LANSING, Mich. — A large hurdle was cleared by a Canadian company that is working to develop a copper mine in Gogebic County. On Tuesday, a unanimous vote from a state funding board secured $50 million for its Copperwood Mine project.
The grant funding will allow for a broad range of infrastructure upgrades for the area, enabling a bolstering of the power grid, roads, and internet capacities. The total cost of developing the mine is expected to fall just short of $400 million, according to Highland Copper’s summary of the project. s
Geographically, the Copperwood Mine project is located west of Porcupine Mountains Wilderness State Park and just miles from the shore of Lake Superior. With geological interest in the area dating back to at least the 1950s, interest was renewed in 2008 and Highland Copper’s involvement began in 2017.
Once the mine is operational, Highland Copper estimates that roughly 380 jobs will be created on-site , and that an additional 313 indirect jobs will be created throughout the state. The company has indicated that pay for those jobs will range from $80,000 to $120,000.
The company is also projecting that its operations will generate $12 million in local, county and state taxes annually.
Tuesday’s affirmative vote comes after a nearly two-month delay from the moment when the Copperwood proposal was first heard by the MSF board, where it is reported that some members raised questions about the project’s viability.
One result of the delay came in the form of a set of conditions for the money. Cindy Warner, chair of the MSF’s Policy and Planning Subcommittee, detailed the ways in which the terms of the agreement had changed since the grant was first proposed.
“The term sheet now reads that the company now has to go out and get funding before it gets a dime from the state. In addition, for clarification, the $50 million that has been referred to is for infrastructure improvements and we wanted to make sure that was well called-out and delineated.”
Warner also stated that those funds will be reimbursed, not allocated up-front.
“The changes that were made substantially improve this organization’s ability to prove that it not only has the financial standing, but also that they are only getting reimbursed for activities that will benefit this region for decades to come,” said Warner.
According to the proposal, Highland Copper would have to secure $150 million in funding by the end of 2025.
Highland Copper’s own staff reportedly also have concerns about Highland Copper’s ability to fund the lion’s share of the project. In 2023, a financial statement was published at the end of the year stating that Highland Copper is “subject to a number of risks and uncertainties associated with its future exploration and development activities.”
The financial statement furthered states that the company has yet made to post a profit, sporting a $43 million deficit and holding $21 million of working capital at the end of last year. The author indicated that this would mean that Highland Copper requires some form of outside investment to continue its operations, and while this hasn’t proven problematic it in the past, “if management is unable to obtain adequate funding, the Company may be unable to continue its operations.”
The proposed copper mine, if created, would be a below-ground operation with above-ground processing and waste storage facilities, occupying 505 acres.
The plan for the proposed Copperwood Mine is based on being operational for 11 years and extracting 54 million ore tonnes, estimated to be about 1.51% copper. Highland Copper has also indicated that it is exploring the option of extending the life of the mine with a view to extracting what is believed to be another 79 million ore tonnes of copper that is roughly 1.09% pure.
Highland Copper is further planning to create an offsite wetland preservation area that would cover over 700 acres.
A dozen local municipalities passed resolutions supporting the grant, including Wakefield Township and Gogebic County both of which have the project within their boundaries.
Prior to the board’s vote, Wakefield Township Supervisor Mandy Lake welcomed the prospect of making it easier for children in the community to stay in the community, once they are able to find good jobs close to home.
“We’ve lost so many people because if they wanted a good job, they had to leave.”
Willie DuPont, the Ontonagon Village Manager was in agreement, saying
“I’ve seen nothing but young people leaving.”
Despite this, several community members and concerned citizens voiced opposition to the grant.
Jeff Plumber, a longtime U.P. resident said
“…this is really an ‘all-risk no-reward situation’ in the long run, and I really can’t believe anyone would risk this amazing area which is vital to both Michigan’s ecological and environmental health, to enrich a foreign company with our Michigan taxpayer money… The unsustainable boom-and-bust nature of mining might bring very short-term economic gain, but it will surely leave the western U.P. with a legacy of pollution and ecological destruction.”
Ben Seguin, a retired federal employee and environmentalist, decried the economic benefit of the mines, saying
“…if mining is so great for the U.P., then why is the economy in the U.P. in such dire straits? There has been mining in the U.P. for centuries… The mines come and go, and leave toxic waste, economic depression… why give corporate welfare to a foreign company, to the tune of $50 million for a project that will come and go, and leave the U. P. worse off than it is now?”
After the MSF approved the grant, Highland Copper CEO Barry O’Shea said he listened respectfully to all public comments shared.
“We understand with this grant comes significant responsibility to the local environment and the local community, and we take that very seriously.”
O’Shea responded to criticisms regarding the project’s potential ecological threat to the nearby state park and Lake Superior.
“I want to say that mining has existed with tourism for decades… Copperwood is an underground mine which minimizes surface impact, and I want to be very clear that this is not an acid-generating mine… we listened to community concerns in 2023 and will not be drawing water from Lake Superior.”
Some preparation of the land has already begun, including the diversion of two streams. O’Shea indicated that his company’s goal is to begin construction on the facilities in the spring of 2025 and for the mine to become operational in 2-3 years.
— with files from upmatters.com
