Evercore energy analyst James West recently hosted me for a discussion spanning the lithium market, KMX’s unique technology, and the company’s goals for the year. Notably, during the discussion, I laid out KMX’s three internal goals in response to James’ question.
This update dives deeper into all three of these goals and provides some brief highlights around other exciting initiatives that are unfolding and on our radar.
James: What are KMX’s strategic objectives for 2022-2023 and when we sit here a year from now, how will we know you’re on track for success?
Zac: This year is all about our demonstrations – Cornish Lithium and CleanTech Lithium and operational readiness. (Our main objectives are):
- Executing on our demos
- Expanding our commercial backlog
- Enhancing our technology
Goal #1): Executing on our demos:
The team’s top priority for the year is successfully executing on client demonstrations. In the months ahead, we expect to conduct technology tests for various customers utilizing our Generation III technology, with demonstrations conducted by both third-party researchers (to validate results) and our technology team.
While we anticipate successful demonstrations, particularly following the recent successful lab-scale lithium test conducted with our Gen III membranes, there is much work to do, including upgrading and scaling equipment for our commercial sized membranes. We hope to share test and demonstration results as they become available in the months ahead.
As the team ramps up for upcoming pilots and lab trials, we are excited to expand the operations team with the addition of Najam Abbasi as an Operations Manager. Najam is a seasoned project manager who has worked with much of the KMX team for several years. Najam will support Chris Kelley, who leads operations for KMX, and will assist with nearly all aspects operational readiness, with a particular focus on supply chain and logistics management.
We hope to expand the team further as we expand operations and commercial efforts and are excited to welcome Najam onboard as the most recent addition.
Goal #2): Expanding our commercial backlog:
Since our last update earlier this month, the commercial team has had a number of new and exciting conversations with potential customers and partners that range in regional focus, size, and specialization. The bulk of the commercial team’s efforts, led by Alexander de Vogel, are concentrated on lithium; however, new opportunities span critical minerals, oil & gas wastewater (which also contains lithium in many cases), and industrial water treatment.
As I highlighted to James, due to bandwidth constraints we will continue to be thoughtful about which customers we take on and which institutions we partner with. In the lithium space, we are working with, in my view, two of the most ecologically conscious and technology savvy project developers developers (Cornish Lithium and CleanTech Lithium). Our commercial strategy will continue to account for holistic project developer considerations, including 1) water stewardship, 2) stakeholder engagement, and 3) next generation technology incorporation.
Notably, we firmly believe lithium project developers that prioritize the protection of water resources will enjoy more local stakeholder support, improve their speed to market, and attract high-quality and equally environmentally conscience off-take partners. As such, we are keen to work with companies that fit this profile.
While we have not announced a formal commercial goal for the year, beyond our current backlog we hope to add at least a couple additional commercial agreements in the lithium space this year, as well as at least one strategic sales channel partnership.
In the critical minerals space (including for Rare Earth Elements), we are currently exploring partnerships related to ways to proliferate our technology in new markets and in new ways. We hope to be sharing more on this soon!
Goal #3): Enhancing our technology:
Due to the extensive development of our technology, which spans over 15 years, and due to the significant capital and intellectual resources this endeavor has realized, we remain highly focused on maintaining what we believe is a one-generation (or five- to seven-year) technology lead on the competition.
As such, enhancing our technology and expanding our IP portfolio is also one of our three main goals for the year. The technology team aims to continuously enhance the defensibility of our IP portfolio through a variety of approaches, while hopefully furthering our technical leadership through additional laboratory research conducted this year.
Thoughts on the US Lithium Market:
As part of the discussion, I highlighted how the U.S. is positioned to potentially capture an outsized portion of the unfolding boom in lithium demand in my view as a result of 1) continual technology improvement, 2) supportive government policies (particularly when project developers get sustainability and local stakeholder engagement right), 3) shared infrastructure, and 4) an increasingly captive market for lithium capital markets.
This scenario in many ways mirrors the U.S. unconventional oil & gas development experience, where the U.S. was able to become the largest producer globally despite its modest resource base relative to other hydrocarbon-rich nations.
We are extremely excited about the prospect for lithium development in many regions, including in South America as well as the UK and EU; however, we believe KMX’s core technology is well-positioned to play a leading role in bringing unconventional and lower concentration lithium to market while preserving freshwater resources.
It is an exciting time for KMX, the lithium market, and the critical mineral and water treatment markets. We hope to update you as some of these exciting milestones are met and to provide insights on unfolding developments in the weeks and months ahead.