Western Copper and Gold Corporation Annual Report 2010

FY2010 Annual Report · Western Copper and Gold Corporation

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2010 ANNUAL REPORT

CasinoBillion lb COPPER4.461Million oz GOLDMillion oz SILVEROne of the world’s largest open-pittable copper, gold, molybdenum and silver deposits.Proven & Probable Reserves [See pages 12-13]8.4494Million lb MOLYCONTENTS

CEO’s Letter to Shareholders

Interview with the President

& COO

Property Overview

Reserve & Resource Tables

MD&A

Financial Statements

WESTERN COPPER IS

A CANADIAN MINING

EXPLORATION AND

DEVELOPMENT COMPANY

WITH A FULL PIPELINE OF

PROJECTS, A STRONG

CASH POSITION, NO DEBT

AND AN EXPERIENCED

MANAGEMENT TEAM.

OWNERSHIP100%RESERVES976 Mt Mill @ 0.50% CuEq (0.20% Cu, 0.24 g/t Au,1.73 g/t Ag) 82 Mt Heap @ 0.37 g/t Au, 2.55 g/t AgPROCESSConventional flotation and gold heap leachMINE TYPEOpen pitMINE LIFE23 yearsLOCATION380 km (240 mi) northwest of Whitehorse, Yukon 560 km (350 mi) from year-round port at Skagway, AlaskaSTATUSPre-feasibility study completed/ Permitting Preparation/ExplorationCEO’S LETTER TO THE

Dear Shareholders,

2010 turned out to be a very good year for Western Copper Corporation. Our market

capitalization, which was around $70 million mid-year, increased to $245 million by

year-end and currently stands at $350 million.

After 2 years of intensive work at Casino, our flagship property, we more than doubled

the size of the deposit to 2.8 billion tonnes. The numbers speak for themselves:

measured, indicated and inferred resources consisting of 18 million ounces of gold, 10

billion pounds of copper, 1.3 billion pounds of molybdenum and 140 million ounces of

silver. These numbers, most notably the 18 million ounces of gold, are impressive to

say the least.

Throughout much of 2010, our engineering team worked on overhauling the existing

pre-feasibility study for Casino. We released a significantly updated pre-feasibility study

in early April 2011, which demonstrated the excellent economics of the project. At long

term metal prices the project has an internal rate of return of 16.2 %, and 26.8 % at

current metal prices. The project will cost $2.1 billion and will re-pay its capital in 3.3

years at long term metal prices and 2.1 years at current metal prices.

Casino is truly one of the world’s largest undeveloped copper, gold and molybdenum

deposits. I am very proud of the great work that our technical team, including

We are also continuing to advance our

Carmacks copper project. Studies are

underway that will address the concerns

of the Water Board and it is our intent to

re-submit our application later this year or

early next year.

At Island Copper we are planning a

comprehensive evaluation which will

include a new resource estimate, a

new geophysical survey and additional

diamond drilling to better define the

deposit; this information will be used

to prepare a Preliminary Economic

Assessment.

At Redstone, the geologic department

of the University of British Columbia will

be back in the field for their third year of

assessing the potential of this exciting

consultants, have done in bringing this project to its current level. The same team will

deposit.

now focus on the next step of completing a full feasibility and getting the project ready

for permitting.

OVERVIEW

2010 ANNUAL REPORT

Last year I noted that metal demand and

prices were back to where they were

prior to the 2009 financial crisis. This year

it is safe to say that demand for all metals

SHAREHOLDERSand commodities in general has been

remarkable.

The major copper producers and

producing nations are predicting that

copper supplies will fall short of demand

by 500,000 tonnes in 2011 and 2012 with

new league of development companies.

little hope that supply and demand will be

in balance in the foreseeable future. This

is due to an unprecedented demand from

China and other developing countries.

Copper inventories currently stand at just

under 600,000 tonnes; in China alone,

total consumption is expected to reach

over 7 million tonnes this year.

As we work together to increase the

company’s value even more so, the team

is as focused and committed as ever

to moving our projects forward to the

benefit of our shareholders.

