PPTA - Co.'s Stock Soars on Possible Export-Import Bank Loan News | Benzinga
Source: Streetwise Reports 04/10/2024
Perpetua Resources Corp.'s Stibnite project in Idaho has a mineral you may not have heard of: Antimony. But it's an important material needed for national defense, and right now most of it comes from China, Russia, and Tajikistan.
As the West continues to try and break free of resource dependence on China in the new green economy, developer Perpetua Resources Corp. (NASDAQ: PPTA) announced it has received a Letter of Interest (LI) from the Export-Import Bank (EXIM) of the United States for up to US$1.8 billion financing for its Stibnite gold and antimony project in Idaho.
Antimony is important to national defense as a key material used in munitions, but no domestic supply is currently mined and China, Russia, and Tajikistan control 90% of the supply chain, the company said.
The loan would be offered through EXIM's "Make More in America" and "China and Transformational Exports Program" initiatives, noted analyst Mike Kozak of Cantor Fitzgerald in a Monday research note.
"According to PPTA, the LI indicated that the potential US$1.8 (billion) in supportive debt financing may also be eligible for special consideration under Section 402 of EXIM's reauthorization that directs it to take steps to mitigate the competitive impact of export support provided by the People's Republic of China" wrote Kozak, who rated the stock a Speculative Buy with a CA$16.50 target price.
Kozak continued, "The potential US$1.8 (billion) of EXIM project financing support directly relates to the antimony by-product (critical for munitions) that will be produced at PPTA's Stibnite open-pit gold project (Idaho)."
Perpetua's stock rose 44% following the news to CA$9.34 by Tuesday morning.
Perpetua's stock rose 44% following the news to CA$9.34 by Tuesday morning.
The company said it expects to submit a formal application to the bank this year, upon which EXIM will conduct due diligence to determine if a final commitment can be issued.
"Note that initial CAPEX was estimated at US$1.3 (billion) in the 2020 Feasibility Study (FS) (and) will need to be updated to reflect industry cost inflation" Kozak wrote.
Analysts Lucas N. Pipes and Nick Giles of B. Riley Securities wrote in an ...