First off, no doubt that was a big gain yesterday: up 10% on big volume, so there were obviously investors who wanted in and existing shareholders got a big bump in the market value on their investment. When a company like TLG is at this stage of its life (pre-FS), you can indeed have big swings upward, especially if the underlying metals (gold and copper) are experiencing big runs and excitement about these two products is runnning high. Thus, this seems to be a goldilocks period for TLG.
That said, when the FS is released, the rubber hits the road as the investment community discovers the estimate of how much it's going to cost to get this mine to first pour (initial capex) along with other particulars (proven and probable reserves, strip ratio, Internal Rate of Return, NPV, etc.). Don't forget, we're still in an higher interest rate and inflationary environment, so the FS should take these factors into account when estimating the total cost of the mine build. The FS is followed by the financing components (usually a combination of equity raises, debt financing, streaming and/or offtake agreements, and in TLG's case, almost certainly a JV agreement as IMO there's no way they'll be able to come up with anywhere close to $1B+ in up front financing on their own) and, more specifically, the terms of those financing components.
In conjunction with the financing, the focus also shifts to the terms of the deals TLG enters into with the contractors, equipment rentals, labour, suppliers of the mine building materials, etc., and progress in the Federal permitting process (I agree the provincial permitting should be easy), all of wich need to be completed before they even start building the actual mine. I don't think TLG will be able to get away with dellays during this time period, and if the initial capex was underestimated in the FS, addition financing my be required, both of which are obviously seen as negatives. Further, while existing producers are certainly able to take advantage of the current gold price, I suspect they'll be a point when TLG investors take a look at how much the project will cost up front coupled with when first pour is estimated to take place (my hunch is at some point in 2026) and realize that TLG will be unable to cash in on the price of gold or copper until that happens, they may come to the conclusion that TLG shares at this point in the game may be overpriced.
Finally, with regard to the likely JV agreement itself. I agree Sumitomo would appear to be the odds on favourite to be TLG's partner. Sumitomo is an enormous organization and thus have a lot of leverage as they are the ones with the cash to get TLG's project off the ground. TLG's advantage is they are adjacent to Sumitomo's Frotet project, which would make their claims desireable to Sumi. That said, do any current TLG investors know how Sumitomo acquired the Frotet project? The Frotect project's land package was originally staked by a company called Kenorland Minerals (KLD). KLD subsequently entered into a JV agreement with Sumitomo in which Sumitomo obtained 65% ownership of the project to KLD's 35%, with the option for Sumitomo to increase its stake in the project to 80% by providing additional funding, which Sumi subseqently did, upping their ownership stake to 80%. Then, in January of this year, KLD cut another deal with Sumi to trade their remaining 20% J interest in Frotet in exchange for a 4.0% net smelter return royalty on all minerals extracted from the Project. The transaction resulted in Sumitomo obtaining 100% ownership of the Project.
Now, I think it's unlikely that a potential Sumi / TLG JV agreement will turn out the same way, but Sumitomo, like any other potential partner, will try to extract a deal on as favourable terms as they can, just like TLG's management will. Thus my previous comments that the financing / contracting / permitting process is not a walk in the park and the investment community (especially those instutitions that currently own TLG shares) will be watching. Thus my strategy of waiting until the latter stages of this pre-construction process before making a decision as to whether I want to put up a sizeable chunk of cash into TLG shares.