ClearSign Technologies Corporation (CLIR) Q1 2025 Earnings Report, Transcript and Summary

Good afternoon and welcome to the ClearSign Technologies First Quarter 2025 Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference server to Matthew Selinger of Firm IR Group. Please go ahead.

Good afternoon and thank you, operator. Welcome everyone to the ClearSign Technologies Corporation first quarter 2025 results conference call. During this conference call, the company will make forward-looking statements. Any statement that is not a statement of historical fact is a forward-looking statement. This includes remarks by the company's projections, expectations, plans, beliefs, and prospects. These statements are based on judgments and analysis as of the date of this conference call and are subject to numerous important risks and uncertainties that can cause actual results to differ materially from those described in the forward-looking statements. The risks and uncertainties associated with the forward-looking statements made in this conference call include but are not limited to whether field testing and sales of ClearSign’s products will be successfully completed, whether ClearSign will be successful in expanding the market for its products, and other risks that are described in ClearSign's filings with the SEC, including those discussed under the Risk Factors section of the Annual Report on Form 10-K, the period ended December 31, 2024. Except as required by law, ClearSign assumes no responsibility to update these forward-looking statements to reflect future events or actual outcomes and is not intended to do so. So on the call with me today are Jim Deller, ClearSign's Chief Executive Officer; and Brent Hinds, ClearSign's Chief Financial Officer. To this point in the call, I would like to turn the call over to Brent Hinds. So with that, Brent, please go ahead.

Thank you, Matthew, and thank you to everyone joining us here today. Before I begin, I'd like to note that our financial results on Form 10-Q was filed with the SEC on May 15th. And with that, I'd like to give an overview of the financials for the first quarter of 2025. For the first quarter of 2025, the company recognized approximately $400,000 in revenues compared to $1.1 million for the same comparable period in 2024. The year-over-year decrease in revenues was driven in large part by a decrease in process burner shipments. Now recall, last year we shipped multiple process burners to a California refinery, whereas this year's quarterly revenue consisted predominantly of spare parts orders. Now I'd like to look at the full income statement. Our net loss increased by approximately $1 million compared to the same quarter in 2024. This year-over-year increase was predominantly due to a decrease in our sales volume as compared to the same period last year and $581,000 in legal fees for two separate unrelated activities. One activity incurred $131,000 in legal fees that pertained to work performed in connection with a regulatory inquiry by the SEC into the trading of our securities back in the year 2020. For the second activity, we incurred legal cost of $450,000 during the first quarter of 2025 related to work performed for a board special committee in response to submissions of several stockholders for director nominations. Now for some background. During the first quarter of 2025, the company's Board of Directors formed a special committee of all its independent directors for the purpose of responding to, managing, and otherwise addressing attempts by several stockholders to submit director nomination notices in connection with the company's 2025 annual meeting of stockholders. We believe, based on recent information provided by the special committee, that this activity is near completion. Now I'd like to shift the focus to cash. Our net cash used in operations was relatively flat compared to the same period in 2024. For the first quarter of 2025, we used approximately $1.1 million in operating activities compared to approximately $1 million for the first quarter of 2024. We ended the first quarter of 2025 with approximately $12.8 million in cash and cash equivalents. Our outstanding share count as of March 31, 2025, was approximately [$52.4] (ph) million. From an overall financial perspective, we believe our current working capital positions us well to scale our business and we believe it also gives our customers and suppliers confidence to do business with us. And with that, I'd like to turn the call over to our CEO, Jim Deller. Jim?

Thank you, Brent, for the financial overview. As always, I'd like to thank everyone for joining us on the call today and your interest in ClearSign. For the call today, Matthew will lead a question and answer session where we'll go through different business units, much like our previous calls. We will end with an outlook for the rest of 2025 and then open up the call for Q&A from our investors. Many of you have seen this, but you can send in questions ahead of time to our investor relations at mselinger@firmirgroup.com. So Matthew, I will hand over to you.

Alright Jim, thanks. So we did have a call about a month ago, and I'd like to carry some of the themes we talked about then, diversification of both product lines and channel. Now I have heard from some investors of a perception that we've been a bit quiet, especially in this interim. Can you give some color of what's been going on?

