Highland Copper Announces Final Approval of US$50 Million Grant From the State of Michigan for Copperwood Project

Michigan Approves $50 Million Grant for Copperwood Mine Project

The Michigan Strategic Fund has approved US$50 million in performance-based grant funding under the Strategic Site Readiness Program (SSRP) to support development of the Copperwood Project in Gogebic County, Michigan. The approval, announced by Highland Copper Company Inc. on Aug. 25, marks a significant milestone after previous attempts to secure state funding failed over the past two years.

The grant is split between two recipients: US$44,971,691 will go to Copperwood Resources Inc., a wholly owned subsidiary of Highland Copper, to support eligible infrastructure expenditures, while US$5,028,309 will be directed to the Gogebic County Road Commission for critical local infrastructure improvements. The road commission has also secured a separate US$7,542,463 Transportation Economic Development Fund Category A grant from the Michigan Department of Transportation. Together, the two grants will provide approximately $12,570,722 for improvements to County Road 519, enhancing road safety and access for the broader region.

A Third Attempt at State Funding

This is the third time Highland Copper has sought state dollars for the project. The company first requested $50 million through the SOAR fund in January 2024, which was approved in March 2024 but later expired due to lack of action by the Senate Appropriations Committee. State Rep. Gregory Markkanen subsequently attempted to include a $50 million earmark in the state's 2026 budget, but it was cut from the final version.

The latest funding comes from a $250 million appropriation in a 2022 supplemental budget bill, which allows the grants to bypass state lawmaker approval. Michelle Grinnell from the Michigan Economic Development Corp. (MEDC) explained that the funding became available after another project fell through. The Michigan Strategic Fund voted 7-2 to approve the $44.9 million grant for Highland Copper and unanimously for the $5 million to the road commission.

Project Details and Conditions

The Copperwood Project, a $425 million undertaking by the Canadian company, is fully permitted and would be built near the Porcupine Mountains Wilderness State Park. It is expected to create 380 jobs and generate $12 million in annual tax revenue. Over an 11-year lifespan, the mine is projected to generate $121 million in state and local tax revenue. If it opens, Copperwood would be the first copper-focused mine in the Upper Peninsula since the White Pine Mine closed in 1997.

The grant includes conditions: Highland Copper must obtain commitments for US$150 million in additional project financing by March 31, 2028, and expenditures eligible for reimbursement must be made on or before March 31, 2033. The company is also required to establish a minimum of 380 qualified jobs at the project. Highland Copper CEO Barry O'Shea said the funding represents an important milestone and strengthens the company's capacity to finance the project. In September, the company announced a non-binding letter of interest from the U.S. Export-Import Bank for up to $250 million in debt financing. O'Shea told the board that construction is planned for 2028.

Support and Opposition

The grant approval was met with both celebration and concern. Michigan State Senator Ed McBroom called the grants "a wonderful investment in communities and infrastructure." Garth Stengard, manager of the Gogebic County Road Commission, said the funding gives the region an "opportunity to move forward." Supporters argue the mine will provide a domestic supply of copper and critical infrastructure upgrades to the rural western Upper Peninsula. A coalition of over 130 local leaders, businesses and residents has formed to support the project, and more than 22 formal resolutions from governmental agencies and 10 letters of support from local and regional stakeholders back it.

However, dozens of people spoke against the project at the board meeting, and another 127 signed up for virtual comments. Opponents, including environmental groups and Indigenous tribes, have raised concerns about the mine's proximity to Lake Superior and the Porcupine Mountains, including a 320-acre tailings basin. Emily Smith from the Michigan Environmental Council said the mine poses significant risk to fresh water. Lauren Pomeroy told the board that Michigan taxpayers should not be asked to help a Canadian mining company "rip open one of the most sacred, protected places in the state." The group Protect the Porkies has gathered nearly half a million petition signatures against the project.

State Rep. Gregory Markkanen noted that Gogebic County has the highest poverty rate in the Upper Peninsula, and supporters highlight that the jobs would pay between $80,000 and $120,000, about twice the regional median wage of $41,000. Highland Copper CEO Barry O'Shea said in a statement: "We continue to believe that the Cottonwood Project represents a generational opportunity for the Western U.P. where the creation of jobs can coexist with environmental protections."

Britany Affolter-Caine, a Michigan Strategic Fund board member, said the board weighed many different viewpoints and acknowledged there are competing interests. The grant approval does not require further state approvals, but the project must still meet its financing conditions before moving forward.