At the current projected world growth

On behalf of the Board of Directors,

rate of 4%, it will require that 8 projects

Dale Corman Chairman and CEO

April 22, 2011

the size of Casino be built every year to

meet demand. In other words, we expect

that copper prices will continue to rise

and that the current copper price will

eventually prove to be conservative.

Western Copper has truly broken out in

2010, reaching new heights and entering a

AT THE CURRENT

PROJECTED WORLD

GROWTH RATE OF 4%,

IT WILL REQUIRE THAT

8 PROJECTS THE SIZE

OF CASINO BE BUILT

EVERY YEAR TO MEET

DEMAND

2010 ANNUAL REPORT

OVERVIEW 03

INTERVIEW WITH THE

Q: What were the biggest high-

lights of 2010, in your mind?

Q: What was the biggest

challenge of 2010?

Q: What do you foresee as your

biggest challenge for 2011?

A: The key highlights from 2010

centered around our Casino project.

A: Our biggest challenge during 2010

was keeping the company focused on Casino

A: For 2011, I see the key challenge as

bringing the Island Copper project into active

The new resource we issued in November

as our key project.

exploration while keeping the Casino project

Having four excellent projects in our portfolio

moving forward.

is certainly one of our strengths, but work

We think that the Island Copper project looks

on these projects needs to be managed

as strong as the Casino project; it’s just a

carefully to ensure that our energies are

couple of years behind.

directed on what will realize the most value
to shareholders.

We’ve got a great team in place already

and we’re excited about bringing a second

copper-gold project forward.

was the result of an extensive program

of drilling, re-logging, and re-modeling the

deposit. The current resource figures raise

the Casino project into a select group of very

large world class copper-gold projects. The

release of the new resource was followed by

the pre-feasibility study update we released

in early 2011, which cemented the robust-

ness of the economics of Casino.

The other big highlight of 2010 was metal

prices, with both copper and gold having a

very strong year in 2010. Casino with 4.4 bil-

lion pounds of copper and 8.4 million ounces

of gold in reserve is certainly an asset we are

glad to have in this metal price environment.

OVERVIEW

2010 ANNUAL REPORT

PRESIDENT & COO

Q: You ended the year by raising

Q: What distinguishes Western

capital – how far will that take you and do

Copper from other companies in the

you foresee another financing this year?

junior copper space?

A: We may do a small flow-through

A: There are several things that

financing this year to support the Island

distinguish Western Copper from other

Copper project exploration program, but I

companies in the junior space.

don’t expect to do another large financing.

First, is our rich portfolio of projects.

NOT MANY JUNIOR

The $23 million we raised last year should

easily support what we have planned for

2011 and bring us well into 2012.

Not many junior mining companies can boast

of having four excellent projects—particularly

MINING COMPANIES CAN

in the copper space.

Second is our team.

We have a strong internal team of engineers

and geologists that can pick the right projects

and move them forward quickly.

Last, is our track history.

Going back to the predecessor company,

Western Silver, we’ve shown that we can

build great shareholder value by taking

projects from drill holes to feasibility and

beyond, and we’re going to just keep

working in that direction.

BOAST OF HAVING FOUR

EXCELLENT PROJECTS

— PARTICULARLY IN THE

COPPER SPACE

2010 ANNUAL REPORT

OVERVIEW 05

OVERVIEW

NEXT STEPS

The Casino project is located 380 km northwest of Whitehorse, Yukon, within

ADVANCE PROJECT FORWARD

Selkirk First Nation traditional territory. Based on an updated pre-feasibility

study completed in April 2011, the deposit will be developed as an open

pit mine and a mill processing 120,000 tpd and producing an average of

 Initiate steps towards full feasibility
study
 Begin application for environmental
assessment

435,000 ounces of gold, 234 million pounds of copper, 13 million pounds of

molybdenum and 1.6 million ounces of silver per year over the first four years

of production.

SECURE FINANCING

 Evaluate funding options

The pre-feasibility study recommends development of the Casino deposit as

a conventional, electrified truck-shovel open pit mine. The initial development

will focus on the deposit’s oxide cap as a heap leach operation to recover

gold and silver in doré form. The main sulphide deposit will be processed

using a conventional concentrator to produce copper-gold and molybdenum

concentrates. Additionally, a pyrite rich stream from the concentrator will

be leached in a CIL circuit for recovery of gold and silver. Copper-gold and

molybdenum concentrates will be transported to the port of Skagway, Alaska

for shipping to smelters.