I certainly realize we have this issue of the one that's really slated to a place of order since the last call, but the period's actually been very busy for as we have got a lot done. I think some of the major activities are probably worth highlighting. The large 26 process burner order that's going down to the Texas Gulf Coast chemical company has been in testing. There's been a lot of engineering and a lot of interaction with the logo, as we progress that project. There's been a lot of activities related to sales growth and customer visits, both individual sales trips and commerce attendance, that I think we should touch on later. And the [Ministry of Ministry] (ph) has been very busy for us. We've had continuous work there that I'm actually very excited about. So, I understand not many places always came in in this quarter, but we actually have made a lot of progress and got a lot done.

Okay, great. I think we'll dive in and unpack some of those. One of the items you mentioned, Jim, was the recent press release about a Flare Order. Could you give a little more, and this is again diversifying some of the product lines, right, could you give a little more color on this order and we'll dive into this?

Certainly. In the last call we started talking more about this has been a product line that, historically we've not talked about that, it's not been a dominant focus of ours. But in the recent months, we have seen a lot more traction. It seems to be a new need driven by regulations. We did receive an order in the last few weeks. What's exciting is this is actually a repeat order from the same customer. And this customer has actually ordered players from ClearSign back in the past, even prior to my joining the company. Then just a little bit of background on what we're doing. So these flares are a cylindrical vessel. It's a large cylindrical vessel, probably 30 feet high. And the burner element is inside that vessel. The burner element is designed to have very low NOx emissions and burn the fuel cleanly. That's our specialty. That's why we're putting burners in there. The existing burners were not meeting the permit requirements and the customers come to ClearSign to replace that burner. So the vessels are in place. The first order we got, we did the engineering, we've since got the order to build that flare burner. The order we've just recently released, is a second engineering project to design a burner. We have to engineer these because they have to retrofit into the existing products.

And so again, so we're seeing a resurgence kind of in this product line.

Yes.

And let's talk some numbers here. You mentioned obviously that this was the third total project for this customer. This most recent order is the second in short order. We did concentrate talking about, excuse me, this is the third order for them most recently. We talked about the second order on the last call. And on that, you did talk a bit about the total order size. Could you go to give us a quantification on that?

Certainly. So These orders are coming in -- in phases, but for the, right, [Peterson] (ph) will talk about the overall project, the supply of the engineering and the burner product to the site is going to be all part $250,000 to $300,000. In example, the last one, they've added some other hardware to the order that's increased the size of that scope. But compared to a typical burner order that we've given guidance is typically around $100,000, these just the burns for flares being the $250,000 to $300,000 range. Now just to build on that and the theme of the previous call, we've talked about the systems projects or our ability to sell not just in this case the flare burner, but the entire flare product as a system. We do have some of those quoted. When we can expand that scope and talk to the size, those will be in the range of [$750,000] (ph) to $1.25 million, typically, but the orders we have in-house now, just for clarity for everyone, that equipment supplier will be in the $250,000 to $300,000.

Those are great size orders, got it. And then I do want to make a clarification regarding some of the terminology. And I'm not sure if investors pick this up, but we did have some, a little bit of changing terminology in the last press release. I know you may want to address this just so we don't confuse investors going forward.

Thank you, Matthew. Yes, I should did want to bring this up. So just to confuse, and Matthew, please help me out if this gets too complicated. I'll try and keep this really simple. The wording of the last order we got was that this unit is actually an incinerator. I mentioned what we're supplying is the burner into a vertical vessel and the purpose of that piece of equipment is the disposal of waste gas. Just the way that both the -- what's technically called an enclosed ground flare and an incinerator are defined, this particular product falls under both names. The reason I wanted to bring this up is looking at permits or potential future journal articles or reports from the site, you will see that sometimes these things are called incinerators, sometimes they're called flares, I don't want to be confusing and keep flipping back and forth in the press releases, but just for clarity for anyone looking, they are actually the same thing.

