Perpetua Resources Corp. (PPTA:TSX; PPTA:NASDAQ), in the funding phase of its Stibnite gold-antimony project in Idaho, is preparing a formal debt financing application for submittal to the Export-Import Bank of the United States (EXIM), reported Mike Niehuser, managing director and senior research analyst at ROTH Capital Partners, in a March 13 research note.
"We view financing by EXIM to be the optimal source of debt financing," Niehuser wrote. "The terms may be preferable to conventional financing."
106% Return Potential
On the news, ROTH maintained its $19 per share 12-month price target on Perpetua.
"This reflects our optimism for favorable financing terms from EXIM, the potential availability of additional sources of funding to balance the budget and additional exploration, adding resources which extend mine life and result in more robust project economics," explained Niehuser.
The Idaho-based explorer-developer's current share price is about $9.22. From this price, the return to target is 106%.
Perpetua remains a Buy.
Updated Capex Requirement
Last April, during the Biden Administration, EXIM, in a letter of interest to Perpetua, proposed $1.8 billion ($1.8B) in debt financing for advancement of the Stibnite project, reiterated Niehuser. This figure was based on capex, project viability and job creation outlined in the 2020 feasibility study.
In February of this year, however, the company updated the Stibnite budget, which resulted in a new capex amount of $2.215B, including contingency. The difference between the 2020 and 2025 totals is attributed to inflation, fixing contracts, own versus lease optimization and contractor selection.
Fast, Fair Review Expected
ROTH expects EXIM to fairly review the higher loan amount, Niehuser wrote, based on updated project economics, revisited job creation figures and Executive Orders by the Trump Administration.
The senior analyst relayed that, according to Perpetua management, under the new administration, people have been added to the EXIM board to comprise a quorum, sufficient for approving debt.
Further, ROTH expects EXIM will expedite the application given certain of President Donald Trump's recent and past executive orders, including:
- Unleashing American Energy (Jan. 20, 2025)
- Declaring a National Energy Emergency (Jan. 20, 2025)
- Addressing the Threat to the Domestic Supply Chain from Reliance on Critical Minerals from Foreign Adversaries and Supporting the Domestic Mining and Processing Industries (Sept. 30, 2020)
These directives show his commitment to bolstering domestic supply of critical elements and recognizing the need to prioritize mining project permitting and metals production, processing and refining.
Critical Nature of Antimony
Niehuser highlighted that the antimony supply in the U.S. and globally are in a growing deficit, in large part due to China. The Asian country banned sales of antimony trisulfide to the U.S. and its allies and it is a net importer of the metal for solar panel manufacturing. Thus, the Stibnite project is a critical potential source of antimony for the U.S.
Timeline of Future Events
Perpetua is expected to submit the debt financing application within the coming weeks, Niehuser reported. Once EXIM determines the application complete, a decision should come within 45 days.
Niehuser purported that if EXIM approves Perpetua's application, the mining company likely will tap other financing sources, potentially equity, grants, monetizing potential revenue streams or other vehicles, to cover all construction costs.
In the meantime, Perpetua will continue technical and other preconstruction work. Receipt of additional permits is expected by Q2/25E.
"In our opinion, Perpetua may close financing mid-year and move into construction, with production commencing in late 2028," wrote Niehuser.
Other Stock Data
Perpetua has 70.17 million shares outstanding. Its market cap is $644.83 million. Its 52-week range is $3.94−12.80 per share.
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