ASP Isotopes Site Visit

See Disclaimer at the bottom of the Post

As many of you are aware ASP Isotopes hosted an investor meeting this week. Thanks to the generosity of fellow ASP Isotope shareholders, I was able to go out to visit the site. I would like to take a second to give my utmost thanks to those individuals for giving me the opportunity to go and visit the facilities and I hope I was able to provide meaningful insight for them after my visit.

I will go through the itinerary first then summarize some key highlights at the end. There were 27 investors at the event, I’d guess about 50% of them were retail investors (with about 60% of the total investors being American) and the other 50% were institutional in some capacity. There were individuals from the US/Europe/Australia/South Africa/etc. I would say this trip highlighted something that I did not realize and that’s the fact that there is almost no strong US institutional base. Ocean Wall has done a fantastic job in informing the European market but I think there is a large lack of US institutional presence that highlights the need for better sell side coverage in the States.

It should be noted that Fuzzy Panda sent a neutral unbiased individual to this event as well. The individual is known to be a good person in South African financial circles. I spoke to him on multiple occasions during the trip and he came off as very neutral and he asked some great questions about finances while mainly learning the tech on the fly (he told me he was completely new to the company going into this trip). He was an extremely nice individual and I had great conversations with him. I don’t think he had any direct connection with Fuzzy Panda other than doing him this favor. I am not sure what his final thoughts on the trip were.

I will first breakdown the itinerary of the trip. I will then give my opinion of the trip at the end of the article. The first part of the article will be essentially fact based with not much opinion given (there will be a little bit but not much). This is so that all investors are aware of the actual information that was given to us. I will not apply judgement to the things said in the first part of the article, it is just to give you an idea of what we were told and what we saw. Because of this, the first part of the article will be a little dry.

My fund owns stock in this company and I request that you read the disclaimer at the bottom of the post.

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I didn’t read this over and I didn’t look at my notebook so I am mainly going off of memory (the plane ride has essentially been dark the entire ride and I didn’t want the poor sap next to me to get hit with the bright white LED light). So, if there are any mistakes please just shoot me a message.

I hope you guys get a decent feel for what was presented to us. I think it is safe to say that every investor who came to the facility saw much more than they expected and felt much better leaving on Thursday.

Site Visit Summary/Itinerary

Investor Presentation

The investor presentation was the first thing we did on Tuesday morning. This began as the usual presentation that Paul likes to give (I would suggest checking out emerging growth conference presentations if you’d like to see it yourself). After the first presentation the head scientists began to present what they each did:

• Dr. Xandra Van Heerdan (Dr. X) is a PhD Chemical Engineer who was a professor at a South African University. She runs their R&D department (mainly for Aerodynamic Separation Process designs) and explained to us how they utilize a small test bench to test various isotopes in an extremely scaled down version of the ASP technology. This allows them to try different valves configurations and different carrier gases. Each isotope acts differently and her team ensures that all plants act as efficiently as possible in their design.

• Dr. Hendrik Strydom broke down the Quantum Enrichment process. As many of you know from my last article, Dr. Strydom is one of the top nuclear enrichment physicists in the world. For the most part my break down of the tech in my second article (linked below) is close enough for most individuals to get a grasp of the technology without going into the weeds too far.

  Previous article:

  ASP Isotopes: A Thoughtful but (Very) Long Response

  After the presentation we went to get lunch and I was able to talk to Dr. Strydom for over an hour and I have to say it was amazing to hear the joy he has for the company. He no longer has to worry about the business part of the job and focuses on the science. With the balance sheet and customer interest that ASP Isotopes has, he gets funding that he hasn’t had in over 40 years in the business. This is leading his (and his teams) work of the last 40 years to have a major impact on the world.

  • Updates to the process that I learned was that they are enriching in batches, more specific discussion on beam shaping, and vessel design (again my explanation for the tech in my last article should suffice as an explanation).

  • The theoretical limit for vessels that they can use in one system is 100 meters (unlikely they get close to this limit.