Okay, fantastic. Let's move into the process burners then, Jim. Can you give an update on the progress of some of the orders we've announced? You did touch on this in your kind of earlier high level, but maybe get into diving into the actual orders on the process burner side, traditional process burners.

Yes, certainly. And this is probably the most important area going on for ClearSign at this time. We have two very large process burner orders that are in different stages of production. The first we've been talking about for some time, there's 20 burners waiting on the job site for a Los Angeles refinery. Those are scheduled to be installed in the third quarter of this year. They will be the first major installation for ClearSign process burners. We'll be very excited to get those in. At the same time we're also working on the 26 burner order for a Gulf Coast Chemicals company. Those burners are going to four different heaters. They're in the final engineering and testing phase, but they are also due to be fabricated, shipped and hopefully installed later on this year. But these two installations will put our products into household global name companies and be very well recognized within the industry. So in terms of references and establishing ClearSign showing what we can do, these will be very important for us.

Okay. And then shifting to the expanded sales channel for process burners, I'm going to ask you what's going on with Zeeco. I know we announced the sales and marketing agreement in December, and I know the co-branding was finally launched in March. Any sort of update you can tell us you know going on with the relationship with Zeeco?

I can I mean it's quite brief at this point but I'm very pleased their marketing team and our marketing team are working together really well to complete the [packaging] (ph) information that the Zeeco sales team need? I believe they are just about done. So certainly one of my markers for upcoming months is to register the first inquiries that come in from a Zeeco sales lead. But the other cooperation is going well. You know, we're also testing the burners at Zeeco for the 26 burner order. And just the interaction and the assistance, and we've actually hosted our client as part of that testing. They've been into witness. The accommodation of our client on the Zeeco side has just been phenomenal. It's truly been a very supportive and productive relationship.

Okay, and then how about giving a little bit of color on the pipeline? What are you seeing in the sales pipeline in general? Maybe give us some visibility into that.

Yeah, maybe I can start, we track our sales in software Salesforce.com, but we can pull data out of that to keep track of how things are going. And a big indicator for me looking for our future business is the opportunity pipeline and the inquiries we're getting in and the trends that are showing. So maybe just to share some very high-level data, the number of quotations that we've been able to provide so far this year compared to the same time period last year has doubled, which is very encouraging. What's more encouraging is when I look at the total value of those proposals, the value of the proposals put out year-to-date this year are just under 5 times the value of the proposals put out this period last year. And I don't want to give a false impression. Those are not orders. There's no direct math or promises. But for me, looking forward to our business, the first thing I'm looking for is, is the interest there. Are we getting inquiries? Are we getting, does our equipment meet those inquiries to the place that we're actually putting out price proposals? And this is a very strong indicator. I'm very optimistic with these numbers and the data I'm seeing.

And for clarity, the numbers you, the kind of quantification you were giving was total proposals, is that correct for the company?

Yes.

Okay, so that may include then the M series focused on the midstream, which we talked about quite a bit in the last call. Okay, so with that, why don't we -- we did focus in on a lot of last call on the M series, which is focused on, which again is a new product line focused on the midstream. Can you give me some color, what's going on, what are you seeing there?

That just continues to be a good, a great story for us. The interest is just growing. In the last few weeks, in the midstream in general, this is actually a free and more burning. We've worked with Exotherm, one of our customers, and started that burner up in their facility as part of a check before that heater goes out to their customers' job sites. That went well, we look forward to getting that burner out. We have had repeat inquiries from established customers, [Tulsa] (ph), the mainstream and Devco in particular, but we've been able to recently provide quotes to them for not only new burners but also retrofit burners where there's equipment out in the field with new emissions requirements and now looking at M1 burners for replacement of the existing burners out. Through them we're also getting traction with some of the major companies in the midstream business and actually getting some really good interest from them, which is extremely exciting because they are just the boiling of the equipment to help them.

Okay. And as a reminder, the go-to-market strategy here is leveraging channel partners which you mentioned right Devco, Tulsa midstream, Exotherm -- and are there others out there that we could be utilizing and leveraging?

