Coeur Scores a Supreme Victory

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Coeur d'Alene (NYSE: CDE), while bruised and bloodied, is looking better all the time.

Sure, the beleaguered silver miner has one of the ugliest 52-week charts in the space, lagging peers like Silver Standard (Nasdaq: SSRI), Silver Wheaton (NYSE: SLW), and Pan American Silver (Nasdaq: PAAS). But the story here keeps improving, and Coeur has markedly outperformed the other silver slingers of late. The most recent fortuitous event is a victory hammered out not in the mining camp, but in the courtroom.

Coeur's Kensington gold project sits roughly 45 miles north-northwest of Juneau, Alaska. While this property has been in the company portfolio since I was in kindergarten, Kensington has yet to become a mine. Coeur began construction in 2005, but a legal challenge brought by the Sierra Club and two other conservation groups has hamstrung development from that year to the present date.

The fight centers on Coeur's use of a local lake as a site to deposit several million tons of rock waste, known in the industry as tailings. When your deposit contains just a couple grams of gold per metric ton of ore, you've obviously got a great deal of left-over pulverized rock to deal with. Tailings are an unavoidable part of the mining process, and there are several disposal techniques, each with their respective pros and cons.

While the firm's disposal permit held up in District Court, the Ninth Circuit Court of Appeals was more sympathetic to the plaintiffs' claim that it violated the Clean Water Act. Coeur, in turn, took its case to the Supreme Court, which brings us to Monday's verdict.

By a 6-3 majority, the Court held that the permit is indeed lawful, and gave Coeur the golden thumbs-up. The miner's now gunning for gold production by the back half of 2010.

I don't follow Coeur nearly as closely as my colleague Chris Barker, who has documented each plot twist and turn. After surveying his past coverage (see the links below), you may just find that this latest golden "green light" sweetens the odds sufficiently enough to take a flyer on this precious metals miner. Compared to Goldcorp (NYSE: GG) or Yamana Gold (NYSE: AUY), this firm certainly appears to present a relatively underappreciated growth story. Access to attractive financing now becomes the central question, and one which I'll be eager to see Chris tackle in the future.

Related Foolishness:

• Coeur's bad news was near-heartbreaking in the fall.
• The firm's silver streak has quite an allure.
• Finally, there's the once and future 10-bagger to consider.