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Western Copper & Gold (WRN) - More Aggressive Plan Attracts Investors

February 16 2021, 14:26 GMT

Western Copper & Gold Corp.

  • NYSE, TSX: WRN
  • Shares Outstanding: 135.6M
  • Share price C$1.77(11.02.2021)
  • Market Cap: C$240M

Western Copper & Gold Corporation are focused on developing the Casino project, Canada’s premier copper-gold project. In July 2020, Western Copper & Gold updated the resource estimate at the Casino deposit based on its 2019 drilling results. The updated estimate includes 14.5Moz of gold in the Measured & Indicated (M&I) category and 6.6Moz of gold in the inferred category in addition to 7.6Bn lbs (billion pounds) of copper in the M&I category and 3.3 billion pounds of copper in the Inferred category. 

We caught up with Paul West-Sells, President & CEO of Western Copper & Gold Corp. for the first time since October when we discussed the company business plan, the team and the strategy. We wanted to touch base as a few exciting things have happened since we last spoke. They've raised some money, had some good drill results and had some changes in the company structure. 

Company & Strategy Overview 

Western Copper & Gold is a simple company. They have one asset, which is the Casino Copper Gold project located in the Yukon. It is a large Copper Gold Porphyry with 3.5Bnt of ore containing 22Moz of Gold and 11Bn lbs of Copper. Western Copper and Gold has been developing this project for about 14-years and now is an exciting time to be in Copper and Gold.

Western Copper & Gold (WRN) - More Aggressive Plan Attracts Investors

Narrative & Perception Changing: Raise of CAD$28.8M

The company has recently raised CAD$28.75M which is a lot of money and the largest equity raise that the company has done as Western Copper & Gold. The investors that came into that equity raising are Blue Chip US funds. Copper price is on a run and there are very few sizable, economic Copper and Copper Gold assets in a good jurisdiction and Western Copper & Gold has one of them. Some people are intimidated by the size because it comes with a large capital cost number but that size attracts a certain type of potential investor too.  

The asset has always had a lot of Gold and a lot of Copper but there are a couple of things that have changed. The share price has gone up recently on the back of commodity prices and the company has been able to raise enough money with reasonable dilution for the shareholders. That amount of money is enough to get all the engineering done and all the way through permitting on the project. 

Process of Getting Back in Control & Encouraging Investment

Western Copper & Gold has attracted the big companies that want to get involved in Copper. There have been changes at board level within the company as they have brought in Mike Vitton who has good connections and is a businessman who can create value. He also gives optionality for the company when having conversations with these big funds.

Western Copper & Gold (WRN) - More Aggressive Plan Attracts Investors

Allocation of Money & Value Creation: PEA & FS, Timing & Expectations

The company now plans to advance at Casino, which is where most of that money is going. They are also allocating money to exploration to keep the story going in terms of the land package that they bought next to the current deposit. They are also planning to look at other opportunities are out there as the company is becoming more aggressive and savvy about the way they position themselves.  

Casino is a great project which needs to get permitted within 4 or 5 years. They plan to get the project going and update the engineering and have announced that they will be doing an updated PEA first by the end Q2/21, then into a Full updated Feasibility Study by the end of the year hopefully.

The biggest thing that will be going into the updated Feasibility Study is the new Resource, which was released last year. They completed some infill drilling and are reducing the strip ratio from about 0.6 to less than 0.5 which has a huge impact on the economics.  

They have also done a lot of work on tailings which is important to get through the permitting hurdle. They have spent 18-months working with the First Nations in particular, and the government and the regulators on tailings which will be rolled into the updated engineering. They will also be including some improved metallurgy with better recoveries which are small positive changes that will have a positive impact on the economics.

Western Copper & Gold (WRN) - More Aggressive Plan Attracts Investors

Future Options: Expectations for Western Copper & Gold 

The board is keen to build the company from here and they are potentially interested in buying a copper or gold asset too. Not just a development asset, maybe an operating asset to build the company into a multi-asset that also has some cash flow to create value for the shareholders. 

Driving Share Price Up: Moments to Look for

This year, the focus is on the engineering. The Casino project is a good, deep target and doesn’t need to get bigger right now. Now all they have to do is drive that share price by focussing on the updated PEA and the Feasibility at the end of the year to create a bit more excitement in the marketplace. 

The last time the Casino project had up-to-date economics was in 2013 so an updated PEA is due. The share price will be driven by this and other factors including the huge strip ratio, the recoveries, the new board, being aggressive as a company, and the high copper prices too. 

We appreciate the update with Western Copper & Gold and it sounds like PEA is the next big thing that we should be looking out for.  We are pleased that things are going well for the company, we like the new look and we look forward to keeping in touch with the news going forward.  Western Copper & Gold (WRN) - More Aggressive Plan Attracts Investors

To Find out more, go to Western Copper & Gold Website.


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