Key Takeaways AREC and ReElement extended their antimony refining agreement to a 10-year term with auto-renewals. The revised deal will generate more than $29M annually from purified antimony for defense and commercial use. ReElement begins processing 500 metric tons/month of stibnite ore, with capacity set to grow with demand.American Resources Corporation (AREC) , and its portfolio company, ReElement Technologies Corporation, recently announced an expansion of their existing antimony tolling agreement. ...

Coal Production and Operations - The company has not mined or sold thermal coal since mid-2019, with all mining operations currently idled due to adverse market conditions [196]. - In 2023, the Carnegie 1 Mine produced approximately 67,000 tons of coal, selling at an average price of $180 per ton [200]. - The Carnegie 2 Mine produced approximately 13,000 tons of coal in 2023, with an average selling price of $237 per ton [201]. - The McCoy Elkhorn subsidiary has an estimated capacity to produce up to approximately 40,000 tons of coal per month from Mine 15 when operational [199]. - The company holds 11 additional coal mining permits that are idled or in various stages of reclamation, with no current plans to bring them into production [208]. - Wyoming County Coal holds approximately 5,668,000 tons of coal deposits, with no current production from its mining permits [224]. - The E4-2 mine in Perry County has an estimated production capacity of 80,000 tons per month, but produced only 106,000 tons in 2022 due to adverse market conditions [235]. - The Davidson Branch Preparation Plant has a capacity of 1,300 tons per hour but is currently not operating due to idled mining operations [236]. - The company has approximately 200 mineral and surface leases required for its coal mining operations [245]. Financial Performance - Total revenue for the three months ended March 31, 2025, was $31,927, a decrease of $62,092 compared to $94,019 in 2024, primarily due to a reduction of $64,667 in royalty income [258]. - Total operating expenses decreased by $1,808,844 to $5,015,360 for the three months ended March 31, 2025, driven by lower coal production costs and reduced professional fees [259]. - Net loss attributable to AREC shareholders for the three months ended March 31, 2025, was $6,652,763, a decrease of $288,600 compared to a net loss of $6,941,363 in 2024 [258]. - Cash used in operating activities for the three months ended March 31, 2025, was $1,434,850, a decrease from $4,726,617 in 2024 [264]. - Cash provided by investing activities was $741,401 for the three months ended March 31, 2025, compared to cash used of $432,642 in 2024 [265]. - Cash provided by financing activities was $76,799 for the three months ended March 31, 2025, a significant decrease from $148,262,883 in 2024 due to the absence of bond issuances [266]. - As of March 31, 2025, the company had a cash balance of $24,623 and a working deficit of $75,839,150, indicating liquidity challenges [263]. Capital Expenditures and Investments - The company has expended approximately $32,500,000 of the $36,500,000 initial project fund for Wyoming County Coal as of December 31, 2024 [228]. - The purchase price allocated to the Wyoming County Coal property was approximately $22,300,000, primarily settled with shares of the Company's Class A Common stock [230]. - The company had no material commitments for capital expenditures as of March 31, 2025 [268]. Business Diversification - The company has diversified its revenue streams by establishing subsidiaries focused on metal recovery and rare earth elements, with ReElement Technologies LLC being one of them [194]. - The company anticipates increasing revenues from its new ReElement and Electrified Materials businesses in 2025, but will require cash flows from financing activities to support operations [262]. Operational Capacity - The Supreme Energy Preparation Plant, a 400 ton-per-hour facility, is currently idled and would require significant capital to bring back into operation [215]. - The Bevins 1 Preparation Plant has a raw coal stockpile storage capacity of approximately 25,000 tons and clean coal stockpile storage of 100,000 tons [203]. - The Mill Creek Preparation Plant has an operational capacity of 800 tons per hour, but currently utilizes less than 10% of this capacity [220]. Other Financial Metrics - The increase in net other expense was primarily due to a decrease in interest income of $485,630 and an increase in interest expense of $1,089,817 compared to the same period in 2024 [261]. - The company employs approximately 23 direct employees and is headquartered in Fishers, Indiana [256].

