West High Yield Resources (TSXV:WHY): A Critical Mineral Play Poised to Explode with Permit Progress and $0.26 Valuation

West High Yield Resources (TSXV:WHY) is positioned to deliver outsized returns as it advances its Record Ridge magnesium project—a world-class asset with a jaw-dropping 72% internal rate of return (IRR) and an $872 million net present value (NPV). With shares trading at just CAD$0.26—a stark discount to its pre-feasibility study metrics—the stock represents a rare opportunity to invest in a critical mineral play at a valuation floor. Let's dissect why this could be one of the year's top performers.

Magnesium: The Unsung Hero of the Green Energy Transition

Magnesium is the fourth-most traded metal globally, with demand expected to surge as EV batteries, renewable energy systems, and aerospace components rely heavily on its lightweight, high-strength properties. Unlike lithium or cobalt, 80% of global magnesium production is dominated by China and Russia, creating a strategic vulnerability for North American industries.

The Record Ridge deposit—boasting 10.6 million tonnes of contained magnesium—is one of the highest-grade, largest undeveloped deposits in North America. Its hydrometallurgical processing technology (HCI leaching) achieves zero waste and 94% ore recovery, making it a standout ESG play. This method slashes CO₂ emissions compared to traditional methods, aligning perfectly with the Biden administration's Critical Minerals Action Plan and Canada's green infrastructure priorities.

Pre-Feasibility Study Metrics: A Financial Home Run

The project's 2022 pre-feasibility study (PFS) is a blueprint for success:
- After-tax NPV at 5% discount rate: $872 million
- IRR: 72% over a 172-year mine life
- Payback period: 1.5 years
- Annual revenue: ~$130 million (at current magnesium prices)

These metrics are not theoretical. The deposit's 24.6% magnesium grade ensures low production costs, while byproduct recovery of silica, nickel, and iron adds to profitability. With global magnesium prices up 120% since 2020, the economics only improve.

Permitting Progress: Final Stretch Before Production

The project's environmental and regulatory path is nearing completion:
- British Columbia Environmental Assessment Office (EAO): On May 28, 2025, the EAO issued a Draft Minister's Designation Report, concluding the project's environmental impacts are manageable under existing regulations. This avoids a costly, time-consuming formal assessment.
- Vegetation Management Plan: Finalized to protect the Mountain Holly Fern and grassland ecosystems, addressing ecological concerns.
- Mining Permit: In its final technical review stage, with approval expected within months.

Once permitted, West High Yield can begin construction of a high-purity magnesium oxide (MgO) plant, targeting >99% purity for premium markets. Early discussions with offtake partners suggest strong demand, particularly for aerospace and battery-grade materials.

Community Partnerships: Social License is Secured

The Osoyoos Indian Band (OIB) has endorsed the project through a partnership agreement, ensuring local buy-in and minimizing regulatory delays. This collaboration includes direct community oversight of environmental practices and job creation—a rarity in resource projects.

Recent Capital Raising: Strengthening the Balance Sheet

• Warrant Exercises (June 2025): A single warrant holder exercised 50,000 warrants at $0.30, generating $15,000 in proceeds. This signals confidence in near-term upside.
• Private Placement (March 2025): Raised $1.07 million at $0.23 per unit to fund permitting and operational prep. Warrants attached to these units (exercisable at $0.35) expire in March 2026—a looming catalyst as the stock approaches that level.

Valuation: A 200%+ Upside at $0.26

At CAD$0.26, the market is pricing West High Yield at <10% of its PFS-derived NPV per share. Even a modest multiple expansion to $0.50/share (reflecting permit approval) would double the stock. With catalysts like:
1. Permit approval (Q3 2025)
2. Ofatum agreements announced (H2 2025)
3. Warrant expiration pressure ($0.35 strike)

The upside is asymmetric.

Risks and Mitigants

• Regulatory delays: The EAO's positive stance and final permit stage reduce this risk.
• Dilution from warrant exercises: Limited to ~50,000 shares at $0.30, which is negligible relative to the 172-year mine life.
• Commodity price volatility: Magnesium's industrial uses (construction, auto parts) provide a buffer against EV-specific demand swings.

Conclusion: Buy the Dip at $0.26—This is a 2025 “Moonshot” Play

West High Yield Resources is a once-in-a-decade critical mineral opportunity at a valuation that ignores its PFS-backed potential. With permits nearing completion, ESG credentials, and a strategic asset in a geopolitically vital sector, the stock is primed for a multi-bagger move.

Action Items for Investors:
- Buy the dips below $0.30 and hold for the permit catalyst.
- Exercise warrants before March 2026 if holding units.
- Monitor magnesium price trends as a leading indicator of project economics.

The green energy transition isn't waiting—neither should you.