Titan Mining Corporation (NYSEAMERICAN:TII; TSX:TI) experienced a significant premarket surge on Friday, with U.S.-listed shares climbing 41.71% to $3.16, following news that the U.S. Army has selected the company's Empire State Mines subsidiary for conditional enhanced-use lease (EUL) discussions. The lease negotiations pertain to graphite processing sites at the Pine Bluff Arsenal in Arkansas and the Anniston Army Depot in Alabama.
The premarket rally, which added approximately $91 million to Titan's equity value based on 98.29 million outstanding shares, reflects investor optimism about the company's strategic move into graphite processing. However, Titan cautioned that the lease may not proceed as planned, a standard risk acknowledgment for such government-related projects.
Titan's TSX-listed shares closed Thursday at C$3.11, up 4.36%, with a market capitalization of roughly C$305.68 million. The NYSE American, which opened for early trading at 7:00 a.m. ET, saw heavy volume, with 6.4 million shares traded by 7:03 a.m. ET. Thursday's total trading volume on the WSJ platform reached 15.9 million shares, far exceeding the 65-day average of 479,507.
The U.S. Army's decision to enter into conditional lease talks with Empire State Mines is a key milestone for Titan, which plans to establish the Kilbourne Graphite Purification Plant. This facility will produce purified micronized graphite and coated spherical purified graphite, materials critical for battery manufacturing and other high-tech applications. Empire State Mines will be responsible for designing, funding, constructing, and operating the plant, while the land will remain under U.S. Army ownership. The lease could extend up to 50 years, with construction potentially beginning in the second half of 2027.
CEO Rita Adiani emphasized the strategic importance of the project, stating that Titan has "resources in the ground" and is collaborating with the Army to advance downstream processing. She highlighted the goal of establishing a supply chain "entirely free from foreign control," a nod to growing concerns about graphite supply security amid global trade tensions.
The premarket valuation surge prices Titan at approximately 3.3 to 4.6 times its 2026 adjusted EBITDA target of $20 million to $28 million, a notable premium given that the lease is not yet finalized. In the first quarter of 2026, Titan generated $19.6 million in revenue from its primary zinc operations, producing 14.2 million payable pounds. Adjusted EBITDA for the quarter was $3.9 million.
Titan also reported that it has begun shipping initial graphite concentrate for customer testing. A feasibility study for a potential 40,000-tonne-per-annum graphite processing facility is underway and fully funded, underscoring the company's commitment to expanding its presence in the critical minerals sector.
Investors should note that forward-looking statements regarding the Army projects, financing, permits, construction, and operations are subject to risks. Titan cautioned that the enhanced-use lease plans could be altered or canceled entirely, a reminder of the uncertainties inherent in such large-scale government partnerships.
The broader market context is favorable for graphite-focused companies, as demand for battery materials continues to rise amid the global energy transition. Titan's move into graphite processing could position it as a key domestic supplier, aligning with U.S. efforts to reduce reliance on foreign sources for critical minerals.