Yes definitely. I've been a very tangible part of our sales activities right now and the planning and how do you plan for sales growth is to take our M1 technology and go and meet the other companies that produce heaters because the more of those we introduce our technology to and get to use our burners, they essentially become an additional part of our sales channel and expand our reach and exposure. So very much that's a key part of our sales growth plans.

Okay. And speaking of kind of sales and growth plans and initiatives and activities, what about conferences? Are you leveraging conferences? And I do believe there have been some very recently. Is that correct?

You know, in this, what we've been doing since the last call, a couple of the key activities, 1 were just having our engineers down making a tour, visiting customers one-on-one and local meetings. But there's been some key conferences in that period also. One of them, we're seeing a significant interest up in Canada. There are some key conferences up there that we'd be able to attend and use to start making a network and connections up in Canada. Probably the most important for us was the American Petroleum Institute meeting. This is a bi-annual meeting. The main function is to update and refresh the refining and equipment standards, which actually is the name of this conference. But because of that, nearly all of the lead engineers from the major refineries, the major heater manufacturers, and the consulting companies, they are all there. So it's a very good conference for us to attend frequently. One of the key activities there is, it's, you know, obviously the sessions are important, we're doing the technical work, but it's the dinners and the lunches and the times that we can interact with our customers. Previously, we've been able to interact with the lead engineers just because we've got personal relationships with them. This last call, or this last visit, I'm sorry, we were able to get one-on-one dinners with the lead engineers from the major refineries on multiple occasions, major heat manufacturers. So we're seeing that they are talking to us now about us being solutions to their projects. They're spending a lot more time with us, showing genuine interest in ClearSign of what we're doing. And to go back talking about the sales numbers, I think that that is the same theme that's being reflected in the sales numbers because a big part of that increase in value is a lot of process burner opportunities where we are being included at the early stages as our clients now look for solutions to their [not problems] (ph) as they retrofit their refinery heaters to comply with new standards that they either have or they foresee in the future.

So ClearSign is really a known entity now.

It's getting -- it's really getting a lot more established and being taken seriously. I mean this is -- what we've been trying to get to for years. It's really starting to show up in the numbers.

Okay. I'll shoot to an additional product line, you know, boiler burners. You know, maybe just give it, a high level. What is going on with the boiler burner product line now?

Yeah, I mean the market has generally been quiet in California. We've recently seen a significant increase in inquiries for the water tube boilers that we've got a burden of, in fact, the M1 that we're modifying for that. I'll have more news. We actually have California Boiler coming into our office. We're going to be meeting with them on Thursday to talk about sales planning and how to address this market as part of that. So I don't have a lot of more news right now. I think on the next call we can give an update.

Okay. Fantastic. And then how about the ClearSign eye? I know in the last call we had some significant developments to report, which is exciting. We're seeing this product line kind of start to get its early growth, right?

Yeah, it's hard to say early, but the product line has been around for a long time. But we have recently got some very significant traction. We have the four sensors going down to a prominent Gulf Coast refinery for installation demonstration there. But those are in production. They're not down on the site yet, but I think in the next couple of months they're due to be sent down there and started up. That refiner has also requested a quotation for census for a second heater. We think they'll have to get these demonstration ones up and running first, but we expect that to follow on. Also, we have now got the opportunity with building sensors to fit onto our first ClearSign burners down on another Los Angeles refinery and have a second heater with ClearSign burners where we're actually providing a quotation for the sensors to be installed there. So it's starting to happen. I think for the timing, it takes about 12 weeks to manufacture these sensors, more time to install them. But compared to a burner project, this product is going to turn quicker. It's a standard product going to be off the shelf. It's really a disruptive technology that replaces a device called a flame rod that is hated in the industry for a repeat of mechanical problems. So I think there's a really big need for it. It is a flame detection device, so clients are going to have to see it to get comfortable using it. But with that turnaround, to get these installed, to get a few months of runtime, we're seeing things picking up. I think realistically, we're probably in the 6 months to 9 months I'm really expecting to start season traction as we get these first installations out into the field and getting them running and then the news to spread around the industry.

Alright so there'll be a few commercial installations coming up fairly soon and these are sold into then the same customers with the same expertise and the same subject matter experts that correct as other products?