  • Ytterbium plant was between $2mm and $5mm to build.

  • They showed us the data for Uranium being enriched with a 678 enrichment factor.

  • Main difference between Lawrence Livermore (whose vessel was nearly 300 meters) and QLE is a much smaller vessel and QLE is not turning the uranium to a molten material (which contributed to the extreme non-selective build up and vessel damage with Lawrence Livermore).

  • TerraPower not only sent out their own scientists to the facility but they sent Lawrence Livermore scientists to the facility.

  • Emphasized that their main expenditures would the lenses on the vessels.

  • They actually updated their slides to address this discussion:

    

  • The DMRE (essentially the South African Proliferation Agency) is extremely onboard with ASP Isotopes and has been extremely supportive in their dealings with the IAEA.

  • I was able to get a picture with Dr. Strydom since I was starstruck, not everyday you get to meet a world renowned nuclear physicist!

    

• Dr. Gerdus Kemp briefly touched on PetLabs (CEO). I will discuss PetLabs more in depth later.

• Joshua Oosthuizen is an ex mining project manager who worked in the mining industry. He has an MBA and a degree in industrial engineering. He gave a talk on the QLE construction process and management of future plants. He showed the integration of the universities and the role they play in the process (such as Dr. Andrew Forbes focus on designing the beam shaping), as well as the total process of building out the plants.

• Heino Van Wyk (Head of Engineering) showed us the buildout plan for ASP plants and what an Iceland facility would look like as a CAD model. The first Iceland plant will be 3x the size of the Silicon plant and it will most likely enrich Xenon-133 (Xenon is in liters not kgs so I don’t know what that would convert to but it is the liter equivalent of 150 kgs). The Iceland plant should probably begin soonish (my guess is the next month or so, more on that later).

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• Paul confirmed in front of all investors that Oklo is the other MOU.

• It was mentioned during this presentation that the company has the capability to create conversion facilities as well due to their strong nuclear expertise. There was no timeline on this at all.

I believe that was all of the different individuals who presented to us. Paul was also helping answer questions throughout.

Visited Multi-Isotope Facility

So the Multi-Isotope facility is literally just the R&D test bench. It is a single separator where they adjust the nozzles, pressure, carrier gases, etc. with quite a few monitor screens attached. Dr. X was the individual who showed us around the R&D bench. The test bench allows for a small scale and no capex way of testing what would work the most efficiently for enriching isotopes via ASP which translates when building a larger scale plant. This was the size of a small room and had about 7 people in it. We met Dr. Simphiwe Ndlangamandla who works on the various gases. Due to the danger of the chemicals we were not able to check out that room that he worked in.

Visited the Ytterbium-176 facility

The Ytterbium-176 facility was in the same building as the multi-isotope plant I believe. It was a small room and it’s where we met Dr. Strydom again and Leerin Perumal. Leerin is a young laser physicist who worked under Dr. Andrew Forbes (the individual who has pioneered beam shaping). The room had two other individuals inside the room that we didn’t talk to (we didn’t go into the room we just looked through a large glass window into the room, but you could see the whole room). The Ytterbium-176 facility was a small room and it was a clean room (hence why we couldn’t go in + proliferation). The room contained one table that had 2 pump lasers (I don’t know what brand they used but they looked similar to the pump lasers I looked up online here). They had 3 dye lasers (again, I don’t know what brand but I found similar dye lasers here). They had mirrors and lenses everywhere for beam shaping. They had two 30cm-60cm vessels. All lasers were turned off.

It seems that they might have already figured out a way to get two vessels in line so they can enrich multiple vessels (although that was not confirmed for us). We were told that for future QE facilities they have already obtained another building where they will build out future QE modules.

Visited the Carbon-14 Facility

The Carbon-14 facility was much bigger than I expected. It was actually running while we were in there (I believe to enrich carbon-13). The facility was the size of two fairly large rooms. They showed us where separation occurred, where the compressors were, and how they utilize both methane and CO2 for the process. A young engineer named Mea showed us around the facilities. Besides Mea there were 3 or 4 other engineers/technicians in the building.

