WAKEFIELD - It's been 12 years since the White Pine Mine closed its doors, effectively ending copper mining in the Upper Peninsula. But thanks to a deal between the Keweenaw Land Association and Orvana Minerals Corp., that industry could make a comeback over the next four years.
Orvana, a Toronto-based mining company with gold mining operations in eastern Bolivia, has entered a 20-year lease for mineral rights covering 771 acres about 19 miles southwest of the now-closed White Pine Mine. The intention is to excavate copper, said Malcolm King, Orvana vice president and chief financial officer.
"Copper is the objective," King said in a phone interview from his office in Toronto. "Copper continues to be strong (in value). All metals have come back, but copper continues with considerable strength. We think it certainly makes the project quite worthwhile."
However, due to regulations for permitting such a project, King said mining operations can't start immediately.
"Our initial intent is to do an environmental study, which takes a good two years to do," he said. "Following the two years, which we're going to try to start this autumn, we have to go through the permitting process for about a year and then we'll focus on facilities."
Initial investment would be about $50 million and the property is hoped to be under development by the end of the fourth year of the project, King said. The area is being referred to by Orvana as the Copperwood Project.
Bill Williams, the vice president of corporate development for Orvana, was visiting the area Thursday. He said the company is taking its time to ensure everything is done properly, which sometimes takes time.
"We're just hoping to do everything we need to do and hopefully have a mining permit from the state somewhere in year three or four," he said.
The project, if permitted, will mark Orvana's first in North America.
"We are excited to have the opportunity to develop a copper deposit in this part of the world," Carlos Mirabal, Orvana's president and chief executive officer, said in a prepared statement. "The Upper Peninsula has had a long history of copper production, dating back to the American Civil War era. The Copperwood Project is situated in an historic mining area with excellent infrastructure."
Mirabal said it is an important step in the diversification of Orvana, which is currently pursuing other development opportunities on the continent.
The former White Pine Mine produced over 1.7 million tons of copper between 1952 and 1996, when it was closed.
The lease between Orvana and Keweenaw Land Association - an Ironwood-based timber, land and minerals company - is for mineral rights, KLA Controller/Treasurer Robert Davenport said. He said KLA does not have surface rights to the land.
"In the latter part of 2006, we put out a letter of information to about 70 or 80 mineral mining companies just to enhance their interest in the minerals that lie under Keweenaw land," Davenport said. "We did make some contacts from those letters, including Orvana in mid- to late-2007."
In addition to the 771 acres being leased, KLA officials said the company has extended an exclusive option to Orvana to lease mineral rights on 2,382 acres in the general area of the current mining lease.
Surface rights are being acquired in a location more than a mile away from any occupied pieces of private land, King said.
"The planned ramp into the mine will be at least one or two miles from the vacation homes and the cabins there," King said. "We have obtained surface rights and the lease rights."
The exact location of the mine has yet to be determined, but it is expected to be somewhere in the vicinity of the town of Wakefield in Gogebic County, Williams told Houghton's Daily Mining Gazette.
No production amount or employee numbers have been considered yet, Williams said. He indicated that there would be contractors hired fairly soon to help with environmental studies related to water and other resources to prepare for the permitting process.
"We have a lot of work to do," said Williams. "Our main concern right now is to make sure we achieve the goal of making a mine here with absolute minimum impact."