Executive Summary / Key Takeaways

• Comstock is undergoing a strategic transformation from a legacy miner to an innovator and commercializer of decarbonizing technologies, focusing on renewable fuels from biomass and electrification metals from recycling, aiming to unlock significant value.
• The Fuels segment, soon to be spun off as Bioleum, is leveraging market-leading yields (up to 140 GGE/ton) and strategic partnerships (Marathon (MPC), NREL, Hexas) to target 8 billion gallons/year production by 2035, fueled by a planned Series A financing targeting at least $50 million.
• The Metals segment is rapidly scaling its R2 Certified, zero-landfill solar panel recycling solution, demonstrating strong revenue growth (Q1 2025 billings nearly 4x 2024 total) and securing key customer agreements (RWE (RWEOY)), with plans to build industry-scale facilities and projected annual revenues of $65M-$75M per 100k-ton facility.
• The Mining segment is capitalizing on rising gold and silver prices, planning preliminary economic analysis and development for its Dayton Consolidated resource, which shows robust potential cash flow (approx. $0.25B pre-tax net cash flow at $2300 gold) and is supported by dedicated capital commitments.
• While facing recurring net losses and needing external financing, LODE is pursuing subsidiary-level funding, asset sales (targeting over $50M), and strategic partnerships to fund growth and minimize parent-level dilution, positioning for potential multi-billion dollar valuations across its distinct business lines.

A Transformation Underway: From Historic Lode to Decarbonization Leader

Comstock Inc. (NYSE:LODE), rooted in the legacy of the historic Comstock Lode mining district, is executing a profound strategic pivot. Over the past few years, the company has actively transformed itself from a traditional junior miner into an innovator and commercializer of technologies aimed at extracting and converting under-utilized natural resources into clean energy products. This involves pioneering work in producing renewable fuels from waste biomass and recovering electrification metals from end-of-life electronics. This strategic evolution is not merely an addition to its historical mining roots but a fundamental reorientation, positioning LODE at the intersection of resource extraction and the burgeoning clean energy transition.

The competitive landscape LODE operates within is diverse, spanning established precious metals miners, large-scale lithium producers, and emerging players in renewable fuels and recycling. In traditional mining, companies like Hecla Mining (HL) and SSR Mining (SSRM) boast significant scale, diversified operations, and established production profiles, giving them advantages in market share and operational efficiency. In the battery metals space, giants like Albemarle (ALB) dominate lithium production with vast resources and global supply chains. LODE, with its Nevada-focused mining assets, is a smaller player in these traditional markets, facing disadvantages in scale and historical profitability compared to these larger, established competitors. LODE's historical financial performance, marked by recurring net losses and negative margins (e.g., TTM Net Profit Margin of -1157.26%), stands in stark contrast to the often positive, albeit sometimes volatile, margins of its larger mining peers.

However, LODE's strategic response lies in technological differentiation and a focus on emerging, high-growth markets within the energy transition. The company is not competing head-to-head on scale in conventional mining or lithium production but is carving out a niche through proprietary processes and sustainable solutions.

Technological Edge: The Engine of Transformation

At the heart of Comstock's strategy is its investment in differentiated technology across its core segments.

In the Fuels segment, the company's lignocellulosic biomass refining solutions are designed to convert waste wood and energy crops into renewable fuels with market-leading performance. Management highlights yields of up to 140 gasoline gallon equivalents (GGE) per dry metric ton of feedstock and extremely low carbon intensity (CI) scores of 15. This yield is stated to be easily double that of the next competitor, providing a significant advantage in feedstock efficiency. Strategic R&D initiatives, including partnerships with NREL/MIT and Emerging Fuels Technology (EFT), aim to push these yields even higher (targeting over 140 GGE/ton with EFT's gas-to-liquids bolt-on) and drive down costs towards fossil parity. The NREL/MIT collaboration specifically targets breakthroughs for lower CI scores and reduced operating and capital costs. The "so what" for investors is that this technological superiority in yield and carbon intensity directly translates to potentially higher revenue per ton of feedstock and a stronger competitive position in a market increasingly driven by sustainability mandates and economic efficiency.