Yeah that's really nice for us it's the same people but the subject matter experts in their primary are fired equipment experts so that covers the burners, the sensing technology and other aspects of heaters. So these are the same people already talking to. I think what's significantly different is the sensor is not related to any NOx requirements or permitting so the applications to these sensors are worldwide every heater rather than just the regions that are under new or expectedly new [noxious strains] (ph).

So the market exceeds that of our process burner addressable market?

Vastly, yes. It's every process burner that has a flame sensor on it. It's a huge number.

That's exciting. So, it's got a high volume off the shelf, lower sales price as we said, right? But applicable to our existing and growing customer base.

Yeah. Off the shelf, but no customer engineered. This will be a volume style product.

Great, that's exciting. So, to what investors should they be looking for some key milestones over the next few months and rest of the year?

[Might be] (ph) just thinking through this. As I mentioned, the startups of those two big process burning projects are going to be key for us. Those are very big deals. We have some other projects in progress actually with Kern Energy, Kern's a repeat customer of ours. We're expecting to move forward with some other heater projects with them, which will be just for that repeat business will be exciting. But the fact of the point, the 2 big, the LA refinery startup and the US Gulf Coast, I think, are going to be very significant. I think for the growth of the industry, I am and I continue to be really excited about the midstream, especially with the M1 product that we have, getting the traction and the growth and expanding the sales channel and the potential for repeat orders and getting into some of the major players on the end user term in that part of the industry. I think just getting the sensors up and running will be a great development for us. And then really this engagement with Zeeco and getting their Salesforce engaged started to get inquiries in from Zeeco. I mean -- they have we presented our technology to 50 of their sales team that's 50 of their US based sales team about half of those are embedded in the customer refineries. That's where they have an office. So the exposure they have and the opportunities that they will come across are going to vastly outnumber what we see. And to them to have the right materials, which is what we're creating, what's taking the time right now, to be able to have a conversation with their customers if they hear they're considering putting in an SCR to use their NOx solutions, to be able to walk into that meeting and say, I have a solution for you, is going, I believe is going to be extremely powerful. So looking for those first [inquires] (ph) coming in from the Zeeco sales team to me is going to be a big market.

Great, well it's exciting. I think exciting times and seeing the other product lines and our sales channels start to kick in. I think it's going to, I think a lot of investors have watched it for a while. Like I said, again, excited to be here. I don't have any more questions. So with that, I think we'll open it up to the operator, and then open it up for other people to ask questions. So with that, operator, please open it up for questions.

We will now begin the question-and-answer session. [Operator Instructions] Your first question comes from the line of Sameer Joshi from H.C. Wainwright. Please go ahead.

Good afternoon. Thanks for taking my questions, Jim, Brent. Matthew did a good job covering a lot of the topics that we wanted addressed, but just digging a little bit deeper in some of those. The Zeeco co-branding effort, how are the Zeeco salespeople incentivized to sell or market your product? Is there a commission-based approach or is there some kind of revenue sharing? Just wanted to understand what is their incentive just to market the product?

Thanks, Sameer. That is a, to be honest, that is a subject we have yet to work out. This engagement at this level with Zeeco is quite new and obviously we're working through getting the materials to them and getting them engaged with our sales team. I'll be frank, at this point, there is definitely an incentive system there. I've not had a discussion at this time with Zeeco about a specific or different incentive system or ClearSign project specifically. Obviously these are the Zeeco employees and the Zeeco sales team. So that's a subject that I would address with respect of the Zeeco organization and the understanding we have with them.

Understood, Yeah, I know it's early days and you're still working out how it will work. That's fair. On the ClearSign, I, [four] (ph) deployment that you are planning this quarter, are there any subsequent, I know you talked about some additional orders emanating from this, but at the same location, can you deploy additional sensors? And then because it is a super major, how many other refineries can you also deploy at the same Super Major?

Great question. So, you know, at this point, what we're manufacturing off [four] (ph) demonstration units going down to a Super Major on the Gulf Coast, that refinery has many heaters with many burners. So even on that one site, there will be thousands of potential opportunities. And being a super major, you'd reasonably expect that that company has multiple refineries within the US and then even more globally. And you can rattle-off the household names of the major oil companies that have refineries throughout the US. The centers are applicable through all of those refineries, whether it's, and again, whether it's US-based or other countries around the world.

