Western Copper and Gold (TSX: WRN) has secured further financial support from Rio Tinto, who has invested a further $6.0 million to support the further development of Western’s flagship Casino project, which is found in the Yukon.
The investment, consisting of 3.5 million shares purchased at $1.73 per each, increases Rio Tinto’s ownership to 9.7%. As part of the arrangement, an investor rights agreement has been entered into that will see Rio retain the right to nominate one member to the Casino project’s technical and sustainability committee, to have a non-voting observer to attend all meetings of the board, and should its ownership increase to 12.5%, it will retain the right to nominate one director.
Rio Tinto also holds the right to maintain its ownership rate through future equity issuances.
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Western Copper’s Casino project is found 300 kilometres northwest of Whitehorse. It currently features a feasibility study, with proven and probable reserves of 5,079 million pounds of copper, 571.9 million pounds of molybdenum, and 8.5 million gold ounces within its mill ore reserves. Its heap leach reserves meanwhile amount to 165.3 million pounds of copper and 1.78 million ounces of gold in the proven and probable category. The feasibility study suggests an after-tax NPV(8%) of $2.3 billion, based on a 27 year mine life.
Proceeds from the investment by Rio Tinto is expected to be used to fund specific areas of study, with the aim of pushing the company through permitting to the development phase for Casino.
Western Copper and Gold last traded at $1.77 on the TSX.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