Visited the Silicon-28 Facility

We visited the Silicon-28 facility which was obviously much larger than the carbon facility (there were 10+ sections of separators and an extremely large balance room). Dr. Inbanathan Govender showed us around the facility. This was the largest facility we saw. It was extremely clean compared to the carbon facility and you can definitely see the difference in funding (and the difference in the balance sheet when each one was built) for Silicon vs Carbon. The Silicon plant seemed a lot more modularly build and I am guessing experienced slightly more economies of scale. Everything seemed a lot more organized compared to the carbon plant. It was extremely tall in the balancing room (like probably 15ft+). They showed us the separation containers, the compressors, and the balancing room. They had numerous redundancies in place to ensure the building was extremely safe (since they are working with Silane (SiH4). The Facility had 5 huge diesel generators in front of the building for backup power generation. By the time we got to the Silicon facility (which was essentially our last tour of the day) all of the engineers and technicians were gone so it was fairly empty.

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We then had a slight discussion about contracting for Silicon-28. The company has two MOUs as I discussed in my last article. One of the companies who signed an MOU (the semiconductor company) also has it within their MOU to receive enriched Germanium. The plant will also produce Germanium it just needs a few tweaks to do so. They currently don’t have all 50 kgs contracted out but it’s not something they are super concerned with. They plan to give away some of their Silicon to academic institutions to ensure that the benefits of Silicon-28 are well researched as well as publicly discussed. They believe the industrial gas company will allow them to breach into various foundries. They also discussed possibly adding a sales force for Silicon (ASPI currently has no sales force).

Key Point: Silicon-28 is plug and play and new chips/transistor configurations are not needed to utilize the benefits of Silicon-28. They were told this by the semiconductor MOU company they are working with (would not confirm who it was).

During this tour I asked Paul what were the exact buildouts that were expected to be built by mid 2026. He said one ASP Plant in Iceland and 4 QE plants in South Africa.

• They expect to build an ASP plant 3x the size of silicon and it will take them roughly a year. This plant will be in parallel with the QE plants being built. They are leaning towards this being a Xenon plant (instead of Zinc), this will hopefully be decided within the next month or so.

• Next QE plant will be for Nickel-64 ($24,000/g), 90% gross margins.

• 2nd QE plant will be Zinc-68 (if they choose to do it via QE). Enriching two isotopes, one in gram quantities and one in kg quantities. Unsure of what he said for margins.

• 3rd QE plant will be Gadolinium-160 (there is no current supply chain for this isotope so I imagine pricing will be quite high). 90% margins seem likely here.

• 4th QE plant will be another Ytterbium plant (maybe Ytterbium-171 or 176).

Machine Shop and Manufacturing Facility

This was just like every machine shop I’ve seen as an Engineer. It had CNC machines and various other machines. The building was quite large and they plant to build their Iceland facilities here.

Taking a picture with the Tractors

After all of our tours for the day we thought it would be fun to take some pictures in front of some familiar tractors.

Day 2: Pelindaba

The first thing we did on the second day was visit Pelindaba. The first thing I noticed is that Pelindaba is a huge area (I think like 6 miles or something) and most of it is underground. The NECSA employees that we spoke to made it clear that ASP Isotopes/QLE will be doing their enrichment and it’s something they are extremely excited about. South Africa is essentially wanting to move their whole nuclear fuel cycle in-house. They also mentioned they are wanting to move LEU enrichment in-house as well (which would be done via ASP Isotopes). The enrichment method that they will choose is unknown for LEU but it is an interesting part of the business. When Russia Uranium was cut off from the West it also cut South Africa off from obtaining nuclear fuel since the LEU was turned into EUP in France. This has stimulated a strong desire to vertically integrate their nuclear industry.

