SS1 appoints strategic advisor for US engagement strategy

Our 2024 Small Cap Pick of the Year Sun Silver (ASX: SS1) just appointed a new strategic advisor.

SS1 appointed former Alcoa executive Dennis Lindgren as whose sole focus for SS1 will be to engage with the US Government on behalf of SS1.

Dennis played a key role in the funding announced recently which will go to Alcoa to construct a Gallium project in WA, with US$200M to be received from this initiative.

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SS1’s project already has a 480M ounce silver equivalent JORC resource.

SS1’s project is the biggest undeveloped silver project on the ASX and in the USA.

Dennis previously led Alcoa’s Gallium Project, a US Government-backed initiative announced during the recent Trump-Albanese meeting in Washington D.C, which became a flagship of the US-Australia Critical Minerals Partnership.

He played a central role in aligning US, Japanese, and Australian interests, securing trilateral commercial and strategic agreements, and obtaining direct US Government support under the allied critical-minerals framework.

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Ultimately we are hoping Dennis can leverage all of the networks he built while at Alcoa in SS1’s favour.

Government funding could be what unlocks SS1’s project

SS1 recently finalised a white paper to submit to the Department of Defence (DoD) for funding.

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And we note that SS1 has explicitly said that it was pursuing US DoD funding right now…

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Why is that important?

Because we think government funding could ultimately be what unlocks SS1’s giant silver resource.

SS1’s silver deposit starts from ~200m underground - which is considered relatively deep.

Yes, an estimated 480M ounces is a LOT of silver, but SS1 needs to dig a big expensive hole (pit) to reach it before they can extract and sell it.

That pre-strip (digging down to the juicy valuable bits of the project) means a lot of upfront capital spend which is typically where project financiers get scared off a project.

Conventional project financiers (and equity investors) want as fast a payback as possible with mining projects, big CAPEX upfront can scare off these investors.

As the silver price goes higher that pre-strip matters less and less.

BUT government funding or some sort of government-backed loan could be what really unlocks SS1’s project.

Exactly the same way it did for Perpetua’s project in Idaho.

Perpetua received commitments for a US$1.8BN loan from US Export-Import Bank and then private capital started pouring into the company in a big way.

Perpetua's market cap has gone from $300M to $4.3BN.

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The past performance is not and should not be taken as an indication of future performance. Caution should be exercised in assessing past performance. This product, like all other financial products, is subject to market forces and unpredictable events that may adversely affect future performance.

We think a similar re-rate could happen to SS1 if the government was to backstop its project with some sort of funding deal.

What’s next for SS1?

We have been talking about what might trigger a rally in SS1’s share price in 2025 since the start of this year.

Of the 6 catalysts that we have forecast for SS1, so far 4 of them have played out in SS1’s favour:

• ✅ Silver price runs - Silver is now in uncharted territory having recently spent time above US$50 per ounce.
• ✅ Exploration success - SS1 with the first hole of its 2025 drill program delivered its best ever drill result 70m of mineralisation outside of the current resource. An interval with grades as high as 10,548g/t silver.
• ✅ SS1 reaches a size where it gets added to index funds - SS1 was added to the Sprott Silver Miner and Physical Silver ETF and the ETF has been increasing its holding…
• ✅ SS1 delivers an antimony surprise - SS1 is working towards a “potential maiden antimony mineral resource”.
• 🔄 SS1 resource update - SS1 is drilling its project right now.
• 🔄 SS1 met test work results - SS1 is also working on this right now.