OVERVIEW

2010 ANNUAL REPORT

WORLD CLASS PROJECT IN THE YUKONCasinoPROVEN + PROBABLE RESERVE

GOLD

COPPER

MOLY

SILVER

8.4 4.4 494 61

Million oz

Billion lb

Million lb

Million oz

[See pages 12-13]

SNAPSHOT

OWNERSHIP

100%

DEPOSIT TYPE

Porphyry

PROCESS

Conventional flotation mill + gold heap leach

MINE TYPE

Open pit

MINE LIFE

23 years

EMPLOYEES

608 (peak) and 1,600 during construction

LOCATION

380 km (240 mi) northwest of Whitehorse, Yukon
560 km (350 mi) from year-round port at Skagway, Alaska

STATUS

Permitting preparation / Exploration / Pre-feasibility
update / Planning towards full feasibility

KEY DATA

Total Capex (C$ M)

Pre-Tax NPV @ 5% (C$ M)

Pre-Tax NPV @ 8% (C$ M)

SPOT
Mar 2011 (1)

LONG
TERM (2)

2,130

5,860

3,927

2,570

1,570

Pre-Tax IRR (100% equity) (%)

32.2%

19.6%

After-Tax NPV @ 5% (C$ M)

After-Tax NPV @ 8% (C$ M)

4,004

2,621

1,700

963

After-Tax IRR (100% equity) (%)

26.8%

16.2%

Cash Flow (Y1-Y4) (C$ M/y)

Cash Flow (LOM) (C$ M/y)

Payback (y)

830

430

2.1

Cu Cash Cost (net of credits) (US$ /lb)

(0.49)

567

250

3.3

0.06

Based on Pre-Feasibility Study - April 2011

Notes:

1. Metal price: US$ 4.30/lb Copper, US$1,439/oz Gold, US$17.29/lb Moly, US$37.87/oz Silver

Foreign Exchange: C$1.00 = US$1.00

2. Metal price: US$ 2.78/lb Copper, US$1,222.22/oz Gold, US$15.56/lb Moly, US$18.89/oz Silver

Foreign Exchange C$1.00 = US$1.00

2010 ANNUAL REPORT

OVERVIEW 07

OVERVIEW

NEXT STEPS

The project will be an open pit mine producing copper cathode on site

OBTAIN WATER USE LICENSE

by crushing, stacking, and heap leaching the ore and treating the leach

 Anticipate water license issued in 2012

solution through a solvent extraction/electrowinning (SX-EW) plant.

Construction will require 2 years, followed by more than 6 years of

production. Power for the project will be taken from the yukon power

grid via an 11 km spur line. Acid will be produced on site by a 140 tpd

acid plant.

GET PROJECT READY FOR PRODUCTION

 Examine development options

OVERVIEW

2010 ANNUAL REPORT

CarmacksREADY FOR CONSTRUCTIONPRODUCTION

CASH COST

32 0.84

Million lb Cu/yr

US$/lb Cu

SNAPSHOT

OWNERSHIP

100%

RESERVE

10.6 million tonnes (Proven + Probable)

PRIMARY METALS

Copper

PROCESS

Heap leach, solvent extraction/electrowinning

END PRODUCT

Copper cathode

MINE TYPE

MINE LIFE

Open pit

6+ years

EMPLOYEES

180 (peak production), 250 (peak construction)

LOCATION

220 km north of Whitehorse, Yukon - 400 km from
year-round port at Skagway, AK

INFRASTRUCTURE

Good road access, upgrade of a 13 km access road

POWER

STATUS

12 km from Yukon power grid

Engineering / Permitting
(Obtained license allowing construction)

KEY DATA

Total Capex (C$ M)

Copper (C$ M)

Foreign Exchange (%)

Pre-Tax NPV @ 8% (C$ M)

Pre-Tax IRR (100% equity) (%)

After Tax NPV @ 8% (C$ M)

After Tax IRR (100% equity) (%)

Cash Flow (C$ M/y)

Payback (y)

SPOT
Apr 2011 (1)

