LANSING, Mich. — State taxpayers will spend up to $50 million on the polarizing Copperwood copper mine in the far western Upper Peninsula, following a 7-2 vote Tuesday by the Michigan Strategic Fund board.
The award marks a turning point for a project that has been pursued by Toronto-based Highland Copper Inc. since 2023 and has divided lawmakers, economic developers, and residents in the region for years.
The board directed $45 million toward an estimated $129 million in site readiness costs for the mine. It also awarded $5 million to the Gogebic County Road Commission to make road updates in Wakefield Township.
Highland Copper originally pitched the project as a $425 million mine that would create 380 jobs during an 11-year lifecycle and said it needed state dollars to be viable. The state grant covers roughly 10 percent of that original project cost estimate.
Funding bypasses the legislature
The money comes from the now-defunded SOAR (Strategic Operating and Attraction Reserve) Fund. The dollars had been allocated to the Strategic Fund board in October 2022 and remained unused. Because the appropriation was already made, lawmakers did not have to approve the grant, a procedural detail that sidestepped a fight that had stalled in the Legislature in earlier years.
The mine would be the first in the Upper Peninsula since 1955. Lawmakers and economic developers who support the project pointed to a recent poll showing 70 percent of state residents in favor of it.
"This grant delivers infrastructure the Western UP desperately needs but cannot afford: infrastructure to attract good-paying jobs like those that Copperwood brings," said Marty Fittante, CEO of InvestUP, an economic development group.
Public opposition
During at least two hours of public comments before the vote, many speakers questioned whether the mine's economic value justified the costs to the region's ecology and to taxpayers.
Most of the speakers opposed the project, warning of risks to nearby Lake Superior and the Porcupine Mountains from mining and its byproducts.
"We must protect Lake Superior at all costs from this mine," said Brian Mitchell, a Novi-based nature photographer. "If we do not protect our fresh water, no other business, economy or investment really matters in this state."
The proposal had come up for a vote as early as early 2024, and proponents tried several times to get lawmakers to approve it either as a SOAR appropriation or as an annual budget earmark.
Questions over financing
The $45 million state grant is worth more than half of Highland Copper's market value, which stood at about $80 million on Tuesday at a stock price of 12 cents a share.
Without the state funding, financing the full project would be "incredibly more challenging," company CEO Barry O'Shea told the board.
That dependence on public money drew criticism. Cindy Warner, a former member of the Strategic Fund board, wrote a letter opposing the project.
"This is a proposal to backstop, with public money, a project that private capital markets have not fully backed on their own merits," she wrote. "This is not a proper use of Michigan taxpayer dollars."
The Export-Import Bank of the United States indicated interest last fall in lending Highland $250 million through its Make More in America Initiative, but no financing has been finalized.
A timeline of failed attempts
Documents obtained through the Freedom of Information Act show the Michigan Economic Development Corp. initially offered Highland a $50 million subsidy more than three years ago. Several attempts to fund the project with public money followed.
In January 2024, the Strategic Fund board postponed a vote after pressing the company on its funding. Under questioning from the board, the company's CEO acknowledged it had no investors and far less capital than it needed.
In March 2024, the board passed the proposal without discussion, but only after setting a condition that Highland secure $150 million in capital. The proposal then stalled in gaining legislative support.
Rep. Greg Markkanen, R-Hancock, subsequently sought $50 million in the summer of 2024 for Wakefield Township to fund mine-related infrastructure such as roads and internet. His earmark did not make it into the budget.
"The proposal appears in every way identical to what has already been denied three times," said Tom Grotewohl, founder of Protect the Porkies, a nonprofit opposing proposed mines in the Upper Peninsula. "To propose it a fourth time is a grotesque attempt to steamroll over the clear will of the people."
Lawmakers who supported the project cited the region's mining history and argued that state oversight would protect the environment.
"For too long, the state of Michigan and its policies ignored this once prosperous region. The people have been abandoned, employers have left, hospitals have closed, the tax base has been devastated," said Rep. Dave Prestin, R-Cedar River.
"The roads, power systems, and telecommunications improvements supported by this grant will remain in place and continue serving the region for decades after the project operations conclude," he added.
What happens next
The mine would add U.S. based copper production at a time when electronics and data centers rely on the mineral. U.S. copper accounts for about 4 percent of the world's supply.
O'Shea said Highland is preparing to begin construction in 2028, a year after it releases an updated feasibility study that will refine its Copperwood plans. The company said it will be revising project costs by March and is considering a smaller facility that would use less power and supplies. Whether hiring will remain at the 380 expected new jobs is unclear.
So far, the company has spent about $15 million on the project.
The state said it would reduce the grant award if the overall investment and job creation target declines. The deal also set conditions on the grant. Highland Copper must show $150 million of additional financing by spring 2028, provide a spreadsheet of anticipated spending, prove it created 380 jobs, and finish the infrastructure spending by March 31, 2033.