Japanese giant takes shine to Huckleberry

Development of the Huckleberry open-pit copper project in northern British Columbia is getting a helping hand from Mitsubishi Materials.

Operator Princeton Mining (TSE) reached an agreement with the Japan-based corporation, according to which the latter will buy concentrate produced from Huckleberry, with competitive, fixed terms for the first five years; arrange a US$60-million, fixed-term loan for development; and acquire between 25% and 40% of the project at a price that reflects Princeton’s cost, as well as fund its proportionate share of the required funding.

These terms are subject to the completion of a final feasibility study by both parties.

Huckleberry is owned by New Canamin Resources (VSE), which is the focus of a proposed merger with Princeton. The amalgamation was approved earlier this year by the boards of directors, although New Canamin’s shareholders have yet to sanction it. They are expected to do so at an as-yet-unscheduled meeting. The amalgamation would see shareholders of New Canamin receive 1.25 shares of Princeton for every single share held, as well as one share purchase warrant. The warrant is exercisable at $1.05 per Princeton share for up to one year, and at $1.15 during the second year.

According to a feasibility study by Kilborn Engineering Pacific, the East and Main zones contain minable reserves of 91 million tonnes grading 0.517% copper and 0.014% molybdenum, as well as 0.064 gram gold and 2.78 grams silver per tonne. The initial stripping ratio is estimated at 1.23-to-1. The capital cost of developing a 13,500-tonne-per-day operation with an 18-year life is estimated at $135 million.

Princeton is expected to apply for a mine development certificate in the next few weeks.