Prediction: TMC The Metals Company Will Soar Over the Next Year -- 2 Key Catalysts to Watch
Written by James Halley for The Motley Fool -> The Canadian company's U.S. subsidiary is applying for a permit to mine the Pacific Ocean for rare metals. The stock is up over 23% so far this year as the company looks to navigate past international regulations. TMC The Metals C
The Canadian company's U.S. subsidiary is applying for a permit to mine the Pacific Ocean for rare metals.
The stock is up over 23% so far this year as the company looks to navigate past international regulations.
TMC The Metals Company (NASDAQ: TMC) is a Vancouver-based deep-sea minerals exploration company that collects and processes small nodules found on the seafloor. They contain nickel, cobalt, copper, and manganese -- metals essential for electric vehicle (EV) batteries, energy storage, and the global transition to clean energy.
The mining stock is up more than 23% so far this year. The company said its U.S. subsidiary, The Metals Royalty Company (NASDAQ: TMCR) , which began public trading in April and whose shares are up 80%, will apply for a U.S. mining permit to harvest rare metals at the bottom of the Pacific Ocean in the Clarion-Clipperton zone. The company received certification from the National Oceanic and Atmospheric Administration (NOAA) for its exploration license application on May 28.
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The stock remains a speculative bet because it has no revenue. In the first quarter, it reported a net loss of $20.6 million and cash of $119 million. Also, getting approval for the license application means jumping through a series of regulatory hurdles. However, there are two major catalysts that may drive the stock this year.
One way the stock could soar over the next year is if it can bypass the International Seabed Authority, a United Nations-run intergovernmental body that regulates the international seabed. More than 35 countries have called for a moratorium on deep-sea mining, including Canada. However, the United States has not ratified the UN Convention on the Law of the Sea (UNCLOS), so there is a path forward for The Metals Company, through its subsidiary, to obtain domestic approval for seabed mining.
NOAA certified that the application submitted by The Metals Company is in substantial compliance with legal requirements, granting it threshold eligibility. NOAA is moving forward with a substantive, fast-tracked environmental and technical review of The Metals Company's 122,000-square-kilometer project area in the Clarion-Clipperton Zone.