In the Metals segment, LODE's proprietary thermal recycling methods for end-of-life solar panels are the core differentiator. The company has achieved R2v3/RIOS certification, specifically Appendix G, validating a zero-waste, 100% landfill-free recycling process. This means all components – glass, aluminum, semiconductor fines, and other metals (including silver) – are fully recovered and repurposed into commodity-ready products. This capability is stated to be unique in North America and provides a "tremendous competitive advantage," allowing LODE to offer a superior environmental solution compared to alternatives that may involve landfilling. The operational efficiency of this technology is demonstrated by the ability to process a panel in less than eight seconds at the planned industry scale. For investors, this technology creates a strong competitive moat, enabling LODE to win business even when transportation costs make its initial price higher, and opens up additional revenue streams from the sale of recovered materials beyond just tipping fees.

These technological advantages are foundational to LODE's strategy, enabling it to pursue high-margin opportunities in rapidly growing markets where sustainability and efficiency are paramount. While larger competitors may have scale, LODE aims to compete on the basis of superior process performance and environmental benefits.

Segment Performance and Strategic Momentum

Comstock's recent financial results reflect the early stages of this transformation, marked by significant R&D investment and the initial ramp-up of new operations. For the three months ended March 31, 2025, the company reported total revenue of $785,815, a notable increase from $425,951 in the comparable 2024 period. This growth was primarily driven by the Metals segment, which generated $748,765 in revenue in Q1 2025, largely from decommissioning services and sales of recycled materials. This segment's billable revenues (recognized and deferred) more than tripled in Q1 2025 ($1.34 million) compared to the entire year of 2024 ($401,238), demonstrating rapid operational traction and market acceptance, including securing a Master Services Agreement with RWE Clean Energy. Despite this revenue growth, the Metals segment reported a loss from operations of $745,373 in Q1 2025, as costs of goods sold increased significantly ($886,796) due to the initial operation of the demonstration facility at less than full capacity and aggressive investment in establishing the platform (permitting, building, logistics). Management expects Metals billable revenues to be six to eight times greater in 2025 compared to 2024, exceeding the previous guidance of $2.5 million and now targeting over $3 million. The outlook includes scaling up to a 50,000 tons/year industry-scale facility in 2025 ($6M CapEx) and then 100,000 tons/year ($3M additional CapEx), targeting breakeven by the end of 2026 and projected annual revenues of $65M-$75M at 100,000 tons/year capacity with robust cash margins.

The Fuels segment did not generate revenue in Q1 2025 or Q1 2024, reflecting its development stage. It reported a loss from operations of $2.66 million in Q1 2025, up from $1.03 million in Q1 2024, primarily due to a significant increase in research and development expenses ($3.30 million in Q1 2025 vs. $892,013 in Q1 2024). This R&D increase was driven by a non-cash charge related to a strategic commitment settlement ($1.49M paid in stock for AST lease amendment) and higher costs for collaborations with external laboratories (NREL, MIT, RenFuel, EFT) and increased personnel. Strategic progress in Fuels has been substantial, including the investment and asset transfer from Marathon Petroleum (valued at $14M, including the Madison facility), integration of the Wisconsin pilot facilities (enabling production up to two barrels per week), securing $1M of a $3M Oklahoma grant, and advancing site selection for the first commercial demonstration facility in Oklahoma. Management is targeting the closing of a Series A funding round for Fuels (at least $50M) in Q2 2025, which is expected to significantly fund the segment's development and relieve liquidity pressure on the parent company. The long-term vision is ambitious, aiming for 200 million barrels/year (8 billion gallons/year) production by 2035 through owned facilities and global licensing agreements (already signed with SACL, Greshams).

The Mining segment, while historically core, is now positioned for monetization and focused development. Revenue decreased significantly to $32,250 in Q1 2025 from $421,151 in Q1 2024, primarily due to the termination of the Mackay Mining Lease in late 2024. Despite this, the segment reported a net income of $1.77 million in Q1 2025, benefiting from other income. The sale of northern mining targets to Mackay for $2.75 million plus a royalty in late 2024 (with $1M cash received in 2024 and $1.75M due) contributes to planned monetization efforts. The focus is now on the Dayton Consolidated Project, with plans to invest $1M-$2M in 2025 for preliminary economic analysis and resource expansion towards proven and probable reserves. Management highlights the project's potential for approximately $0.25 billion in pre-tax net cash flow over a six-year mine life at $2300 gold, a figure enhanced by current higher gold prices. The segment's objectives for 2025 include receiving over $2M cash from prior leases/sales, commercializing central claims, and completing preliminary mine plans for southern claims.

