Financial Data and Key Metrics Changes - The company closed 2024 with 580 million at the end of Q3, reflecting 29 million in capital expenditures [50][51] - Total capital expenditures for the full year were roughly 32 million [51][52] - The estimated total installed cost for Project Permian has increased to 2 billion, representing an approximately 100% increase from earlier estimates [14][15] Business Line Data and Key Metrics Changes - The completion of the front-end engineering and design (FEED) for Project Permian marked a significant milestone, with no fatal flaws identified in the technology or plant design [5][12] - The company has initiated a post-FEED optimization and value engineering exercise to reduce costs for Project Permian [8][37] - The La Porte demonstration facility has achieved over 140 fired hours of operation during the first phase of the equipment validation program [46] Market Data and Key Metrics Changes - The energy sector is experiencing unprecedented demand for reliable generation capacity, driven by underinvestment in power infrastructure and rapid load growth, particularly from AI and data centers [6][9] - The company anticipates that the market will remain tight through the end of the decade, with significant competition for new baseload generation solutions [96][100] Company Strategy and Development Direction - The company aims to be the lowest cost source of clean, firm power by focusing on cost optimization, modular design, and strategic partnerships [11][58] - Future priorities include completing feasibility studies for multi-unit projects along the Gulf Coast and seeking to raise capital for commercialization [19][21] - The company is exploring opportunities to unlock the embedded value of its technology through licensing and industrial-scale applications [27][48] Management's Comments on Operating Environment and Future Outlook - Management highlighted the challenges posed by inflationary pressures and tight supply chains in the energy sector, impacting project costs and timelines [11][16] - The company remains optimistic about its technology's potential to deliver clean, reliable, and affordable energy, despite current market challenges [57][58] - Management emphasized the importance of securing strategic capital partners to fund future projects and achieve economic commercialization [55][106] Other Important Information - The company is evaluating other creative ways to commercialize its technology, including partnerships for industrial applications [27][48] - The collaboration with Baker Hughes and Woodside Energy aims to develop an industrial-scale Net Power solution for smaller applications [47] Q&A Session Summary Question: Can you break out labor costs and productivity assumptions within the FEED? - Management indicated that they cannot provide a detailed breakdown but noted that market supply-demand imbalances and escalation in material and labor costs contributed to the increase [63][65] Question: How do you see thermal CapEx declining over the next several years? - Management expressed skepticism about CapEx deflation in the near term due to tight supply chains and emphasized the importance of multi-pack deployments for cost reductions [70][71] Question: Can you discuss milestones for modularization? - Management confirmed ongoing efforts to maximize modularization at Project Permian and plans to explore feasibility for future deployments [83] Question: Any updates on discussions with the DOE? - Management noted alignment with the current administration's focus on domestic energy security and the potential benefits of the 45Q tax credit [87][90] Question: How are financial partners approaching funding? - Management indicated that strategic partners are focused on the pathway to deploying Net Power units at scale, aligning with the 2030 to 2035 timeframe [105][106]
netpower(NPWR) - 2024 Q4 - Earnings Call Transcript