The country also plans to build out its nuclear infrastructure using both SMR’s and conventional reactors. They have will have an allocated plan from the South African government for 15.5 GW worth of power (for perspective, a single TerraPower facility is 350 MW meaning you’d need 44 TerraPower facilities to address this allocation. I used that analogy to show the massive nuclear opportunity directly in South Africa that ASPI will be able to take advantage of. NECSA is highly interested in a chinese SMR that is essentially a smaller version of reactors they have already worked with (and is currently in operation in China). This reactor would take HALEU.

NECSA emphasized that the NNR and NECSA cooperate heavily on timelines and the NNR is expected to operate on predetermined timelines so that NECSA can meet their goals. This seems much more company friendly than how the US operates. I believe this was actually fairly bullish on the timelines for their enrichment.

We then had our sandwiches in the lobby get massacred by a monkey followed by the monkey peeing on them. We never actually saw the enrichment facility as we would need a 5+ month long background check which would be near impossible for obvious reasons.

Visited Pet Labs

The last facility we went to was the PET Labs facility. Visiting PET Labs and listening to Dr. Kemp (should be noted that Dr. Kemp is hilarious) discuss the PET Labs potential on the first day it really connected the dots for me. PET Labs owns 90%-95% of the South African market. They are planning on moving into the US as well as places with burgeoning middle classes (such as Indonesia, Botswana, Philippines, etc.). They believe they can build very strong monopolistic positions in these smaller markets and compete very well in the US market. They are targeting PET scans and SPECT scans as well as cyclotrons for other radiopharmaceutical materials. Essentially PET labs gives ASP Isotopes the ability to completely vertically integrate their radiopharmacy in isotopes that barely anyone on the planet has access to. This gives them extreme price power and ability to keep competitors out of the market.

They also plan on building out a PET scan network in these lower income countries through their current contract with GE Health which gives them a mobile PET scanner which they can install in the hospitals and then PET labs pays back over time. This gives the company incredible operating leverage to scale. They also plan on building out their cyclotron base (acquiring two per year in the US) which would allow them to have near perfect vertical integration with isotopes such as Nickel-64, Xenon-129, Molybedenum-99, etc.

I don’t think there is a realistic way to vertically integrate gb-160 (which needs a reactor to convert it to tb-161) or yb-176 (which needs a reactor to convert it to lu-177). While the the other isotopes just need an extra proton (which can be done via cyclotron), you need a nuclear reactor to add neutrons to certain isotopes to get to the desired isotope. Obviously in South Africa they could possibly partner with NECSA to utilize SAFARI-1 (their research reactor) but this wouldn’t be a very scalable approach outside of South Africa.

PET Labs has fantastic analytical abilities and initial batches of isotopes will most likely go through them (they can see to the trillionths of percent for purity purposes). They also have a side business for their analytical side where they can analyze things such as cannabis (to ensure no pesticides) and other things.

My Key Takeaways and Opinions of the Trip

• All of the plants do indeed exist and their costs line up. Their employee count make sense and the science makes sense.

• After talking to Dr. X for hours it was easy to tell that she is extremely knowledge as are many of the other engineers. Obviously Dr. Strydom was extremely knowledgeable but so were the likes of every single individual that worked there. Every engineer and scientist we talked to was extremely smart and had explanations for why they choose to do things a certain way. There were scientific questions flying from the investor base that were being answered extremely well.

• After seeing the Ytterbium facility/room it’s not remotely hard to understand how they would be able to rapidly scale up a similar uranium plant. We are talking a room that is sub 20 feet long and sub 15 feet wide. It contained 2 pump lasers and 3 dye lasers, mirrors and lenses, and two vessels that sit away from the table. Although the science is complicated the cost to build something of this magnitude seems like it would be extremely fast once you determine the spectroscopy and beam shaping. The costs would be extremely minimal.

