Mitsubishi to invest in Western Copper

Western Copper and Gold Corp. March 24 announced a C$21.3 million (US$15.6 million) investment from Mitsubishi Materials Corp. to help advance the company's Casino copper-gold project in Canada's Yukon.

Located about 300 kilometers (186 miles) northwest of Whitehorse, this world-class project that Western Copper and Gold has been advancing since acquiring the property in 2008 is found within the traditional territory of the Selkirk First Nation.

Historically, two prefeasibility studies and a feasibility study on developing a mine at Casino have been published. Western Copper and Gold, however, has substantially expanded the deposit and published a preliminary economic assessment last year outlining an economically robust mine capable of producing an average of 178 million pounds of copper, 231,000 ounces of gold, 1.36 million oz of silver, and 16.6 million lb of molybdenum per year over an initial 25-year mine life.

This PEA is based on 2.03 billion metric tons of indicated resource averaging 0.14% (6.58 billion pounds) copper, 0.17 grams per metric ton (12.1 million ounces) gold, 1.4 g/t (100.5 million oz) silver, and 0.016% (731 million lb) molybdenum; plus 1.46 billion metric tons of inferred resource averaging 0.1% (3.28 million lbs) copper, 0.14 g/t (6.6 million oz) gold, 1.2 g/t (55.2 million oz) silver, and 0.01% (322.8 million lb) molybdenum.

Seeing the substantial potential of this world-class project, Mitsubishi Materials has agreed to acquire approximately 5% of Western's issued and outstanding shares at C$2.63 per share.

"We are pleased to welcome Mitsubishi Materials as a strategic investor in the company," said Western Copper and Gold President and CEO Paul West-Sells. "The investment by Mitsubishi Materials is a strong endorsement of the Casino project. We look forward to working with Mitsubishi Materials to advance Casino."

At the end of May 2021, Western Copper and Gold made a similar announcement for a C$25.6 million investment from Rio Tinto. Acquiring 11.8 million common shares at C$2.17 per share, Rio Tinto now holds roughly 8% of Western's outstanding shares.

Due to this, the exact number of shares to be issued by Western Copper at the time of Mitsubishi's investment will depend on whether Rio Tinto elects to exercise its right to participate on a pro-rata basis in equity financings by the company to maintain its current ownership interest.

Assuming Rio Tinto chooses to apply its participation right in full, then the total shares are expected to be just over 8 million, with nearly a million being issued to Rio Tinto.

Moving forward, Mitsubishi Materials will also have a right to participate in future equity issuances to maintain its ownership in Western Copper and, in the event its ownership increases to 8%, will be provided with a one-time "demand registration right" and "piggy-back registration rights."

The closing of the strategic investment is expected to occur around the time of April 14 and is subject to standard regulatory approval.