Serving Gogebic, Iron and Ontonagon Counties
Serving Gogebic, Iron and Ontonagon Counties
By P.J. GLISSON
The global status of copper mining, as well as its future potential, was the subject of a virtual session last week that included the man who for six years has led Highland Copper Company Inc., a Canadian-based enterprise with interests in Wakefield Township and the broader Copper Country.
Titled “The Doctor Is In,” the Jan. 20 session included five participants with worldwide expertise in business and finance, digital information, geology and mining engineering.
Lobo Tiggre, founder and CEO of Louis James LLC in Puerto Rico and a principal analyst and editor of IndependentSpeculator.com, served as moderator.
Among panel members was Denis Miville-Deschênes, the director, president and CEO of Highland Copper since February 2017. He is a mining engineer with more than 30 years of experience in the design, development and construction of mines.
Other participants included the following: Jamie Levy, president and CEO of Generation Mining, based in Toronto, Canada; Ali Haji, president and CEO of Aranjin Resources Limited, also in Toronto; and John E. Black, CEO and director of Regulus Resources and Aldebaran Resources, both in Vancouver, Canada.
Tiggre directed the session by posing questions and then allowing each participant to share his views.
Among the concerns he expressed was the potential for an acknowledged recession and how that might affect the price of copper.
“There is concern about a recession in the short term, but I think most miners are looking through that,” said Black, who expects “a soft landing.”
“I don’t welcome a recession,” said Levy but added that it “shouldn’t hurt any of us who are producers.”
Haji reminded that the need for electricity also affects copper, and Tiggre suggested that “we’re going to need a lot more copper” because “the ESG drive is not going away.”
ESG refers to the cultural and investor push for Environmental, Social, and Governance issues.
Levy said that he does not believe related mandates from the United States, Canada and Europe are realistic in pushing compliance by 2025 or 2020, but he added that they nevertheless suggest a real need for copper.
“The genie is really out of the bottle,” said Black, who predicted that it will be difficult to reverse trends. “We’re seeing electrification of mines now.”
Moreover, he said demand is growing from developing countries as well. Levy added that China buys 40-50% of newly mined copper, and India soon will surpass China in population.
“China’s going to remain a large consumer,” said Miville-Deschênes. “I like India in the background.”
Haji also noted that, in recent years, the market has grown, not just for major electric cars such as Tesla, but also for non-luxury brands such as Hyundai.
Overall, Black’s optimism went far enough for him to conclude that, even if there is a pullback in copper prices this year, “pay attention to that” as “an opportunity to load up.”
Tiggre also asked panel members their opinions on the viability of lower-grade copper projects.
“Higher-grade ore is the ideal,” said Levy, who also acknowledged that copper growth has been lower than other types of mining in the past decade. He’d like to see investors fund exploration in top-grade exploration.
Tiggre noted that 30-40 year projects can vary in value over time. He added that, even as copper prices rise, so do costs. He speculated that, the lower the grade of copper, the bigger the project has to be in order for it to work.
Miville-Deschênes said that it could be tougher on a lower-grade project to get a financial return. Moreover, he said larger projects come with larger costs.
Black — whose 3-decade history in the business includes work in South America, Europe and various locations in Asia — believes that investors are willing to consider lower-grade projects at an existing mine that already has earned its projected capital.
He said new technology will allow new mines “to be processed more economically” and predicted that the world will use as much copper in near future as has been used in all of history.
Nevertheless, he conceded, “You need to have a deposit that’s acceptable to all the stakeholders to move forward.” He said miners should seek “communities where we’re welcome” and whose residents see mining “as an important economic driver.”
“Economic viability is always something that’s considered,” said Haji. “So long as you have the price support, technology will back that up.”
The men also discussed environmental concerns as they relate to mining.
On one hand, said Tiggre of the modern world, “It’s nothing like the hydraulic mining days of destroying the countryside” or miners dumping waste in lakes.
On the other hand, Miville-Deschênes said there is room for continuing improvement. “As an industry I think we need to do better,” he said.
“We’re getting great support from the local communities,” he added, but suggested that better education is needed overall to show industry benefits.
Haji suggested that mining interests should install a community liaison officer before even starting a project.
Tiggre ultimately wondered whether the men’s companies have enough cash to hold out in the near term “no matter what.”
“We’re in good shape this year and moving forward,” said Black.
Levy, who has 25 years of experience with Canadian mining companies, said his company has enough money for current objectives and added that it helps that gold mines are seeking diverse investments that include copper mines.
Haji — whose 15 years of experience include work in Mongolia — said more money in the bank would be the preferred insurance for “a long vision.”
“We will need money to increase the amount of activity at both sites,” said Miville-Deschênes of his commitments at White Pine North and at Wakefield Township’s Copperwood project.
On Jan. 19, Highland issued a press release to announce that it is initiating an infill drill program at White Pine North.
“We are excited to be back drilling in Michigan as we believe we still have tremendous value to surface from Highland’s key business assets, the Copperwood and White Pine North projects,” stated Miville-Deschênes in the release.
The report adds that a winter drilling program is now underway with “the goal of upgrading a portion of the Inferred resources into the Measured and Indicated category. This would increase the usable resource base and mine life for future Feasibility Studies. The initial phase of the program consists of eight holes representing approximately 8,400 meters of core drilling.”
The company notes that weather conditions will dictate, in part, the timing of the program.
“Work is also ongoing on our key technical studies,” continues the press release. “The Preliminary Economic Assessment on the combined scenario is progressing well. The PEA will contemplate eliminating considerable infrastructure at Copperwood, particularly the processing plant and tailings storage facilities as defined in the previous stand-alone Copperwood Feasibility Study3. In its place, the PEA will consider processing ore from the two deposits in one central facility located at White Pine North. We expect to issue the results of the combined scenario PEA late in Q1 2023.”
“We are drilling the extension of the historic White Pine mine which had a long history of successful conversion of inferred ore,” stated Miville-Deschênes. “Similarly, we hope to convert a significant portion of our 97 million inferred resource tonnes. We look forward to providing updates throughout the program.”
The press release continues, “The significant capital investment demonstrates Highland’s commitment to advancing its assets including the Copperwood project, which has received all required Michigan state permits, and the White Pine North Project, a proven past producer.”
It also notes that “Copperwood and White Pine North both have significant contained copper resources totaling 4.8 billion pounds in the Measured and Indicated category (182.7 million tonnes at 1.20%. copper grade)1, and 3.5 billion pounds in the Inferred category (148.7 million tonnes at 1.08% copper grade).”
During the forum, Miville-Deschênes answered the moderator’s question about financial holdings by saying that Highland — which is based in Longueuil, Quebec — tries to maintain at least 18 months of funding.
Regarding the hope for a continued rise in copper prices, he also noted the following consideration for mining companies: “As we see copper prices going up, communities will want a larger cut of the price,” he said.
For details on the local work, see highlandcopper.com.
