Colorado Mining Companies LLP, Partner Update
December 10, 2021
This report will be provided to you monthly by the 10th of each month to keep you informed of Procurement Gap Exceptions. Of course, initially as we get electrical infrastructure ordered and put in place, we anticipate Procurement Gap Exceptions to Distributions until about April or May. As a rule though when we start mining and the 25% Reinvestment of Monthly Revenues kicks in, this will create a permanent Procurement Gap Exception; so, this monthly Partner Update will become a permanent communication device for our Partners and will be posted to the private Partner login section of our website (not yet live).
An exercise in flexibility
The immersion tank supplier with the 480v “kits” was not completely honest with us. As we began working with their electrical supplier, the parts list included a 480v to 415v secondary transformer. I had very specific conversations with them about their 480v system, only to learn that they require 415v just like Submer. We have since discussed this discrepancy and talked about cost and complexity issues with their product. They acknowledged complexity issues and have already been planning to reduce the complexity of their “kits”. I thanked them for their time (sarcasm) and closed our relationship. The small upside of this is that their electrical supplier gave us a referral to a miner supplier (that was not already on my list of suppliers).
Yes, I fully realize that the urgency to accept Capitol Contributions was based on a soon to expire quote from the “kit” immersion tank supplier. I apologize, but I was acting on the best information I had at the time. This certainly does not mean that your funds are not needed though for immediate needs.
Immersion Tanks
We will be proceeding with the Submer containers as originally planned.
Months ago the Managing Partners put $150k down on our first Submer container full of immersion tanks with dry coolers on top. We have a quote on hand for our second Submer container and plan on placing the order before year end (there is a price increase on 1 Jan 2022).
The plan for the second container is to fill it only initially about 60% full of miners so that our 25% reinvest funds can be used to fill the remaining miner immersion tank slots so we all can benefit from exponential distributions!
Electricity
Our Electrical Engineer and Electrician had meetings over the last couple of weeks with both Submer and an electrical supplier to establish final specifications for secondary transformers, electrical panels, and breakers. The electrical supplier is working to find parts that meet our needs; covid supply chain issues are not helping and are delaying progress in this area. When acceptable parts are located, those specifications will be added to the CAD drawing file, and the CAD file will be submitted to CORE (the electric company).
Two 480v to 415v 1500kVA secondary transformers will be ordered (waiting on electrical supplier quote). Each Submer container requires a 480v to 415v 1500kVA secondary transformer and associated breaker panels and cut offs.
As required by the electric company, we have also hired a surveyor to perform an easement survey. The survey process consists of three phases that will be completed over the next month.
Miners
We will begin shopping for miners in January. I can’t imagine trying to get miners shipped during the Holiday rush of gifts; much less expect overworked delivery folks/freight folks to treat packages/pallets well.
Partners
As Partners come onboard, we are obligated to send all the Partners a copy of the updated Exhibit A which details all the Partners and their Capital Contributions. There are three additional Partners coming on board within the next 10 days; I will send out the updated Exhibit A then.
We are excited to announce the addition of our first Holding Company as a Partner. We gave the Partner presentation to them a few weeks back. This is a great validation of our business model and our Partnership Agreement.
Your referrals to potential Partners are very much welcomed. We have recently brought on 3rd generation referrals as Partners!
Website
As time allows, we have been working on our website and anticipate going live in the next few weeks.
The website will serve as a communications medium for our Partners and a marketing tool to attract additional Partners.
Initially it will not be all that pretty, but as we stand up our equipment and begin mining, we will be able to update it with better pictures (of our own equipment/operations).
Accounting
We have completed initial QuickBooks training with our Accountants team and have begun making accounting entries. As we reach year end additional work will be completed with our accountant in preparation for sending out the Partners statements early in January.
Looking Forward
As we anticipate the installation of the electric company transformer (three million watts!) and the installation of our secondary transformers, the Submer containers, and our miners, it is already time to begin planning for our next phase of expansion. What a great problem, so much to do, so little time.
We continue to talk with potential Partners by showing them our Partner Presentation. As we bring on more Partners, we all benefit from economies of scale (remember freshman economics from college?). Bulk purchases of miners from suppliers mean we get better pricing. We also saved $15k on our second container from Submer because we are repeat customers.
Happy Holidays,
Mark
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