BQE Water Reports Q1 2020 Results

VANCOUVER, BC – BQE Water Inc. (TSX-V: BQE), a leader in the treatment and management of mine impacted waters, is pleased to release its interim consolidated financial results for the three months ended March 31, 2020.


  • Achieved positive first quarter Adjusted EBITDA for the first time in the Company’s history, at $91,000 compared to negative $80,000 in Q1 2019;
  • Proportional Revenues of $2.4 million compared to $2.1 million in Q1 2019;
  • Technical services revenues increased over 180%, from $670,000 in Q1 2019 to $1.9 million;
  • Net loss of $18,000 compared to a net loss of $327,000 in Q1 2019;
  • Working capital increased by 23% over the three-month period, from $1.8 million at the end of 2019 to $2.3 million at the end of Q1 2020; and
  • Proportional Cash, which includes our share held in joint ventures, as of March 31, 2020 was $2.9 million compared to $2.5 million at March 31, 2019.


Our operational services consist of the operation of water treatment plants, which generate recurring revenues for the Company from two main sources: sales of recovered metals and water treatment fees.

Revenues from Sales of Recovered Metals
The Company operates four water treatment plants that generate revenues from the sale of recovered metals, three plants under the JCC-BQE Joint Venture (“JCC-BQE”) and one plant under the MWT-BQE Joint Venture (“MWT-BQE”).

JCC-BQE Joint Venture
Our 50/50 joint venture with partner Jiangxi Copper Company (“JCC”) operates water treatment plants at Dexing Mine and at Yinshan Mine in Jiangxi province of China. The volume of water treated and pounds of copper recovered by the plants fluctuate seasonally depending on precipitation levels in the region. The operating results for Q1 2020 are as follows:

(in ’000s) 3 months ended Mar. 31
  2020 2019
Water treated (cubic metres) 2,709 5,739
Copper recovered (pounds) 191 782

During Q1 2020, all three plants met or exceeded mechanical availability and process performance. However, the volume of water treated and the mass of copper recovered decreased by 53% and 76% respectively over the same period in 2019, resulting in a 12-year historic low in production. Dexing Mine experienced an unusually low volume of precipitation during Q4 2019 to Q1 2020, with approximately half of the total rainfall compared to the same period of the prior year. Lower rainfall not only limited the water flowing into the treatment plants, but also affected copper leaching from waste rock, which lowers the copper concentration in the plant feed. Changes in water volume and feed grade are largely the result of environmental conditions beyond the control of the joint venture and will fluctuate from period to period.

MWT-BQE Joint Venture
Our 20% share of MWT-BQE is with our 80% partner Beijing MWT Water Treatment Project Limited Company (“MWT”) and together we operate a water treatment plant at a smelter in Shandong province. MWT-BQE generates the majority of its revenues from the sale of zinc recovered from smelter wastewater, along with small traces of copper found in the stream. The operating results for Q1 2020 are as follows:

(in ’000s) 3 months ended Mar. 31
  2020 2019
Zinc recovered (pounds) 183 524
Copper recovered (pounds) 28 53

The decrease in the mass of zinc and copper recovered is due to two factors: (i) there was a temporary suspension of plant operations due to COVID-19; and (ii) changes in the smelter feed composition and production schedule deviated significantly from historic averages, which prevented the water treatment plant from reaching its design capacity. These changes are believed to be temporary, with the smelter expected to resume regular production in the second half of 2020.

Revenues from Water Treatment Fees
The Company is contracted to operate and provide technical support for water treatment plants that generate recurring revenues in the form of water treatment and operations support fees. They include four plants operated by BQE Water for Glencore at Raglan Mine and one plant operated by the MWT-BQE joint venture but supported and supervised by BQE Water in China. Operating fees from the Glencore operations are primarily based on the volume of water treated and discharged in accordance with strict regulatory requirements. The MWT-BQE plant generates fixed operations support fees for the achievement of operational targets that rely on the Company’s technical expertise.