Understood. And then this last question is sort of like a macro level question stepping back from where you sit and given the tariff environment, supply chain environment, demand as a result of this environment, and also the forthcoming regulatory relaxing, potential relaxing of certain regulations. How does that, like what is management's view of how these things will interplay with your business?

That is a good question. So I've you know -- I've obviously got thoughts and opinions which I will share. I do not have, I don't think anyone really has data at this point. We you know -- we've looked very closely at the materials pricing of our products and there were some initial, I'll say price fluctuations, I think, due to the uncertainty when the tariffs were first announced and nobody knew what was going on. The pricing seems to have settled down back to the pre-tariff levels from what we're seeing right now. So as of today, we're truly seeing minimal impact right now, although there are obviously sensitivities, but just to the uncertainty. And I think that's consistent with right general conversations in the market when we're looking at projects and I find planning projects I think just the uncertainty that it creates is as much of an issue as any pricing changes. Just to finance projects, it's good to have stable pricing, stable financing costs. But with that said, I've not heard of any projects that we are discussing or bidding on or chasing orders for that have actually been affected by any of the news. So the speculation is purely my opinion in terms of what we've seen. We've actually seen, to my knowledge, we've seen nothing that has been tied directly to tariffs with our customers. In terms of the regulations and effects on the EPA, and most of those changes appear to be focused on promotion of hydrogen technology, which obviously is something that we do watch very closely as we work out the promotion of our products. Do we promote the hydrogen burner? Do we focus on other technologies? The main driver of our business is low NOx requirements and the need to meet new permit requirements. That is an age old known pollutant and it's clearly written into the function of the EPA and we've not seen any slowing down or changing of the needs to reduce ground level ozone, which is a precursor, well NOx is a precursor of that. So again, we're watching it very closely. I'm seeing more of an effect on the hydrogen side of a market, which is really just affecting a selection, what type of equipment people are selecting. But in terms of the other projects we're chasing and the need for the technology that we provide, we're really not seeing an effect. And just in the past as well, the NOx emissions I think have been known and accepted, bloomed, and have not been fickle with the change in the political climate.

Understood. Thank you for taking my questions.

Your next question is from the line of Jim Kennedy from Marathon Micro Fund. Please ask your question.

Hi Jim, Congratulations on the good progress.

Thank you, Jim.

Really two questions related to some comments you made about the proposal pipeline and it being up approximately 5 times in dollar volume compared to a year ago. Number 1, and I realize this may cut across product lines, but can you comment on are these competitive situations where there was a request for proposal, it went out to many companies, or were they ones where you are the only provider of what they may be kicking the tires on. That's the first part. And then the second part is really the source of these proposals. Did they come from your internal folks? Did they come from the channel? What's getting these proposals elevated the way they are, at least at this point? Thank you.

Thank you, Jim. So, Yeah, I'll tell this one at a time. The growth in the sales value of the proposals out is a combination of multiple different product lines. A significant portion is from the process burners and inquiries from major refineries who are planning how to control emissions or to make expansions in units and stay underneath an a -- Nox cap. Other parts of that are from the newer systems projects that we're bidding for complete systems, which are obviously of a lot higher value than just providing the burner elements. Now as to the right competitive situation of those bids, we've got a number but I think generally the refining process burner opportunities are in the early stages where the clients are assessing their options to control their emissions. They obviously have options like installing a large expensive SCR on their heaters, which we need to recognize as a competitive offering. There's also some situations where the client may have a large number of heaters and they have the opportunity to change out every single burner with a more standard burner or actually address just much fewer heaters and make much large Nox reductions and install the ClearSign equipment, so in those regards there are competitors however the right the price advantage we have against an SCR and I think the big changes that we're seeing is we've always had that value compared to options like the SCR but the difference now is that we're actually considered a credible alternative and these large refiners are coming to us because they see us as obviously a preferred solution. We are a lot less expensive, we're a lot less disruptive to their refining. The amount of work to install our burners is vastly less than it would be in the [SCS] (ph). I think really this speaks to the acceptance or the growing acceptance of ClearSign burners and recognizing us as a viable provider to these major global companies. On the systems project side, there's a mix. Some we've bid, I believe they may be going into a somewhat competitive situation, depending on the NOx levels the client actually needs. But there are certainly others where we have or we believe that we are in the position of being the only vendor able to meet the specific needs of the customer, which is very exciting.