Coal Production and Operations - American Resources Corporation has not mined or sold coal into thermal coal markets since mid-2019, with all mining operations currently idled due to adverse market conditions[20]. - In 2023, the Carnegie 1 Mine produced approximately 67,000 tons of coal, selling at an average price of $180 per ton[27]. - The Carnegie 2 Mine produced approximately 13,000 tons in 2023, with an average selling price of $237 per ton[28]. - The Wayland Surface Mine has an estimated capacity to produce up to approximately 15,000 tons per month of coal but has been idle since 2022[38]. - Deane Mining LLC operates one active underground mine (Access Energy) and one active surface mine (Razorblade Surface), with a total estimated coal production capacity of approximately 28,000 tons per month[47][48]. - Access Energy has not produced any coal since its acquisition, focusing instead on metallurgical and industrial markets[47]. - Razorblade Surface began production in mid-2018, with an estimated capacity of 8,000 tons per month, but has also seen nominal coal extraction[48]. - Coal sales for the company were primarily from the Carnegie 1 and 2 mines in 2023, with no meaningful sales from coal production in 2024[82]. Coal Deposits and Mining Permits - As of December 31, 2024, approximate coal deposits owned are 0 tons and leased are 11,108,724 tons, with minimum annual lease payments of $20,000[25]. - Knott County Coal holds 22 idled mining permits, with approximate coal deposits owned at 0 tons and leased at 3,207,000 tons[37]. - Wyoming County Coal LLC holds approximately 5,668,000 tons of coal deposits, with no current production and two idled underground mining permits[55]. - ERC Mining Indiana Corporation holds 4,383,298 tons of coal deposits in reclamation, with no current plans to mine the property[76][77]. Preparation Plants and Processing Capacity - The Bevins 1 Preparation Plant has a processing capacity of 800 tons per hour and can store approximately 100,000 tons of clean coal[30]. - The Bevins 2 Preparation Plant has a processing capacity of 500 tons per hour and can store approximately 45,000 tons of clean coal[31]. - The Supreme Energy Preparation Plant has a processing capacity of 400 tons per hour and is currently idled, requiring significant capital to bring back into operation[40]. - The Mill Creek Preparation Plant has an 800 ton-per-hour capacity, but currently utilizes less than 10% of its processing capacity[50]. - The Davidson Branch Preparation Plant has a capacity of 1,300 tons per hour but is currently not operating due to the idled status of mining operations[70]. Financial and Compliance Considerations - The purchase price allocated to the McCoy Elkhorn properties was approximately $95,000, while the Knott County Coal property was approximately $286,000[33][42]. - In June 2023, Wyoming County Coal closed on an Industrial Development Bond for $45 million to finance permit and infrastructure development, with $32.5 million already expended by December 31, 2024[60]. - The company retains exposure for the first $10,000 per accident for workers' compensation liabilities, which could significantly impact operating costs[112]. - The complexity and evolving nature of mining regulations may delay the commencement or expansion of operations, affecting cash flow[99]. - The company is subject to stringent health and safety standards under the Mine Act and MINER Act, which may increase compliance costs[110]. - The company incurs costs related to blasting activities, including pre-blast surveys and monitoring, which may impact operational costs[136]. Environmental Regulations and Impact - Compliance with environmental laws and regulations may lead to increased capital, operating, and compliance costs, potentially adversely affecting operations[89]. - Changes in applicable laws regarding energy production and emissions could make coal a less attractive energy source, adversely affecting demand[92]. - The Clean Air Act and related state laws impose emission control requirements that could materially affect coal mining operations and financial results[114]. - The EPA's Clean Power Plan (CPP) aims to cut carbon emissions from existing power plants, which could adversely impact coal demand if upheld[120]. - Several states have adopted measures requiring GHG emissions reductions, which may lead to increased operational costs for coal mining companies[121]. - The uncertainty surrounding GHG regulations may inhibit utilities from investing in new coal-fired plants, potentially reducing coal demand and revenues[122]. - The Resource Conservation and Recovery Act (RCRA) establishes standards for hazardous waste management, which could significantly increase coal mining costs if exemptions are reclassified[131]. - The EPA's regulation of coal ash as solid waste may increase operational costs for customers, potentially reducing coal demand[132]. - The Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) imposes cleanup requirements for hazardous substance releases, which could significantly impact the company's financial results[134]. - The company is subject to the Endangered Species Act (ESA) and the Bald and Golden Eagle Protection Act, which may delay or prohibit mining permits due to compliance requirements[135]. - Compliance with the National Environmental Policy Act (NEPA) can be time-consuming and may impose mitigation measures affecting coal production from federal lands[137]. - Recent guidance from the Council on Environmental Quality may lead to additional delays and costs in NEPA evaluations due to increased scrutiny on greenhouse gas emissions[138]. - The company must comply with various federal, state, and local environmental laws, which can result in operational delays and additional costs[139]. Workforce and Company Structure - The company employs approximately 23 direct employees and is continually evaluating the optimal mix of company employees and contract labor[140]. - The company qualifies as a smaller reporting company and is not required to provide certain market risk disclosures[217].

