"12,500% price gain!" Perpetua Resources and its Stibnite project were abused by a US stock market letter with lurid advertising. Although this is groundless, the company's Stibnite project has great strategic value for the USA. We do a reality check: what is really behind the asset and the share?
12.500? "Exaggerated by far!"Perpetua Resources (US$ 3.8150 | $PPTA) is working very solidly to revive an abandoned antimony and gold mine in the US state of Idaho. The 12,500% are by far exaggerated, wrote Chris Fogg, who is responsible for investor relations at Perpetua Resources. However, the share, which is listed on the Nasdaq and the TSX in Toronto, is certainly an interesting investment. If everything goes according to plan, one of the largest gold mines in the USA will be built here by 2028.
Successful new startMidas Gold, as Perpetua was known until 2021, had been working on the Stibnite project since 2011. The restart began in 2020 when a famous hedge fund exchanged two convertible bonds for shares. Hedge fund manager John Paulson became famous for betting on falling share prices in 2008 and making a lot of money. His company Paulson & Co. is currently the major shareholder in Perpetua Resources with 39.2%. In this respect, the stock market letter advertisement is right about one thing: John Paulson should know what a profitable investment is.
In December 2020, a new top manager, Laurel Sayer, was appointed as CEO. In February 2021, the name was changed from Midas Gold to Perpetua Resources. The name is a direct reference to Idaho's motto, Este Perpetua. "Perpetua" translates into English as "eternal". The name is intended to express that the company wants to use Idaho's abundant resources for generations to come. A great deal has been achieved since 2021, particularly in terms of the approval of mining operations. All permits should be in place by the end of 2024 - the trigger for a higher share price for speculators.
A huge environmental messIf you look at the mine site from the air, you realize that it's all a huge mess. The mountain slopes have been eaten away by erosion. Over the past 120 years, hundreds of thousands of tons of toxic waste material have been dumped unchecked, and the water and soil are contaminated. In 1938, a river was diverted so that the salmon can no longer migrate upstream. Former operators of the mine never thought to clean up the environmental damage they had caused.
No wonder there are environmentalists who are in ...
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