Gotcha. And in these situations where the customer is looking for, let's call it the lowest possible PPM, you're the only game in town, right? And then to follow up with that, do you think those customers are looking for your level of NOx reduction because of what's coming down the pike regulatorily or they just want to do the right thing?

It varies across projects. We have one very large project that would fall into the, actually in the system side, the client has a cap on their NOx emissions in like tons per year or pounds per year. So there's a certain number of NOx molecules they're allowed to make a year and by enabling them to operate with lower NOx emissions, we're actually enabling them to expand the capacity of their plant. So there is definitely a value to the absolute lowest NOx members they can get and that's what we believe is the financial driver for that project. There are other projects where we can enable a client to modify less of their equipment to meet their overall NOx cap. And to be fair, we have to recognize they're making an economic decision looking at the by the total project cost. Do they modify, for example, two heaters with ClearSign burners or do they modify eight heaters with somebody else's burners and look at the overall cost of those projects. But again, I think we have a competitive offering. And the additional advantage is by going with the ClearSign burners, if the needs change in the future, they've got the option of putting more and more ClearSign burners in, as the regulations continue to reduce.

Gotcha. And then just circling back to my proposal question, with this increased dollar volume that's in-house now, how much of that is Zeeco-related versus not? I mean, are we just, we're basically in the first inning with Zeeco now, and can you say that most of what's in-house at 5 times is not related to Zeeco, bringing in -- in the doors?

That's right. At this point, we do not have inquiries coming in from the Zeeco team as of yet. So this is developed through the ClearSign team, a lot through personal connections, knowing the subject matter experts on the refineries, through conference meetings, ex cetera. So I'm actually very excited as we bring Zeeco on board and ramp up with their sales team, that will be additional to the business that we have today.

Yeah, I mean what an exciting opportunity. Okay, thank you Jim.

Thank you Jim. I appreciate your questions.

There are no further questions at this time, and so I'll be turning the call over to Mr. Matthew Selinger for our email lead questions. Mr. Selinger, please go ahead.

Thank you, operator. I'm going to go ahead and read some questions. Thank you to the investors that sent them in. We've got a healthy number of questions that came in the email ahead of time and even up to this current moment. So starting with the first one, Jim, you did mention in the last call that you could tweak the ultra-low emission burners to make them good but juice up their energy efficiency and be a mass market adoptable burner for those not needing the ultra-low Ferrari model but would do just fine with a very efficient Sedan. Have you made progress on moving to this market and getting any traction with this potentially appealing new option?

We have -- this is one of the growth areas of working on it and you appreciate this is -- it's a sales initiative and also a technology and a sourcing project. Because as you bring the sales price or move your technology into a lower sales price part of the business, the cost is a very big factor of that. We have actually got some quotes out with customers for this lower spec or less Ferrari product. We do have good feedback and what's been interesting is as we pursue this initiative, we're actually uncovering new areas of collaboration and new partners and new opportunities. So it's yes, we are acting on it. We do have quotes out. I'm definitely not saying it's done because what we're learning is there's actually a lot more opportunity here that we believe is potentially very good business for ClearSign and we will continue to work on that and develop the products to [eat] (ph) that market that we believe we have the ability to do well with the engineers and the technology at ClearSign.

Great. Here's another question. How will further ramp up in commercialization of the ClearSign Eye Sensor look like? I know you touched on this earlier.

