is successfully completing the requirements necessary to conclude the environmental impact statement process for Stibnite, its gold-antimony project in Idaho, "to be construction ready in the next 12 months," reported ROTH Capital Partners analyst Mike Niehuser in an August 22 research note.
"We believe that Perpetua has a clear pathway to be awarded a record of decision for the proposed development," Niehuser wrote. "This may soon transform the company's perception by investors for the Stibnite gold project to be a bankable project."
As far as timing, the U.S. Forest Service outlines a final environmental impact statement and draft record of decision by year-end 2023, followed by a final record of decision in early 2024.
129% Implied Return
Accordingly, ROTH maintained its US$7.25 per share target price on the mining company, currently trading at about US$3.05 per share, noted Niehuser.
The projected potential return for investors is material, at 129%.
Perpetua remains a Buy.
Critical Steps Taken
Niehuser presented the actions Perpetua has taken to move Stibnite toward a record of decision, including forming partnerships.
"Most of the stakeholders are aligning in a common cause to advance the project through permitting, construction, and production," added Niehuser.
One, the Idaho-headquartered explorer signed a Clean Water Act Settlement Agreement with the Nez Perce Tribe, establishing the "parameters of activities" it deems essential. Relatedly, Perpetua is currently mobilizing people and equipment to carry out the agreed-upon cleanup of waste and measures to improve and maintain water quality.
Second, Perpetua signed a Definitized Agreement for Critical Minerals with the U.S. Department of Defense (DOD) for an award of US$24.8 million ($24.8M) under the Defense Production Act. These monies are "intended to support construction readiness and environmental studies to continue through the permitting process," explained Niehuser.
Third, with an eye toward production at Stibnite, Perpetua hired an experienced and accomplished mining project development professional, Michael Wright, to serve as vice president of projects, a positive move according to ROTH.
"This is significant for its organization to transition from a permitting focus to define the Stibnite gold project to be financeable," Niehuser commented.
Funding for Antimony Efforts
Antimony is deemed strategically important to the U.S.' national defense, but no domestic sources of it exist. China, Russia, and Tajikistan provide 90% of the world's supply.
As such, the DOD's Defense Logistics Agency awarded Perpetua two grants of US$100,000 in September 2022. These are to support the company's evaluation of whether antimony from Stibnite can meet military specifications for use in munitions. This will require bench-scale testing of the element.
Further, earlier this month, the DOD's Ordnance Technology Consortium awarded Perpetua a Technology Investment Agreement of $15.5M to develop a wholly domestic antimony trisulfide supply chain of military-grade Stibnite ore.
"Perpetua plans on obtaining additional material for a pilot plant study to produce military-grade antimony and a full-scale processing circuit that may be useful to assess further projects," wrote Niehuser.
|Want to be the first to know about interesting Gold and Critical Metals investment ideas? Sign up to receive the FREE Streetwise Reports' newsletter.||Subscribe|
- Perpetua Resources Corp. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
- Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor/employee.
For additional disclosures, please click here.
Disclosures for Roth, Perpetua Resources Corp., August 22, 2023
Regulation Analyst Certification ("Reg AC"): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.
Disclosures: Shares of Perpetua Resources Corp. may be subject to the Securities and Exchange Commission's Penny Stock Rules, which may set forth sales practice requirements for certain low-priced securities.
ROTH Capital Partners, LLC expects to receive or intends to seek compensation for investment banking or other business relationships with the covered companies mentioned in this report in the next three months. The material, information and facts discussed in this report other than the information regarding ROTH Capital Partners, LLC and its affiliates, are from sources believed to be reliable, but are in no way guaranteed to be complete or accurate. This report should not be used as a complete analysis of the company, industry or security discussed in the report. Additional information is available upon request. This is not, however, an offer or solicitation of the securities discussed. Any opinions or estimates in this report are subject to change without notice. An investment in the stock may involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Additionally, an investment in the stock may involve a high degree of risk and may not be suitable for all investors. No part of this report may be reproduced in any form without the express written permission of ROTH. Copyright 2023. Member: FINRA/SIPC.