Victory Metals: Seizing the Fortunes of Federal Funding in the Critical Minerals Race

The U.S. government's push to secure domestic control over critical minerals—vital for defense systems, electric vehicles (EVs), and renewable energy—has thrust Victory Metals (VTM) into the spotlight. With recent approvals and strategic partnerships, the company is positioned to capitalize on a reshaped supply chain landscape dominated by geopolitical urgency and decarbonization demands. Here's why VTM could be a cornerstone of this emerging boom.

The SAM.gov Catalyst: Unlocking Federal Contracts

Victory's recent inclusion in the U.S. government's System for Award Management (SAM.gov) is a game-changer. This approval, expected to finalize by late Q3 2025, grants direct access to federal defense and infrastructure contracts. For context, the Department of Defense (DoD) alone requires 200kg of rare earth oxides per F-35 fighter jet, and EV manufacturers like Tesla are racing to secure battery-grade materials.

SAM.gov's greenlight enables VTM to compete for multi-year contracts tied to the Biden administration's $2.3 trillion infrastructure plan, which prioritizes domestic critical minerals production. Defense Production Act (DPA) funding—already backing VTM's North Stanmore project—signals a strategic bet on reducing reliance on China, which currently dominates 85% of global rare earth processing.

Note: A breakout above $1.20 resistance could signal SAM approval confirmation.

The EXIM Bank Backing: Financing a Geopolitical Play

Victory's $292 million non-binding Letter of Interest (LOI) from the U.S. EXIM Bank underscores the project's national security value. The financing, structured under the DPA, offers a 15-year repayment term—a lifeline for long-cycle mining projects. This contrasts sharply with commercial loans, which typically demand shorter payback periods.

The North Stanmore project in Western Australia hosts 247.5 million tonnes of rare earth oxides and 4,788 tonnes of gallium oxide—materials critical for semiconductors, radar systems, and EV batteries. Crucially, VTM's gallium oxide recovery process operates at a projected $20/kg cost, undercutting Chinese competitors. This edge positions VTM to supply the U.S. with up to 10% of its annual rare earth demand, a market currently starved of non-Chinese alternatives.

Saudi Arabia's Stake: A Geopolitical Safety Net

A $10 million unsecured loan facility from Saudi Arabia's Sanabil Investments—a PIF subsidiary—adds another layer of stability. This aligns with Saudi Vision 2030 goals to diversify its economy and join the critical minerals race. The partnership not only de-risks the project but also opens doors to Middle Eastern markets, where EV adoption is accelerating.

Defense and EV Demand: The Demand Side Advantage

The project's minerals feed two of the world's fastest-growing markets:
1. Defense: Rare earth oxides are indispensable for precision-guided missiles, radar systems, and the F-35 fleet. The U.S. plans to produce 2,000 F-35s by 2030, each requiring 200kg of these oxides.
2. EVs and Renewables: Neodymium-praseodymium (NdPr) in rare earth oxides are used in EV motors and wind turbine magnets. Analysts estimate global NdPr demand could grow 15% annually through 2030.

Financials and Technicals: A Foundation for Growth

• Pre-Feasibility Study (due mid-2026): This milestone will validate metallurgical processes and economic viability, attracting further financing.
• Cash Position: With $6.46 million in cash as of June 2025, VTM has runway to navigate the pre-feasibility phase without immediate dilution.
• Stock Dynamics: The stock has consolidated in a symmetrical triangle pattern, with support at $0.85 and resistance at $1.20. A SAM approval announcement could trigger a surge toward $1.50–$1.80, reflecting an 85% upside from current levels.

Risks to Monitor

• SAM Approval Delays: Regulatory hurdles could push timelines into 2026, prolonging uncertainty.
• Commodity Volatility: Rare earth prices are tied to EV demand and geopolitical tensions. A slowdown in EV adoption or China-U.S. détente could temper urgency.
• Cost Overruns: The pre-feasibility study may reveal unexpected expenses, squeezing margins.

Investment Thesis: A Buy at $0.95–$1.00, Target $1.80

Victory Metals is a pure-play bet on U.S. supply chain resilience. With SAM approval and EXIM financing as near-term catalysts, and a pre-feasibility study due in 2026, the stock is primed for a multi-year growth trajectory.

Entry Point: Accumulate at $0.95–$1.00 (near the 50-day moving average).
Target: $1.80 by early 2026, valuing VTM at ~$1.2 billion—a premium to peers like MP Materials (MP).
Exit Strategy: Monitor SAM approval timelines. If delayed beyond Q4 2025, reassess.

Conclusion

Victory Metals isn't just a mining play—it's a geopolitical play. In a world where critical minerals are the new oil, VTM's access to federal contracts, EXIM financing, and Saudi backing positions it as a non-Chinese supplier to the U.S. defense and EV industries. With SAM approval looming and EV demand surging, this is a stock poised to ride the critical minerals boom to new heights.

Investment Rating: Buy
Price Target: $1.80 (12–18 months)