Good question. So I think, you know, if just take a step back looking at the ClearSign products, we have products like the process burners and the flares where there's engineering quite long lead times. And then we have products like the boiler burners and what we're planning to be the midstream burners that we will be a more standardized platform off-the-shelf model. The sensors take that one step further, and these will be produced in volume of a fixed design, kind of a sold off the shelf product. But the -- I think the question was probably related to the market and sales and my expectations of the growth of that market. We'll have the first sensors installed in the next 2 months to 3 months. Being realistically, the client and the industry want to see them operate and get confidence in their performance and the durability. We have a few more commercial proposals out that I expect to turn into orders once those are done, the community and the market communicates very well. So we don't name clients in press releases often because we can't, but the subject matter experts meet very frequently. I mentioned the API conference we've been to earlier on in this call. Everyone is talking. I do believe that there is a lot of interest in the eye because of what it does and the problems that it solves. I think the news of the performance when they get installed will spread rapidly. So I think to bring a long answer to a conclusion, I think we'll start to see commercial orders picking up in the -- three is probably short, the 3 month to 6 month timeframe and as we get more of these out, I think more people will get confidence in them and I expect it to ramp up from there.

Great. So we'll follow on in the sensor realm, Jim, is the collaboration with Narion still in place? And to what extent is Narion further developing software or other applications?

Thank you. So, a friend I'm not familiar, Narion is a partner we have. They're based in actually our old Seattle office space. The owner and manager of Narion is a ex-Boeing employee, which is how we met with him with some of the earlier applications for the ClearSign Eye technology. The relationship with them is very much in place. We do talk with them frequently. The projects they work on are their business. We talk to our interests, they share some information, but they have a wide range of projects because of the owner's, Mr. Kwon's background. He obviously has aerospace interests, but there are a lot of other very exciting opportunities that he's working on. They do tend to be longer timeframe because he is developing new technologies for some very high tech industries and applications. But it's definitely ongoing and very exciting for us.

Here's another question. Jim, if you call back, there was a lot of talk about SoCal Gas and kind of the DOE grant. What's going on there with kind of the report about efficiency?

Yeah, so there's a lot. We continue to be involved with SoCal Gas. As you said, we first got involved with them following the SBIR grant for the development of our hydrogen burner. That project is still going on. And the SoCal Gas's interest was to initially to provide financial assistance to support the introduction of that high-hydrogen burner technology into their client base in California. As part of the utility company in California, they've been able to put us in touch with some of the large consulting firms there. One was a, I think we were referring to here, was the ICF report where they actually sponsored a third-party monitored testing of the ClearSign burner versus the best alternative burner in the boiler space. That showed about a 4% efficiency increase. By the way, there was a presentation given about an hour ago on that burner product, going through it. I've got very brief notes. We had a very good attendance of a lot of interaction there. But back to the topic, the results in that efficiency increase have provided some great values, statements for our sales team. It gets good traction because with that kind of saving, the installation of new burners will actually pay for itself over a period of time through the less fuel that has to be consumed in the boilers. Just following on from that, we talked a little about the M-series burner, but that has similar benefits and again, through those savings, the client can select the best NOx burner available and realize a significant savings in fuel cost over the years which can actually pay for the burner over time.

So there's a follow-on question which you might already answered then. Are you seeing efficiency becoming more of a factor in terms of the sales process as just emissions or is it equal or in this environment is efficiency leading some of the times now?

It is certainly supporting the sales and gets interest. And I think if you can, right, from a client's perspective or hearing is, realize that a lot of our clients are not the end users, especially in terms of the heater company they're selling to their end users. If the heater company is offering a heater with a premium, a ClearSign product with extra low emissions, with a slight increase in price to the customer, being able to go to that customer and say you can put in this better burner and by the way you will recover your money and get -- and more over time because of these efficiency increases, it makes it a very appealing sales proposal for our customers who are [de facto] (ph) sales channels for us.

Great, I have no more written in questions. Thank you, so with that, I'm going to turn it again back to you Jim, for any closing remarks.

Well thank you Matthew and thank you Operator. So thank you everyone for your interest and taking the time to participate today. We do look forward to updating you regarding our developments and speaking with you on our next call. In the meantime, please keep checking in for developments on our website and especially for more behind the scenes, news and updates, check in with us on LinkedIn. Thank you very much.

The conference is now concluded and thank you for attending today's presentation. You may now disconnect.