Core Viewpoint - American Resources Corporation (AREC) is expanding its operational equipment through its stake in ReElement Technologies Corporation to meet the increasing demand for domestically sourced rare earth oxides [1] Group 1: Expansion and Production Capacity - ReElement's latest equipment expansion showcases the modular and scalable nature of its refining technology, effectively doubling the facility's output of finished rare earth oxides in less than three weeks [2] - A third phase of expansion is underway, expected to triple production compared to Phase 2, significantly increasing daily output of essential rare earth elements such as neodymium (Nd), praseodymium (Pr), dysprosium (Dy), and terbium (Tb) [2] Group 2: Technological Advancements - The Noblesville facility utilizes cutting-edge refining technology to rapidly scale operations, addressing the exceptional demand from a growing customer base [3] - ReElement is committed to advancing innovation and operational excellence in refining critical minerals [3] Group 3: Stock Performance - AREC stock has declined by 3.9% over the past year, while the industry has seen a larger decline of 13.2% [5]

Core Viewpoint - American Resources Corporation (AREC) is developing a modular, mobile, and scalable leaching solution for extracting rare earth concentrates from coal and mining waste, addressing environmental concerns while creating potential revenue streams [1][2]. Group 1: Technology and Process - The new leaching solution allows for the extraction of rare earth concentrates from materials typically viewed as environmental burdens [1]. - ReElement Technologies will refine the leachate produced into high-purity rare earth products for domestic and allied-nation magnet manufacturers [2]. - ReElement has successfully produced high-purity rare earth oxides from various feedstocks, including coal waste, and is expanding its supply chain for critical minerals [3][4]. Group 2: Market Potential and Strategy - American Resources' properties contain millions of tons of coal waste, with early tests showing rare earth concentrations exceeding 500 ppm, indicating strong potential for domestic supply [5]. - The company is launching a platform to secure additional funding for scaling up production and is exploring financing options, including a Form D offering and a tokenized platform [5]. Group 3: Financial Performance - AREC stock has increased by 0.8% over the past year, contrasting with a 13.1% decline in the industry [7].

Group 1 - American Resources Corporation (AREC) has launched a new preparative scale sequential simulated moving bed (SSMB) production unit through its stake in ReElement Technologies Corporation, enhancing its capabilities in refining rare earth elements and critical materials [1] - The new technology represents a significant advancement for AREC in refining critical minerals, positioning the company as a leader in the domestic market for efficient refining solutions for vital materials [2] - The addition of a third dedicated chromatography line at AREC's Noblesville, IN facility will increase the daily refining capacity for essential rare earth elements such as neodymium (Nd), praseodymium (Pr), dysprosium (Dy), and terbium (Tb), while also expanding the range of minerals processed [3] Group 2 - AREC's investment in advanced technology highlights its commitment to scientific progress and scalable refining solutions, with plans to leverage this new capability for innovation in critical materials refining [4] - Over the past year, AREC's stock has declined by 73.1%, contrasting with a 6.1% decline in the industry [4] - AREC currently holds a Zacks Rank 3 (Hold), while other companies in the basic materials sector, such as Carpenter Technology Corporation, ArcelorMittal, and Axalta Coating Systems, have better rankings and performance [5][6][7]

