Photo by Whitehorse Star
Photo by Whitehorse Star
One of the largest mining companies in the world has invested $25.6 million in the Casino project owned by the Western Copper and Gold Corp.
The investment was announced last week by Paul West-Sells, president and CEO of Western Copper and Gold.
“We are pleased to welcome Rio Tinto as a strategic investor in the company,” West-Sells said in a press release.
“The investment by Rio Tinto, a leading global mining group which operates in 35 countries around the world, and whose purpose is to produce the materials essential to human progress is a strong endorsement of the Casino Project. We look forward to working with Rio Tinto to advance Casino.”
In an interview with the Star last week, the company president said the investment is not your typical investment.
It is largely to allow Rio Tinto to get a better understanding of the potential of the copper-gold deposit and the overall project, he explained.
West-Sells said some of the money will go into additional drill holes where Rio Tinto might want to confirm information about the deposit.
But the money is geared to funding Rio Tinto’s understanding of the Casino project by laying out all the information they have, such as the engineering to manage the tailings, he said.
West-Sells said the agreement calls for completion of the work in 18 months, with an option to extend the timeline by an additional 12 months.
“Casino is a world-class project and now we have a world-class investor working with us,” he said.
With the investment, Rio Tinto will own eight per cent of Western’s outstanding shares.
The investor agreement provides Rio Tinto with the rights to appoint one member to the Casino technical team and one non-voting observer to attend all meetings of Casino’s board of directors.
If Rio Tinto ups its ownership share to 12.5 per cent, it would have the right to appoint one director of the company, says the agreement.
The Casino property is located along the Yukon River, between Carmacks and Dawson City.
Western Copper spent about $4.5 million drilling the property last year with 30 to 40 employees on site, West-Sells said, adding this year’s program will be similar.
The company estimated several years ago that it would take a $2.5-billion investment to bring Casino into production.
West-Sells said Western Copper will use the proceeds for specific areas of study that will inform the company’s feasibility study, which he hopes to wrap up by the end of the year.
The Casino project has been submitted for review by the Yukon Environmental and Socio-economic Assessment Board.
The board has elevated the project to a full panel review, the first by the board since it was created in 2003.
West-Sells said the feasibility study will form part of the Environmental and Socio-economic Statement they plan to file with the board next year.
Bringing the Casino project into production would provide an economic boost for the territory for 50 years, he said.
The company has estimated it would mill 120,000 tonnes per day, making it the largest mine in the Yukon’s history.
By comparison, when the Faro mine was in production from 1969 to 1998, with a four-year break, it was milling 13,000 tonnes per day at its peak.
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