items. If you don't mind, just -- and listening to you talk, are you guys seeing significant wage pressure for new employees coming on? Or -- you know, I know you're talking about procuring a lot of equipment there; in the past, you would have done sort of on an ad-hoc basis. I think, obviously, that's a pretty smart thing to do as supply chain seems like for everything is pretty heavily disrupted. Are you seeing a lot of price pressure on appearing wages and then accruing those wages? Thanks a lot.

Yes, that's a good question. I mean, one, I think in terms of staffing and in terms of our team that we have at the operations, we look to pay our people right but we also look to get them the supplies and tools they need to actually do their jobs. So we've invested heavily to make the mines and make the operations a safer place to work, investing into the belt lines, investing into the infrastructure; so when they show up to do their job, they can do their job. And that's -- I mean -- and we're buying assets that were previously out of bankruptcy; so they needed reinvestment and they need to work. But one thing that's unique about our company, and you look at the industry as a whole, I mean there's -- especially in our region of the world, there's -- a lot of our competitors don't have the balance sheet that we have and the capital that we had to invest, in at the time when we invested. And so, buying good equipment and buying equipment that is in better shape is safer equipment and more functional equipment, which ultimately means that our margins will look better going into the new year because of the quality of equipment that -- I mean, if you look at our company Twitter page and social media accounts, we showcased some of the imagery of this equipment; it's first-class equipment. In terms of taking -- in terms of benefiting our shareholders, going into the new year with the current order book, prices are extremely strong and very high margin for our business. And that cash flow, we look to share with our shareholders, as well as look to share with our team. As we share with our team, our team produces more, and we generate more shareholder value. At the end of the day, if you take care of your team members and you take care of your staff, then at the end of the day, they take care of our shareholders; and we believe in that. We believe that everybody should win; and as they produce more, we will share that. So, we are -- I'll be actually at the operations this week, and we're going to be discussing with all of our team that we're implementing in very short order, a clean ton bonus for the men and women at our operations because at the end of the day they could all benefit from these higher prices we're seeing. But at the end of the day, the margins we're seeing are substantially higher than what we forecasted going into the new year as well. So, are we seeing higher wages? I mean, we like to share more with the employees as we generate more cash flow, share some of that with the workers and the team. So at the end of the day, they want to perform more for the investors too, and they do; they absolutely understand that we're a public company, and they absolutely understand that we have shareholders out there that are putting confidence in them. And so that at the end of the day, we are letting them take advantage of that and benefit from that as well and where everybody wins together. In terms of competing for labor, though, it's -- as I said, a lot of our competition in the region is running older equipment, equipment that's breaking down, they're not investing as heavily into the operations; so we've been able to attract a good labor force. We've been able to attract a really good team, and we continue to do so. We run job fairs all the time, we talk about the benefits we offer, covering a substantial amount of their health insurance premiums and setting it up in that way where at the end of the day, we're not out there spending money where it doesn't need to be spent, we're spending it where it's important, and we believe spending it on our team is important. But we're not seeing outlandish incremental cost of labor; we're seeing normalized increased cost of labor, that is -- but our margins are going to show substantial strength compared to where we ever thought they were going to be. But we're also setting it up in a way that should the market come down two, three years from now; at the end of the day, we can adjust fire on that but without the expense of hitting directly at the employee level. So trying to forecast not only for the next year but look out two to three years and set it up in a way where everybody wins together.

Awesome. Thanks, Mark. I appreciate it.

I appreciate you. Thanks for joining.

Our next question comes from the line of Steven Siegel with KBC Asset Management. Please proceed with your question.

Hi Mark, thank you for the update; very informative and great. Just wondering, can you provide a little more detail on your order book and possibly what other properties would come online down the road, assuming that this stays really strong because of the infrastructure bill and the demand out there?

Yes. Thanks, Steve. Absolutely. So, what our current order book is based on is purely based on the two operating mines we have in place today, and the production that will be on the -- will be fully run rate hitting those production rates by the end of this year. We didn't want to talk about an order book of mines that weren't producing; obviously, we've -- if things happen slower and the world environment is getting things done as timely as we used to be able to do them is harder, so we want to focus on making sure that as we're planning, we're only planning based on the items that we actually can absolutely see because they're currently running. So we look at our current order book today, it's extremely strong; it's -- there is no limit to ability of what we can sell based on what we currently can produce at our operations. And we're seeing prices that are over double that we -- when we originally started -- like for the McQuay Complex , for example, when we were originally getting ready to start this complex, we looked at around high-70s was the make or break decision of should we invest in this complex to get it up and running? And do we want to do that now? Where we're at today is we're north of 170 of where we see pricing at the mine site. So if you equate that back, we're effectively seeing what you see in the market. We're seeing -- I mean, these are substantial price appreciations based on the production we see at these operations, and the Perry County complex is very similar. Where we're currently at from -- at the mines, as I mentioned, we have Carnegie 2 is in development, Carnegie 3 we're starting development on, the Carnegie Surface mine starting development on; so we are forecast -- we are looking at other operations to bring online as well as our Wyoming County division. Our Wyoming County is the highest quality of met carbon you can produce in the United States, it's a mid-vol -- pure mid-vol product in a very high-quality scheme, and the beauty of it is it's a virgin operation. So that at the end of the day, you're not traveling through a bunch of old works or a lot of rehab to get it up and running. We paid $20 million for this complex a few years ago, and we're looking at starting the development TomaHawks at , and having substantial conversations with some partners that can help us expedite that in the future. Now that being said, we will provide updates on that when we do that, and we won't talk about those order books until we have them in place until those operations are up and running. But right now, we do see very strong inflows and internal demand for the product that we are currently producing, and are in a run rate to be producing by the end of this year for that current order book.

Okay. Thank you very much.

Thank you, Steve. We appreciate it.

There are no further questions in the queue. I'd like to hand the call back to Mr. Jensen for closing remarks.

I want to thank everyone for taking a few minutes out of your day to let us tell our story and where we're going as a business and where we're at. We couldn't be more excited about the strength that we see in the carbon business, but also the electrification marketplace. The ability for our team to have the ability to do something that is not done in the United States today is a big deal. To be able to isolate and purify Rare Earth and critical elements is substantial, and we don't take that lightly. And we don't take lightly that investors have invested into our business; from the institutional side to the retail side. The management of this company are all investors in this business first. We have invested our own capital into the company, and we're in this for the equity value of the business. We're excited about where we're at, we're excited about where we're going. We have an opportunity in front of us to capitalize on this current market environment because of our ramp-up of production at the operations, but also because of the technology and the team and effort that our team has put forward. And I want to thank our entire team across the board on the carbon side, the metal side, through our Rare Earth division, including our partners at the universities at Purdue University, Texas Tech and Penn State University. We have very strong partners that are dedicated in succeeding and dedicated in showing that our technology is world-class. Thank you all for joining, and I look forward to providing additional updates here in the coming months and coming quarters. Thank you so much.