Group 1: Joint Venture and Strategic Goals - American Resources Corporation's subsidiary, ReElement Technologies Corporation, has partnered with LVC Global Holdings to launch a joint venture named ReElement Middle East, aimed at enhancing the processing of critical minerals and strategic metals in the region [1] - The joint venture addresses the urgent need for localized and sustainable processing capabilities in Saudi Arabia, aligning with the country's Vision 2030 to establish itself as a global hub for critical mineral resources [2] Group 2: Market Demand and Supply Chain - The global demand for critical minerals is projected to quadruple by 2040, with over 75% of processing currently concentrated in China, creating vulnerabilities in the global supply chain [3] - The strategic alliance with LVC Global Holdings aims to secure a robust and resilient supply chain in the Middle East [3] Group 3: Sustainable Processing Solutions - ReElement Technologies aims to provide sustainable solutions for processing and refining critical minerals to battery, magnet, and semiconductor grades through this partnership [4] Group 4: Stock Performance - AREC stock has experienced a decline of 52.5% over the past year, compared to a 17.5% decline in the industry [5]

Group 1 - American Resources Corporation's subsidiary, American Infrastructure Corporation, is merging with CGrowth Capital, which will be renamed American Infrastructure Holding Corporation [1][2] - The merger involves a tax-free exchange of shares, with American Infrastructure's common shareholders receiving Series A preferred stock that can convert into common shares after twelve months [2] - This merger is a significant milestone for American Infrastructure, supporting growth initiatives through organic and strategic acquisitions, with a focus on a royalty and leasehold production model strategy [3] Group 2 - American Resources Corporation's stock has declined by 51.3% over the past year, compared to a 19.5% decline in the industry [4] - The company currently holds a Zacks Rank of 3 (Hold), indicating a neutral outlook [5] - In comparison, other companies in the Basic Materials sector, such as Carpenter Technology Corporation and MAG Silver Corp., have shown strong performance, with significant stock gains over the past year [6][7]

Coal Production and Mining Operations - The company has not mined or sold thermal coal since mid-2019, focusing solely on metallurgical coal for steel and specialty markets[64] - The Carnegie 2 Mine has an estimated capacity to produce approximately 10,000 tons of coal per month[68] - The Bevins 1 Preparation Plant has a processing capacity of 800 tons per hour and a clean coal stockpile storage of 100,000 tons[70] - The Bevins 2 Preparation Plant has a processing capacity of 500 tons per hour and a clean coal stockpile storage of 45,000 tons[70] - The company holds 11 additional coal mining permits that are idled or in various stages of reclamation, with no current plans to bring them into production[70] - Wyoming County Coal holds two idled underground mining permits and three permits associated with the idled Pioneer Preparation Plant, with no current production[77] - The Pioneer Preparation Plant has a capacity of 350 tons per hour, but no cost estimates for upgrades have been received yet[78] - The E4-2 mine has an estimated capacity to produce approximately 80,000 tons per month of coal, but was idled due to the COVID-19 pandemic and regional flooding[82] - The Davidson Branch Preparation Plant has a capacity of 1,300 tons per hour, but currently utilizes less than 10% of its available processing capacity[82] - Perry County Resources holds four additional coal mining permits that are idled or in development, requiring significant upfront capital investment for production[82] Financial Performance - Total revenue decreased by $5,721,840 for the three months ended September 30, 2024, primarily due to a reduction in coal sales[93] - Total revenue decreased by $16,120,841 for the nine months ended September 30, 2024, with coal sales being the main contributor to this decline[93] - Total operating expenses increased by $835,050 for the three months ending September 30, 2024, driven mainly by general and administrative expenses[95] - Total operating expenses decreased by $9,456,053 for the nine months ending September 30, 2024, primarily due to a reduction in coal production and holdings costs[95] - Net loss attributable to AREC shareholders was $9,206,768 for the three months ended September 30, 2024, compared to a loss of $2,360,828 in the same period of 2023[93] - The company reported a net loss of $21,909,367 for the nine months ended September 30, 2024, which was partially offset by adjustments totaling $6,415,477[97] Cash Flow and Liquidity - As of September 30, 2024, available cash was $161,651,732, with future liquidity needs expected to be met through cash on hand and future borrowings[96] - Cash used in operating activities for the nine months ended September 30, 2024, was $16,317,031, compared to $15,908,173 for the same period in 2023, reflecting an increase in net loss from $13,791,277 to $21,909,367[97] - Cash used in investing activities decreased from $3,862,383 in the nine months ended September 30, 2023, to $1,757,837 in 2024, primarily due to a reduction in purchases of investments[98] - Cash provided by financing activities significantly increased to $145,336,288 for the nine months ended September 30, 2024, compared to $45,671,490 in 2023, driven by proceeds from tax-exempt bonds of $149,719,203[98] - The company anticipates monthly compliance costs of approximately $35,000 as a public company, which will be covered by a combination of cash from operations and financing activities[99] Compliance and Internal Controls - The company has unabated and/or uncorrected violations listed on the Applicator Violator List, which may affect the issuance of new permits[79] - Management concluded that the company's disclosure controls and procedures were not effective as of September 30, 2024, due to insufficient staffing and lack of timely reconciliations[103] - There were no changes in the company's internal control over financial reporting during the period ended September 30, 2024, that materially affected the controls[104] Company Structure and Employment - The company employs approximately 26 direct employees and utilizes contract labor for various operations[92] - The company has established subsidiaries focused on the recovery and sale of metals and monetization of critical and rare earth element deposits[64] - The company does not have any "proven" or "probable" reserves and is classified as being in the exploration stage[64] Industry Context - The coal industry is intensely competitive, with principal competitors including Corsa Coal Corporation and Arch Resources, among others[85] - The allocated cost of the property at McCoy Elkhorn Coal is $95,210[70] - The allocated cost of the property at Knott County Coal is $286,046[74] - The allocated cost for the property at Deane Mining is $1,569,641[76] - The allocated cost for the property at Wyoming County Coal is $22,326,101, with $22,091,688 paid in shares of Class A Common stock[78] - Interest expense increased by $253,039 for the three months ended September 30, 2024, compared to the same period in 2023[95] - Earnings from equity method investees decreased by $72,881 for the three months ended September 30, 2024, compared to the same period in 2023[95] - General and administrative expenses rose by $2,216,846 for the three months ended September 30, 2024, compared to the same period in 2023[95] - The company does not have any credit lines currently available to fund liquidity requirements, indicating uncertainty regarding future financial strategies[96] - The company had no off-balance sheet arrangements that required disclosure, and all transactions are recognized in accordance with generally accepted accounting principles[100]

