US grants Perpetua critical mineral permit amid China tensions

Houston — The Biden administration has issued the final mining permit for Perpetua Resources’ Idaho antimony and gold project, a move aimed at spurring US production of a critical mineral at the centre of a widening trade war between Washington and Beijing.

The permit for Perpetua, backed by billionaire investor John Paulson, comes after Beijing in December blocked exports to the US of antimony, a metal used to make weapons, solar panels, flame retardants and other goods for which there are no current American sources.

The US Forest Service released the final record of decision for Perpetua’s Stibnite project — the mine’s permit — after an eight-year review process, according to documents published on the agency’s website.

On Friday, shares of Idaho-based Perpetua gained 9.1% after the permit decision was reported.

Perpetua’s mine will supply more than 35% of America’s annual antimony needs once it opens by 2028 and produce 450,000 ounces of gold each year. The dual revenue stream is expected to keep the project financially afloat regardless of any steps Beijing may take to sway markets.

For example, Jervois Global, the owner of an Idaho mine that produces only cobalt, declared bankruptcy on Thursday after Chinese miners aggressively boosted production of that metal in a bid for market share.

In its 154-page report, the Forest Service said its decision on Perpetua’s permit was based on a detailed review of environmental data, discussions with indigenous groups and consultation with other federal agencies.

“I have taken into consideration the degree to which the (mine’s) environmental design features, monitoring, and mitigation measures will, where feasible, minimise adverse environmental impacts on (federal lands),” the Forest Service’s Matthew Davis said in the report.

Perpetua, which changed its mine design three times in response to critics, said it believed it could make the mine, about 222km north of Boise in Idaho, “the best it can be”.

“Every detail of this project was examined with a fine-tooth comb,” said Perpetua CEO Jon Cherry.

Perpetua will need to obtain a wetlands permit from the US Army Corps of Engineers, though the Forest Service said its own decision was made in consultation with that agency, implying a smooth review process.

The Stibnite project was forecast in 2020 to cost $1.3bn, a number expected to rise due to post-pandemic inflation. The site has estimated reserves of 148-million pounds of antimony and 6-million ounces of gold.

The Pentagon committed nearly $60m to the project, which would entail cleaning and expanding a site that was polluted by World War 2-era mining.

Perpetua last April received a letter of interest from the US Export-Import Bank, the government’s export credit agency, for a loan worth up to $1.8bn to fund the Stibnite project.

The project has not won the support of Idaho’s Nez Perce tribe, which is concerned it could affect the state’s salmon population.

The Nez Perce tribe said in a statement it was still reviewing the final decision, though “not with optimism”, adding it believed the Forest Service “has been rushing to approve Perpetua Resource’s mine proposal without undertaking its required due diligence”.

Reuters