Thacker Pass in Nevada is home to the largest lithium deposit in America and one of the biggest in the world. Following several years gaining regulatory approval, construction of a mine has begun, with the first sales expected by 2026.
Once up and running, the mine should deliver about 80,000 tons of lithium a year, generating almost $2.5 billion (£2 billion) of annual revenue at today’s prices.
Thacker is the source of considerable excitement in certain US circles. Lithium is a crucial component in electric car batteries, China dominates the market and President Biden is keen to shift production closer to home.
Thacker has a central role to play and car giant General Motors signalled its support with a $650 million investment earlier this year.
Two years ago, Trident Royalties signed a royalty agreement with the owners of Thacker Pass, entitling the AIM-listed firm to 1.05 per cent of annual revenue, equating to $25 million at current prices.
Taking charge: Lithium is a crucial component in electric car batteries
Trident has come a long way since floating in May 2020. Back then, chief executive Adam Davidson had one royalty agreement to his name, an iron ore project in Australia.
Today, 20 royalty deals are in place, covering a range of base and precious metals, including gold, silver and copper, as well as lithium. Projects span the mining world, from the US and Canada to Mexico and Brazil to pockets of Africa.
More than half the sites are already in production. The rest are in construction or at a relatively early stage, but the combination is designed to deliver a steady stream of revenues over many years.
Last week, Davidson showed the strategy was delivering results. Royalty receipts soared 45 per cent in the first half of 2023, with further growth expected this year and beyond. Davidson also sold a group of gold royalties for $15.5 million, having paid $6.25 million for them two years ago.
And in the past few weeks, two new royalty deals were completed – a lithium deal in Utah and one for gold in Mali, which may sound risky but is reassuringly close to a large, established American mine.
Midas verdict: Midas recommended Trident Royalties in 2021 at 34p. The shares have risen 29 per cent to 43.5p since then, but should continue to gain ground. Davidson and finance chief Richard Hughes have spent more than £200,000 of their own money acquiring stock in recent months. Investors should take note.
Traded on: AIM Ticker: TRR Contact: tridentroyalties.com or 001 757 208 5171
#fiveDealsWidget .dealItemTitle#mobile {display:none} #fiveDealsWidget {display:block; float:left; clear:both; max-width:636px; margin:0; padding:0; line-height:120%; font-size:12px} #fiveDealsWidget div, #fiveDealsWidget a {margin:0; padding:0; line-height:120%; text-decoration: none; font-family:Arial, Helvetica ,sans-serif} #fiveDealsWidget .widgetTitleBox {display:block; float:left; width:100%; background-color:#af1e1e; } #fiveDealsWidget .widgetTitle {color:#fff; text-transform: uppercase; font-size:18px; font-weight:bold; margin:6px 10px 4px 10px; } #fiveDealsWidget a.dealItem {float:left; display:block; width:124px; margin-right:4px; margin-top:5px; background-color: #e3e3e3; min-height:200px;} #fiveDealsWidget a.dealItem#last {margin-right:0} #fiveDealsWidget .dealItemTitle {display:block; margin:10px 5px; color:#000; font-weight:bold} #fiveDealsWidget .dealItemImage, #fiveDealsWidget .dealItemImage img {float:left; display:block; margin:0; padding:0} #fiveDealsWidget .dealItemImage {border:1px solid #ccc} #fiveDealsWidget .dealItemImage img {width:100%; height:auto} #fiveDealsWidget .dealItemdesc {float:left; display:block; color:#004db3; font-weight:bold; margin:5px;} #fiveDealsWidget .dealItemRate {float:left; display:block; color:#000; margin:5px} #fiveDealsWidget .dealFooter {display:block; float:left; width:100%; margin-top:5px; background-color:#e3e3e3 } #fiveDealsWidget .footerText {font-size:10px; margin:10px 10px 10px 10px;} @media (max-width: 635px) { #fiveDealsWidget a.dealItem {width:19%; margin-right:1%} #fiveDealsWidget a.dealItem#last {width:20%} } @media (max-width: 560px) { #fiveDealsWidget #desktop {display:none;} #fiveDealsWidget #mobile {display:block!important} #fiveDealsWidget a.dealItem {background-color: #fff; height:auto; min-height:auto} #fiveDealsWidget a.dealItem {border-bottom:1px solid #ececec; margin-bottom:5px; padding-bottom:10px} #fiveDealsWidget a.dealItem#last {border-bottom:0px solid #ececec; margin-bottom:5px; padding-bottom:0px} #fiveDealsWidget a.dealItem, #fiveDealsWidget a.dealItem#last {width:100%} #fiveDealsWidget .dealItemContent, #fiveDealsWidget .dealItemImage {float:left; display:inline-block} #fiveDealsWidget .dealItemImage {width:35%; margin-right:1%} #fiveDealsWidget .dealItemContent {width:63%} #fiveDealsWidget .dealItemTitle {margin: 0px 5px 5px; font-size:16px} #fiveDealsWidget .dealItemContent .dealItemdesc, #fiveDealsWidget .dealItemContent .dealItemRate {clear:both} }
This post first appeared on Dailymail.co.uk