Financial Data and Key Metrics Changes - The company reported approximately $150,000 in revenue from ReElement in the quarter, indicating a relatively small scale of operations at the Noblesville facility [50] - The company is focused on minimizing shareholder dilution while pursuing growth through alternative capital strategies, such as bond offerings [29] Business Line Data and Key Metrics Changes - ReElement Technologies is producing lithium carbonate and rare earth oxides daily, with ongoing efforts to qualify products with customers [49] - American Infrastructure is transitioning to a royalty-based model, focusing on high-value, high-margin products [34] - American Metals is developing innovative strategies for pre-processing rare earth and critical minerals while continuing its steel recycling operations [35] Market Data and Key Metrics Changes - The company is positioned to disrupt the rare earth and critical minerals market, which is currently dominated by China, by offering competitive pricing and environmentally friendly processing methods [25][31] - The demand for domestic production of rare earth elements and critical minerals is expected to grow, particularly in light of national security concerns [75] Company Strategy and Development Direction - The company aims to establish a critical rare earth element supply chain to support national security and defense applications [30] - The focus is on innovation and technology to create a sustainable domestic supply chain for critical minerals, avoiding reliance on traditional methods that are environmentally harmful [22][31] - The company plans to spin off ReElement Technologies as a standalone entity, with a target retention of 19% ownership by American Resources [85] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the trajectory of the business and the potential for significant revenue growth in 2025 as production scales up [51][70] - The company acknowledges the challenges posed by market volatility and competition but believes its innovative approach will lead to substantial value creation [62][75] Other Important Information - The company is actively pursuing partnerships and collaborations to enhance its market position and expand its customer base [48][61] - The company is also exploring opportunities in Africa, leveraging its technology to create local jobs and compete with Chinese investments [84] Q&A Session Summary Question: Update on ReElement sales and revenue ramp-up - Management is building a diversified customer base and expects significant revenue growth in 2025 as production scales up [48][51] Question: Capacity concerns at Noblesville and Marion - Current bottlenecks are in pre-processing, and management is confident that moving this to Marion will enable increased throughput [52][58] Question: Timeline for spinoffs and public listings - The record date for ReElement's spin-off is December 31, with plans for it to be public from day one [66] Question: Future profitability of American Resources - Management believes that once mining operations commence, the company will become cash flow positive [97] Question: Market conditions and pricing strategies - The company is focused on producing affordable products while maintaining environmentally friendly practices, which are expected to attract more business [73][75]