South32 to Sell Down Trilogy Stake to Defense Department in Latest U.S. Mine-Stake Deal

By Rhiannon Hoyle

South32 has agreed to sell roughly $17.8 million of stock in Trilogy Metals to the Defense Department as part of a deal for the U.S. to take a 10% stake in the Canadian mineral-exploration company.

Australia-based South32 and Canada's Trilogy jointly own the Ambler Metals project in northwest Alaska, which includes deposits of copper, zinc, silver and other metals. South32 also owns a roughly 11% stake in Trilogy. Shares in Trilogy doubled in after-hours trading Monday after Secretary of the Interior Doug Burgum said the U.S. would take a $35.6 million stake in the company.

The metals in the Ambler deposits are critical for energy infrastructure, modern technology and American national security, South32 said in a statement. "We see great value in the U.S. government's intention to develop the Ambler Mining District," said Graham Kerr, South32's chief executive.

Under the agreement, South32 will sell roughly 8.2 million shares in Trilogy, reducing its stake to about 10.4 million shares, or 6.3%.

It will also issue a call option for the Defense Department to buy more shares in Trilogy from South32 once a controversial 211-mile access road to the minerals-rich Ambler region is built.

A proposed road to the remote area was last year rejected by the Biden administration, which raised concerns about the negative impact on indigenous communities, wildlife and the environment. On Monday, President Trump reversed that decision, saying there is no economically feasible alternative route.

South32's 50% stake in the Ambler Metals joint venture isn't affected by the deal.

Trump wants to boost mineral production in the U.S. to reduce reliance on imports, especially from China. U.S. officials have pledged to accelerate permitting while acquiring stakes in several miners.

In an interview in August, Kerr praised the Trump administration's efforts to revive American mining, although he cautioned officials against rushing plans to open up the minerals-rich Ambler district in a way that could alienate local and indigenous communities.

Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com

(END) Dow Jones Newswires

October 06, 2025 21:19 ET (01:19 GMT)