Sept 5 (Reuters) - Perpetua Resources ( PPTA ) said on

Thursday it expects the U.S. government to approve its antimony

and gold project in northern Idaho by the end of the year, news

that sent the company's stock up more than 12%.

Support for the mine, backed by hedge fund manager

John Paulson

, comes as part of Washington's evolving strategy to offset

China's critical minerals sector dominance after Beijing last

month imposed

export restrictions

on antimony, a metal used to make weaponry, solar panels,

flame retardants and other goods for which there are no current

U.S. resources.

The U.S. Forest Service plans to release the final

environmental impact statement for Perpetua's Stibnite mine on

Friday alongside a draft record of decision. The final record of

decision - essentially the mine's permit - is expected to be

issued by the end of December, the company and government agency

said in separate releases.

The permitting news comes after Perpetua in April

received a letter of interest from the U.S. Export-Import Bank,

the government's export credit agency, for a loan worth up to

$1.8 billion to fund the Stibnite project.

The project was forecast in 2020 to cost $1.3 billion, a

number expected to rise due to post-pandemic inflation.

The Pentagon has already committed nearly $60 million to

fund permitting for the project, which would entail cleaning and

expanding a site that was polluted by World War Two-era mining.

The site has estimated reserves of 148 million pounds of

antimony.

The deposit also contains an estimated 6 million ounces

of gold. While gold is not a critical mineral, its production is

seen as helping to financially buttress the mine's antimony

production and ensure a domestic supply of the metal for the

Pentagon.

Concerns have grown that China could try to harm the

Perpetua mine's prospects by

ramping up its own production

of antimony in a bid to gain global market share, something

Chinese-linked producers of nickel, cobalt and other critical

minerals have systematically done in recent years.

The project is "a win for Idaho, it's a win for the

environment, and it's a win for America's national security,"

said Jon Cherry, who became Perpetua's CEO earlier this year.

The project has not yet won the support of Idaho's Nez

Perce tribe, which is concerned the mine could affect the

state's salmon population. The company and the tribe, however,

have started discussing water restoration projects.