CENTENNIAL, Colo. - NioCorp Developments Ltd. (NASDAQ:NB) announced that Nebraska has enacted legislation providing approximately $200 million in state tax benefits over 10 years for the company's Elk Creek Project, according to a press release statement. The development-stage company, with a market capitalization of $1.69 billion, has delivered a remarkable 102% return over the past year despite not yet achieving profitability.
Governor Jim Pillen signed the legislation into law on April 16, following its passage by the Nebraska legislature on April 10. The tax incentives are contingent upon NioCorp meeting employment and investment requirements under the state's Tier 6 Nebraska Advantage Act program.
The legislation extends the timeframe for companies to meet the program's job creation and investment requirements. NioCorp stated it expects to create approximately 450 permanent jobs and invest hundreds of millions of dollars in Nebraska.
The Elk Creek Project is planned to produce niobium, scandium, and titanium, with the company evaluating potential rare earth production. NioCorp estimates the project will generate $6.59 billion in operating expenses over its lifetime and produce hundreds of millions in new state and local tax revenue.
"Nebraska has stood behind the Elk Creek Project from the very beginning, and this is another clear demonstration of that commitment," said Mark A. Smith, Chairman and CEO of NioCorp.
The company maintains a solid financial position as it advances the project, with an InvestingPro analysis showing NioCorp holds more cash than debt on its balance sheet and carries a low debt-to-equity ratio of just 0.11. According to InvestingPro's Fair Value analysis, the stock appears undervalued at current levels, with additional insights available through 9 more ProTips for investors.
Senator Bob Hallstrom of Syracuse sponsored the provision, while Senator Brad von Gillern, Chairman of the Nebraska Unicameral's Revenue Committee, supported the measure. The bill included various tax incentives for businesses and projects across the state.
NioCorp stated the project is expected to support an estimated 2,100 additional jobs throughout the broader Nebraska economy beyond the direct employment.
The company is developing the Elk Creek Project in southeast Nebraska as part of its critical minerals development operations.
In other recent news, NioCorp Developments Ltd. announced the completion of a $100 million public offering, selling 20 million common shares and pre-funded warrants at $5.00 per share. This move is expected to provide significant capital for the company's ongoing projects. Additionally, NioCorp has begun construction on the main access portal for its Elk Creek Critical Minerals Project in Nebraska, a $44.6 million initiative aimed at facilitating ore transport from the underground mine to the surface production plant. The company has also signed a non-binding agreement with Traxys North America LLC for a long-term marketing and offtake arrangement for its critical minerals. This deal positions Traxys as the exclusive global marketing partner for a range of products over the first 10 years of operation, pending a definitive contract. In light of these developments, H.C. Wainwright adjusted its price target for NioCorp to $10.00 from $11.25 while maintaining a Buy rating.