Highland Copper progress wavers with low copper value
June 6, 2019
By P.J. GLISSON
Wakefield - Recent low copper prices appear to be slowing progress toward the long-anticipated resurgence of copper mining in Wakefield and Ironwood townships, according to a report during Tuesday evening's Wakefield Township board meeting.
As of the end of Tuesday afternoon, Wakefield Township supervisor John Cox said the price of copper was at $2.67 per pound. "They got to have $3.20 per pound to make money," he added.
Area residents had renewed their excitement about the prospect of new mining jobs ever since Canada's Highland Copper Company Inc. announced in 2014 that it would buy this region's Copperwood project from Orvana Resources U.S. Corp.
The Globe also reported a year ago, in June, that Highland Copper had released a feasibility study that had its president and CEO, Denis Miville-Deschenes, declaring that the projected Copperwood mine "represents a tremendous opportunity to create hundreds of jobs in the region."
At that time, construction had been anticipated by this year, with mining to follow in 2021.
Now, Cox has expected a Highland representative to give the township board an update during the past two meetings, but has resulted with nobody showing up.
Meanwhile, he said, the local Highland staff is dwindling, and the company has announced it entered into a $4.5 million loan with Greenstone Resources II LP and with Osisko Gold Royalties Ltd. The two companies are two of Highland's existing shareholders, according to the announcement.
"The company will be using the loan proceeds to settle its working capital deficiency, to initiate a scoping study on the White Pine project and for general corporate purposes," states a related Highland press release dated May 21. "The company also intends to appoint a financial advisor to start a strategic review process."
Highland did not indicate any intention to cease its interests in the western U.P.
Tim Lynott, manager of finance and administration in Wakefield's Highland office, said Wednesday that the loan is necessary "to keep the momentum going" until the price of copper improves.
"Global demand is outpacing supply," he said, adding therefore, that "there should be an upward presence on the price of copper."
Instead, he said, "global tension" is creating obstacles. "There's a trade war with China right now," he said, in addition to other issues with Korea and Iran.
A formal statement from Highland describes the Copperwood project as "the company's principal asset" and one that is "fully permitted to move into the construction stage."
Highland, however, concludes its formal statement with a "cautionary note" that its own "forward-looking statements" are contingent upon a list of factors, including "general economic conditions, commodity prices, risks" and "fluctuations in metal prices."
"I haven't gotten anything official from anyone," said Cox after Tuesday's meeting. He said he intends to make an outreach to the company CEO himself.
"The copper isn't going anywhere," continued Lynott Wednesday while standing in the Highland office that has been open for nearly two years on the corner of U.S. Hwy. 2 and Ascherman Avenue in Wakefield. "It's always going to be there."
Meanwhile, Lynott said, the recent reduction in his office staff is merely a means of "conserving resources," but added there are no plans to close the office.
Cox said he understands that the current, lower price of copper will have an effect on any progress.
Still, he concluded of the world's overall resources, "There's a finite amount of copper," and emphasized, "We've been working on this for 12 years."
Back in June of 2018, the Globe reported from a mining document that the projected Copperwood project has "proven and probable reserves of 25.4 million metric tons, containing 801.8 million pounds of copper and 3.1 million ounces of silver."
Additional "inferred" projections were noted as "49.9 million metric tons containing 1.3 billion pounds of copper and 5.5 million ounces of silver."
According to mineral experts, "inferred" implies a possible but not proven resource.
In other news, the board also:
-Voted to approve a charitable exemption policy that will require anyone desiring tax-exempt status to apply for it through a formal application process.
-Learned from Cox that efforts are being made to tackle the township's blight, with several citations planned for property owners with issues such as visible garbage or appliances, collapsed structures, multiple vehicles or mobile homes, etc.
-Voted to retire a Wakefield Township water system number in relation to Big Snow Resort's Indianhead Mountain water system and place it under a new number under the auspices of the Gogebic Range Water Authority.