Trigon Metals Inc. (PNTZF) has reached a major milestone in its underground operations at the Kombat Mine, achieving a production rate of 980 tonnes per day (tpd) over a 30-day period. This accomplishment, highlighted by Atrium Research analysts Ben Pirie and Nicholas Cortellucci, surpasses a crucial benchmark stipulated in the company’s streaming agreement with Sprott. The analysts maintain a Buy rating and a target price of CA$3.50 on the stock, indicating a substantial potential return for investors.
This production success has led Trigon to make a strategic decision to temporarily halt its open pit mining activities. Atrium Research explains that this move is driven by the fact that the underground mine’s output is just below the current milling capacity of 1,000tpd, and processing the higher-grade underground ore is significantly more profitable. Pirie and Cortellucci express their optimism about these developments, believing they will lead to more profitable quarters and increased production for Trigon in the future.
The report also sheds light on Trigon’s ongoing exploration activities, highlighting a ~3,500m drill program that has yielded promising results, particularly the discovery of high-grade copper outside the existing resource near Shaft #3. This area is expected to become a key mining zone as Trigon scales its throughput from 1,000tpd to 2,000tpd next year.
While Atrium Research’s valuation methodology for Trigon Metals is not explicitly detailed in the report, their Buy rating and target price of CA$3.50, representing a potential return of approximately 456% from the current price, underscores their strong confidence in the company’s future. Key catalysts identified by the analysts for Trigon’s continued success include quarterly production and financial results, as well as ongoing drill results at Kombat and expansion drilling efforts. These ongoing activities are anticipated to drive the company’s valuation in the near term.
