Copperwood Feasibility Study: $168M NPV, 18% IRR
Highland Copper Company Inc.'s Copperwood in Michigan, USA (Upper Peninsula) has a Feasibility Study outlining an after-tax NPV of $168M, an after-tax IRR of 18%, and initial capital of $391M. The mine plan runs 11 years at about 30 ktpa Cu per year.
Highland Copper Company Inc.'s Copperwood has reported Feasibility Study results for the copper project in Michigan, USA (Upper Peninsula). The study headlines an after-tax net present value of $168M at a 8% discount rate. It reflects Highland Copper Company Inc.'s (HI.V) latest disclosed economics for the asset.
Economics. The after-tax NPV is $168M using a 8% discount rate. After-tax IRR is 18%. Initial capital expenditure is estimated at $391M. The study models a payback period of 3.5 years. All-in sustaining costs are pegged at 1.99 USD/lb. Economics are based on Base case copper price $4.00/lb and $5.00/lb; silver price $25/oz.
Production and mine plan. The project envisions an underground (ramp-accessed room-and-pillar) operation. Life of mine is 11 years. Average annual production is approximately 30 ktpa Cu. Metallurgical recovery averages 87.6%.
Resources and ownership. The company holds a 100% interest in the project. Royalties and streams: Sliding scale 5.5% NSR royalty to leaseholders (resources); reserves: sliding 4.0% NSR royalty to leaseholders, 1.5% NSR royalty to Osisko Gold Royalties, additional 11.5% silver mineral royalty to Osisko Stream Royalties.
These figures are extracted from Highland Copper Company Inc.'s technical disclosures and reflect the most recent Feasibility Study on file. Compare this project against other developers and producers in our project economics database, and always verify the numbers against the original technical report before making any investment decision.
Reserves & Resources
| Category | Tonnage | Grade | Contained |
|---|---|---|---|
| Proven | 18.2 Mt | 1.49% Cu, 4.47 g/t Ag | 597 M lbs Cu, 2.6 M oz Ag |
| Probable | 7.5 Mt | 1.34% Cu, 2.56 g/t Ag | 222 M lbs Cu, 0.6 M oz Ag |
| Proven & Probable | 25.7 Mt | 1.45% Cu, 3.91 g/t Ag | 820 M lbs Cu, 3.2 M oz Ag |
| Category | Tonnage | Grade | Contained |
|---|---|---|---|
| Measured | 27.9 M (LCBS) + 0.1 M (UCBS) = 28.0 Mt | — | — |
| Indicated | 16.1 M (LCBS) + 10.1 M (UCBS) = 26.2 Mt | — | — |
| Measured & Indicated | 54.2 Mt | 1.51% Cu | 1.8 Billion Pounds (M&I) |
| Inferred | 79.1 Mt | 1.09% Cu | 1.9 Billion Pounds (Inferred) |
Our Analysis
- IRR after-tax
- 18%
higher than 37% of 27 projects we track
- NPV after-tax
- $168M
higher than 17% of 36 projects we track
- Initial capex
- $391M
233% of NPV
costlier than 33% of 39 projects we track
- Payback
- 3.5yrs
slower than 33% of 27 projects we track
- Mine life
- 11yrs
- Discount rate
- 8%
- Study price assumption
- Base case copper price $4.00/lb and $5.00/lb; silver price $25/oz
- Spot copper today
- $6.59/lb
The financing question is not academic here; it is the whole ballgame. With initial capex of $391M standing at roughly 4.3x the company’s entire US$92M market cap, this is not a build that can be quietly funded from cash flow or a modest equity raise. The cheque is simply too large for a micro-cap with this being its only tracked project. Realistically, funding means either a substantial dilution event for existing holders or bringing in a strategic partner willing to write a cheque several times the company’s current value. The 18% after-tax IRR, which ranks in the lower half of the 27 copper projects we track, does little to lower that hurdle: a junior with no other portfolio assets typically needs 20%+ to attract project finance, so this sits below the level where lenders and investors will be lining up.
The economics are workable but not exceptional. The after-tax NPV of $168M is about 1.8x the market cap, which cuts two ways: it suggests the market has not priced in a successful build, but it also reflects skepticism about whether a company this size can execute a capital-intensive project where capex is 233% of NPV. The 3.5-year payback is moderate, and the 11-year mine life is short enough that any cost overrun or delay would compress returns quickly. At feasibility-study level, these numbers carry real weight, but they are built on a base-case copper price of $4.00/lb, well below today’s $6.59/lb spot, which provides genuine upside if prices hold. The Michigan, USA jurisdiction is a quality signal, reducing political risk in an otherwise tight financing picture.
The single question that decides whether this works is simple: who writes the $391M cheque, and what do they demand in return? If a strategic partner or lender steps in on reasonable terms, the gap between NPV and market cap could close. If the funding requires heavy dilution at a US$92M valuation, existing holders will bear the cost of the build long before the copper is mined. That trade-off, not the IRR, is the investment.
Our take, benchmarked against the project economics in the Mining Stocks database. Figures are estimates drawn from company technical reports — not investment advice; always verify against the source filing.