Overall, Comstock reported a net loss of $9.09 million for Q1 2025, compared to a net loss of $6.92 million for Q1 2024. The accumulated deficit stood at $344.74 million as of March 31, 2025.

Cash and cash equivalents increased to $3.91 million at March 31, 2025, from $954,271 at December 31, 2024, primarily due to $9.73 million generated from financing activities in Q1 2025, which offset cash used in operations ($4.96 million) and investing ($1.82 million). The company's working capital excess was $7.08 million at March 31, 2025.

Outlook, Risks, and the Path Forward

Comstock's outlook is centered on accelerating the commercialization of its decarbonizing technologies and unlocking value through strategic transactions. The most significant near-term catalyst is the planned spin-off of the Fuels segment into a separate, well-capitalized public entity, Bioleum Corporation, following the closing of the Fuels Series A financing in Q2 2025. This separation is intended to create two distinct, high-growth companies – a Nevada-based metals and mining company (Comstock Inc.) and an Oklahoma-based renewable fuels company (Bioleum) – each with tailored capital structures and management focus.

For the Metals segment, the outlook includes maximizing production at the demonstration facility, securing funding for scale-up ($6M CapEx in 2025), completing permitting for the first industry-scale facility (expected Q4 2025), procuring equipment, securing additional MSAs, and selecting sites for two additional facilities. Management expects 2025 billable revenues to be well over $3 million, with significant increases as industry-scale facilities come online.

For the Fuels segment (Bioleum), the focus is on closing the Series A financing (targeting at least $50M), completing site selection for the first Oklahoma commercial demonstration biorefinery, securing project-level financing ($250M project cost, including $152M Oklahoma bonds), executing additional licensing/commercial agreements, and expanding integrated pilot production capabilities. The long-term target is 8 billion gallons/year by 2035.

For the Mining segment, 2025 objectives include receiving cash from prior asset sales/leases, commercializing central claims, completing preliminary mine plans for southern claims, and commencing work to upgrade the Dayton resource. Asset monetization, including non-mining real estate and water rights (targeting over $50M in 2026), is a key corporate objective to enhance liquidity.

Despite the ambitious plans and strategic momentum, significant risks remain. The company's history of recurring net losses and accumulated deficit raises substantial doubt about its ability to continue as a going concern if it cannot secure necessary additional funding. Liquidity is dependent on successful execution of financing plans (Series A, subsidiary financings, equity issuances under the shelf registration, asset sales) and managing operating expenditures, which are projected to be over $20 million in 2025 (including R&D and payroll). Operational and technical difficulties inherent in scaling up new technologies, permitting delays, volatility in commodity prices (gold, silver, recycled materials), and intense competition in each market segment could all adversely impact financial performance and the ability to achieve stated objectives and valuations. The ability to attract and retain key personnel and manage complex strategic partnerships and the planned spin-off are also critical factors.

Conclusion

Comstock is in the midst of a transformative journey, leveraging its historical resource expertise and investing in cutting-edge decarbonization technologies to pursue high-growth opportunities in renewable fuels and electrification metals recycling. The strategic pivot, highlighted by the planned spin-off of the Fuels segment and the aggressive scaling of the Metals business, aims to unlock significant value by allowing each distinct entity to attract dedicated capital and focus. While the company faces financial challenges, including recurring losses and the need for substantial external funding, the progress in securing strategic partnerships, validating technology performance (market-leading yields in Fuels, zero-landfill certification in Metals), and demonstrating operational traction (rapid revenue growth in Metals) provides a foundation for its ambitious outlook. Investors should closely monitor the execution of the Fuels Series A financing and spin-off, the progress in scaling the Metals recycling operations and securing long-term supply contracts, and the advancement of the Dayton mining project as key indicators of the company's ability to translate its technological potential and strategic vision into sustainable financial success and shareholder value.