US-headquartered Excelsior Mining’s board has given the green light for the construction of the Gunnison copper mine, in Arizona, following the closing of a $75-million project financing package.

Provided by Triple Flag Mining Finance Bermuda, the financing consists of a $65-million copper metal stream and a concurrent $10-million private placement of common shares.

President and CEO Stephen Twyerould says the completion of the financing package allows the company to initiate construction activities before the end of December. First copper production from the wellfield is forecast for 2019.

The Gunnison project is an in-situ recovery project and is the first new copper project to be fully permitted in the US in more than a decade.

The feasibility study envisages a three-stage project with capacities of 25-million pounds a year in Stage 1, ramping up to 125-million pounds a year in Stage 3.

The study also projected an after-tax net present value of $807-million and an internal rate of return of 40%, using a $2.75/lb copper price and a 7.5% discount rate.

Excelsior says that it received initial gross proceeds of $20-million from the financing package, $10-million of which was from the $65-million upfront deposit under the terms of a metals purchase and sale agreement and a further $10-million from the placement. The balance of the Stage 1 deposit will be provided in instalments at the request of Excelsior as it expends or allocates previously received funds for the construction of the project.

Excelsior is expecting an additional $9.4-million in financing proceeds from affiliates of Greenstone Resources pursuant to the terms of a previously announced subscription agreement. In addition, if Altius Royalty chooses to exercise its construction royalty option, Excelsior shall receive a further C$5-million in financing proceeds.

Excelsior announced the decision to proceed with construction of Gunnison on Friday, sending its TSX-listed stock up 3.3% on the day to close at C$0.95 a share. On Monday, the company gained a further 2% to C$0.97 a share.