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• I believe they have already shown an ability to work with multiple vessels. I think the eventual game plan will be to have three rooms per module. One room will have the lasers and the other two will have the vessel set-up (however many that might be, I think it could be a lot). While running one enrichment batch the other room will be inactive allowing for new feedstock, maintenance, cleaning, and removal of tails/product. This is how they would scale.

• The medical isotope side of the business will be huge. If you do the math on the isotopes I laid out it seems like the run rate by mid 2026 will be nearly $100mm - $150mm in revenue (with no sales costs and extremely high margins). Their cost of operations will be high especially as they need to ramp employees for HALEU enrichment. Doing some research into Ytterbium TAMs it seems like the main reason Lu-177 isn’t used early in the treatment cycle is because there is a limited supply so it is a last resort to help patients live longer who are around stage 4 of treatment. I believe if supply increases considerably that would actually help with boosting the TAM considerably. There are also a ton of studies coming out with Lu-177 that could push the TAM from around 3 kgs today to 8kgs-25kgs annually ($150mm-$500mm). These same limitations are around for things like Ni-64 and Gb-160 (Gb-160 essentially has no supply today but is probably the most promising molecule of the three). This is huge for the company if they can even capture 50% of the TAMs that might come from these isotopes (and isotopes we don’t even know about).

• PET Labs could be a huge part of the business as it integrates into their current Isotope business and Dr. Kemp is fantastic.

• Paul is an absolute work horse. It is actually incredible how much Paul knows about every part of the business and every single person praises his extreme work ethic and drive. I think Paul is an incredible CEO and this trip really solidified it for me. Paul and Robbie make a match made in heaven. Currently the whole company is essentially ran on the business side by Paul/Robbie/Viktor/Eddie and it’s not hard to see why sometimes filings were getting delayed (which hopefully Heather has helped with that burden). They are all extremely hard workers and I think I would expect them to pick up a few more employees to reduce the burden a bit.

• The NECSA partnership is very exciting and you can tell that the NECSA individuals are extremely excited to be partnering with ASP Isotopes. It seems like they still operate like any government agency (a little slow moving) but I think they have a very good plan with few regulatory hurdles compared to what the company would have to go through in other countries. NECSA did not seem to have much of a worry about ASPI not being able to supply the needed technology and capabilities for enrichment.

• Silicon is still quite unpredictable but getting confirmation that they can plug and play with Silicon-28 is essential and huge. This means that friction costs are significantly reduced in accommodating for the highly enriched material. The biggest thing now will be to find every use case and benefit by exploring opportunities with semiconductor companies and academic institutions. The goal is to get the extra cost of the material to be below the total savings cost from power consumption and performance enhancements. This means that the better heat conductivity gains the better pricing they will have. I believe it will have to be extremely cheap to be able to produce enough gains for it to be worth it.

Conclusion

The team was extremely excited to have revenue on the horizon (probably because most employees own stock in the company or they’re about it). It was a great visit where I was able to meet many great individuals and investors. I think ASPI is a fantastic company ran by fantastic people. I know Eddie and Viktor were saying they wanted to do this a few times a year and I highly suggest you go and visit the facilities when they open it up. You might think this is just a HALEU enrichment company but there is so much more to this business and they are rapidly scaling to meeting the expectations of their many potential customers. I think revenue is just around the corner and although the tech might be tricky, everyone understand the language of revenue and cash flow.

Disclaimer: The author of this idea and his Fund have a position in securities discussed at the time of posting and may trade in and out of this position without informing the reader.

Opinions expressed herein by the author are not an investment recommendation and are not meant to be relied upon in investment decisions. The author is not acting in an investment adviser capacity. This is not an investment research report. The author's opinions expressed herein address only select aspects of potential investment in securities of the companies mentioned and cannot be a substitute for comprehensive investment analysis. Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The author recommends that potential and existing investors conduct thorough investment research of their own, including detailed review of the companies' SEC and CSA filings, and consult a qualified investment adviser. The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author's best judgment as of the date of publication and are subject to change without notice. The author and funds the author advises may buy or sell shares without any further notice.

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