Trilogy Metals Shares Rocket as US Government Takes Stake in Alaska Project

The US government is making a rare direct investment in a Canadian mining company, taking a 10 percent stake in Vancouver-based Trilogy Metals (TSX:TMQ,ARCA:TMQ) as part of a US$35.6 million deal to accelerate the development of Alaska’s Upper Kobuk Mineral Projects (UKMP)

In an announcement Monday (October 6), Trilogy said it has entered into a binding letter of intent with the US Department of War, through the Office of the Undersecretary of Defense for Acquisition and Sustainment and the Office of Strategic Capital, alongside its joint venture partner South32 (ASX:S32,OTC Pink:SHTLF).

Under the terms of the deal, the US government will invest approximately US$17.8 million directly into Trilogy Metals in exchange for 8.2 million units priced at US$2.17 apiece. Each unit will consist of one common share and three-quarters of a 10-year warrant exercisable for a penny per share following completion of the Ambler Road.

Another US$17.8 million will go to South32 in exchange for 8.2 million shares of Trilogy currently held by the Australian miner, plus a call option on an additional 6.1 million shares at the same US$0.01 exercise price.

All proceeds, Trilogy said, will be reinvested into its joint venture company Ambler Metals which holds the UKMP in Alaska’s resource-rich Ambler Mining District.

The US government’s total stake in Trilogy will amount to about 10 percent, and it will have the right to appoint an independent director to the company’s board for three years.

“This proposed partnership with the US Government represents a significant milestone for Trilogy Metals and for the development of a secure, domestic supply of critical minerals for America in Alaska,” said Tony Giardini, Trilogy’s president and CEO.

“The Department of War’s interest underscores the strategic importance of the Upper Kobuk Mineral Projects in supporting US energy, technology, and national security priorities.”

The deal also includes provisions for debt limits and a framework for collaboration on advancing the Ambler Road—an industrial-use-only, 211-mile corridor that would connect the remote Ambler Mining District to Alaska’s Dalton Highway.

The road, overseen by the Alaska Industrial Development and Export Authority (AIDEA), has long been seen as critical to unlocking access to vast deposits of copper, cobalt, zinc, and lead.

The project also received a major political boost on Monday when President Trump invoked his authority under Section 1106 of the Alaska National Interest Lands Conservation Act (ANILCA) to overturn the Biden administration’s 2024 “No Action” decision that had halted the road’s progress.

The reversal reinstates federal right-of-way permits and directs agencies to finalize all authorizations needed for construction.

“This landmark decision is a turning point for Trilogy and for the future of domestic critical mineral development in the United States,” Giardini said. “The Ambler Road is not just a pathway to economic growth in Alaska – it’s a strategic asset for the United States.”

The Ambler Mining District is among North America’s richest undeveloped sources of copper and associated base metals. Trilogy’s Arctic and Bornite deposits are central to that potential, with the company and South32 envisioning a multi-decade mining hub capable of supplying key materials for power grids, defense systems, and clean energy technologies.

US Interior Secretary Doug Burgum said the investment underscores Washington’s intent to secure its mineral supply chains. Notably, the Trump administration has made a series of similar moves in recent months as part of a broader critical minerals strategy.

Last week, the US government took a minority stake in Lithium Americas (TSX:LAC,NYSE:LAC), providing US$435 million in federal funding to advance the Thacker Pass lithium project in Nevada.

Recently, Washington has also been reportedly exploring a potential equity position in Critical Metals (NASDAQ:CRML), which controls Greenland’s Tanbreez rare earths project.

Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.