During Q1, the plants at Raglan Mine are shutdown as water stored in the outdoor reservoirs is frozen. Consequently, no revenue is generated in Q1 from the Raglan Mine plants. The MWT-BQE plant in Shandong generates an operation support fee paid to the Company by MWT-BQE. This fee is not linked to the volume of water treated but to the achievement of operational targets which rely on the Company’s expertise delivered through ongoing operations services. The volume of water treated for Q1 2020 are as follows:

(in ’000s of cubic metres) 3 months ended Mar. 31
2020 2019
Glencore water treatment plants
MWT-BQE water treatment plant 153 151


BQE Water’s technical expertise and IP are applicable globally across broad areas of water management. The highlights of technical services provided to clients and technical innovation projects during Q1 2020 are summarized below. 

Commercial Deployment of Selen-IX™ Technology

  • Preparation for commissioning of the Selen-IX™ plant at Kemess Mine in Northern BC.
  • Engineering design issued for construction of a Selen-IX™ plant for ash pond clean-up in the Eastern US.
  • Engineering design issued for construction of a Selen-IX™ plant for a mine in the US.

Cyanide Management/Recovery for Precious Metals Extraction Projects using SART

  • Commissioning of the SART plant at the Parral operation in Mexico.
  • Engineering design for the construction of two new SART plants that will be integrated into the respective gold metallurgical processing facilities for Shandong Zhongkuang Group and Zhaojin Group in China.
  • Engineering design for the feasibility study assessment of tailings re-processing using carbon-in-pulp at an existing mine in Mexico.
  • Preliminary technical assessment of integrating SART into an existing gold heap leach operation in Mexico.

Water Consulting Services – Management, Treatability, Permitting Assistance, Toxicity Mitigation

  • Preparation of a water management plan for a copper mine in Ecuador.
  • Engineering design of water treatment to remove sulphate from tailings supernatant in BC.
  • Treatability study for simultaneous sulphate and selenium removal from mine impacted water in the US.
  • Pre-feasibility engineering design of water treatment integrated into a gold metallurgical processing facility in Mexico.

Improvements and Optimizations of Existing Water Treatment Plants

  • On-site water treatment plant management services at a mine in BC.
  • Design improvements and commissioning of ammonia and nitrite oxidation system using break point chlorination at a mine in BC.


We are very pleased with our Q1 2020 financial results, having achieved positive first quarter Adjusted EBITDA for the first time in the Company’s history. Q1 is typically our weakest quarter in terms of financial performance primarily due to the impact of climatic conditions on our recurring revenues from plant operations. Specifically, operations at Raglan Mine are shut down during the winter months until spring and our joint venture operations in China typically go through a dry season with low volumes of water requiring treatment.

During Q1 2020, our share of revenues from our joint venture operations at Dexing Mine was at a 12-year historic low due to extremely low rainfall in Jiangxi province. Furthermore, our joint venture operation in Shandong province had lower production as operations were suspended for approximately 25 days due to temporary COVID-19 related travel restrictions and disruptions to our reagent supply chain. Despite the loss of revenues from our joint ventures, the positive Adjusted EBITDA reported in Q1 2020 can be attributed to significant increases in technical services revenues in North America. This increase reflects our strong project pipeline which has been the focus of the Company’s management over the last several years. Crucially, a large component of the projects that contributed to our technical services revenues in Q1 are expected to develop into recurring operations revenues for the Company in the future.

Looking ahead to the rest of the year, we anticipate successful operations at Raglan Mine, where we initiated our 17th treatment season in April 2020, and at the copper and zinc recovery plants in Jiangxi and Shandong provinces in China. Additionally, we anticipate the successful commissioning of several new water treatment plants that will subsequently transition into ongoing operations. The plants include:

  • The first Selen-IX™ plant at Kemess Mine in Northern BC;
  • A SART plant at a gold metallurgical facility owned by Zhongkuang Group Co.; and
  • A SART plant at a gold metallurgical facility owned by Zhaojin Mining Industry Co.

