Quarterly report pursuant to Section 13 or 15(d)

Property and equipment, net

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Property and equipment, net
 6 Months Ended
Jun. 30, 2017
Property, Plant and Equipment [Abstract]  
Property and equipment, net

5.        Property and equipment, net

 

Property and equipment, net, consisted of the following (in thousands):

 

    Useful Life     June 30,     December 31,  
Asset Class   (Years)     2017     2016  
                   
Operational equipment     3-10     $ 15,795     $ 15,132  
Lab equipment     5       648       547  
Computer equipment     3       161       140  
Office furniture and equipment     5       317       298  
Leasehold improvements     5-7       1,408       1,408  
Land     —       1,048       1,047  
Building     39       24,641       21,962  
Asset Retirement Cost     20       670       —  
Equipment under construction             1,889       1,635  
              46,577       42,169  
Less:  accumulated depreciation             (2,152 )     (777 )
                         
            $ 44,425     $ 41,392  

 

Depreciation expense was $722,000 and $1,387,000 for the three and six months ended June 30, 2017, respectively and $120,000 and $198,000 for the three and six months ended June 30, 2016, respectively. The building is a 136,750 square foot lead acid battery recycling plant located in McCarran, Nevada. Equipment under construction is primarily AquaRefining modules manufactured by the Company to be used in the McCarran, Nevada recycling plant.

 

Certain costs necessary to make the recycling facility ready for its intended use have been capitalized, including interest expense on notes payable. Capitalized interest totaled $152,000 and $303,000 for the three and six months ended June 30, 2016, respectively. Capitalization of interest ceased upon completion of the building in early November 2016.