We further anticipate that procurement and construction will continue for two new plants in the US: a Selen-IX™ plant at a power utility site for ash pond clean-up and an upgrade to an existing water treatment plant for simultaneous sulphate and selenium removal at a US mine. These new projects are expected to start producing recurring revenues in the next 12 to 18 months. Our operations and technical services were able to continue despite the COVID-19 pandemic, and management has determined that the Company’s ability to execute its medium- and longer-term plans is unlikely to be materially impacted. The Company also has a strong liquidity position which management feels is more than adequate to fund our business during this period.

Although our forecast for the remainder of 2020 and 2021 is generally positive, the Company believes it is prudent to caution our shareholders on the uncertainties that could impact our forecast. As the global COVID-19 crisis continues to develop, significant risks may arise in our ability to operate, particularly as they relate to potential government laws and regulations, business hindrances to our supply chains, and disruptions in the markets for our services. Moreover, geopolitical uncertainties represent a risk for our China operations and weak commodity prices or foreign exchange rates may lead to a major slow-down in the global mining industry, which may negatively affect the Company’s long-term prospects.


For a complete set of Financial Statements and Management Discussion and Analysis, please go to

(in $’000 except for per share amounts)

Q1 2020

Q1 2019

$ $
Revenues 1,936 716
Operating expenses 1,195 444
741 272
General and administration expenses 433 383
Sales and development expenses 229 319
Share-based payment expenses 49 22
Depreciation 36 50
Share of loss (income) from joint ventures 127 (202)
Loss from operations and joint ventures (133) (300)
Other income (expense), net 115 (27)
Net loss for the period (18) (327)
Other comprehensive income (loss)  
Translation gain on foreign operations 387 27

Comprehensive income (loss) for the period





Net loss per share (basic and diluted) (0.02) (0.27)
Non-GAAP Measures:  
Proportional Revenues 2,356 2,057
Adjusted EBITDA 91 (80)
at Mar. 31, at Dec. 31,



Working capital 2,255 1,829
Total assets 8,793 8,376
Total non-current liabilities 481 331
Shareholders’ equity 6,861 6,405

About BQE Water
BQE Water is a service provider specializing in water treatment and management for metals mining, smelting and refining. We are helping to transform the way the industry thinks about water in the context of natural resource projects by offering services and expertise which enables more sustainable water management practices and improved overall project performance at reduced risks. BQE Water invests in innovation and has developed unique intellectual property through the commercialization of several new technologies at mine sites around the world for organizations including Glencore, Jiangxi Copper, Freeport-McMoRan and the US EPA. BQE Water is headquartered in Vancouver, Canada and trades on the TSX Venture Exchange under the symbol BQE. Visit for more information.


The Toronto Venture Exchange has not reviewed and does not accept responsibility for the adequacy or the accuracy of this release.

Certain information contained herein may not be based on historical fact and therefore constitutes “forward-looking information” under applicable Canadian securities legislation. This includes without limitation statements containing the words “plan”, “expect”, “project”, “estimate”, “intend”, “believe”, “anticipate”, “may”, “will” and other similar words or expressions. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks, uncertainties and other factors that may cause actual events or results to differ materially from those expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the Company’s dependence on key personnel and contracts, uncertainty with respect to the profitability of the Company’s technologies, competition, technology risk, the Company’s ability to protect its intellectual property and proprietary information, fluctuations in commodity prices, currency risk, environmental regulation and the Company’s ability to manage growth and other factors described in the Company’s filings with the Canadian securities regulators at (including without limitation the factors described in the section entitled “Risks and Uncertainties” in the Company’s MD&A for the year ended December 31, 2019). Given these risks and uncertainties, the reader is cautioned not to place undue reliance on forward-looking statements. All forward-looking information contained herein is based on management’s current expectations and the Company undertakes no obligation to revise or update such forward-looking information to reflect subsequent events or circumstances, except as required by law.