LONG
TERM (2)

151

4.30

1.00

313

50.3

193

37.5

1.6

2.50

0.90

22.1

16.4

3.8

Based on Pre-Feasibility Study - May 2007

Notes:

1. Metal price: US$ 4.30/lb Copper - Foreign Exchange C$1.00 = US$1.00

2. Metal price: US$ 2.50/lb Copper - Foreign Exchange C$.90 = US$1.00

2010 ANNUAL REPORT

OVERVIEW 09

MEASURED + INDICATED RESOURCE
COPPER

GOLD

1.4 2.3

Million lb

Million oz

[See page 15]

NEXT STEPS

CONTINUE EXPLORATION
 Induced polarization (IP) study
 5,000 – 10,000 m of drilling

OVERVIEW

The project is located on Vancouver Island 29 km from the reclaimed BHP

Island Copper Mine. Excellent infrastructure including parts of the BHP

marine load-out and hydro power infrastructure remain in place.

The Island Copper porphyry copper-molybdenum-gold property consists of

216 mineral claims (approximately 42,669 hectares) and is comprised of

the Hushamu, Red Dog and NW Expo deposits. After internal review of the

project an exploration plan for 2011 has been put in place.

SNAPSHOT

OWNERSHIP

100%

DEPOSIT TYPE

Porphyry

PRIMARY METALS

Copper, gold, molybdenum and rhenium

MINE TYPE

Open pit

LOCATION

Vancouver Island (25 km west of Port Hardy, BC)

INFRASTRUCTURE

29 km (18 mi) from infrastructure of Island Copper Mine
tide water port and high voltage power

STATUS

Commencing exploration options

RESOURCE

231 M tonnes @ 0.47 CuEq (0.28% Cu, 0.31 g/t Au)

Based on Technical Report: April 2005

OVERVIEW

2010 ANNUAL REPORT

Island CopperPRIME LOCATION
INFERRED RESOURCE
COPPER

COPPER

2.9 3.92

Billion lb

% Grade

OVERVIEW

The Redstone project is located 290 km south of Norman Wells, Northwest

Territories and comprises discontinuous claims and leases stretching over

approximately 100 km in a northwest-southeast orientation. The Redstone

copper belt is essentially an unmetamorphasized succession that is locally

[ See page 15]

well exposed in an arcuate belt less than 15 km wide and about 300 km

NEXT STEPS

long. The inferred resource is located on the Coates Lake leases, which

CONTINUE EXPLORATION PROGRAM

 UBC to continue ongoing study of

regional geology

 Exploration program to be developed
based on UBC’s results

represents a small proportion of the total area of mineral rights. Western

Copper is currently in the midst of a three year project with the University of

British Columbia’s (UBC) mineral deposit research unit to analyze the regional

geology in order to develop our future exploration plans.

SNAPSHOT

OWNERSHIP

100%

DEPOSIT TYPE

Sediment-hosted straitiform copper deposit

RESOURCE

34 Million t @ 4.0 CuEq (3.92% Cu, 9.0 g/t Ag)

METALS

MINE TYPE

LOCATION

STATUS

Copper and silver

Underground

Nahanni Mining District, Northwest Territories claims and
leases over approximately 160 km

UBC project to study regional geology and identify area
with good exploration potential

Based on Technical Report: August 2005

2010 ANNUAL REPORT

OVERVIEW 11

RedstoneENORMOUS POTENTIAL
ReseRve & ResouRce Tables

CASINO

NI 43-101 Compliant Resource Estimate *

LEACHED CAP / OXIDE GOLD ZONE AT 0.25 g/t Au Cut-off

Resource Grade

Contained Metal

Category

Measured

Indicated

Measured + Indicated

Inferred

Tonnes
M

Copper
%

Gold
g/t

0.05

0.03

0.04

0.01

0.52

0.33

0.40

0.31

Moly
%

0.025

0.017

0.020

0.008

Silver
g/t

CuEq
%

Copper
B lb

Gold
M oz

Moly
M lb

Silver
M oz

2.94

2.36

2.57

1.93

0.55

0.36

0.43

0.27

0.0

0.1

0.0

0.5

0.6

1.1

0.2

2.9

4.0

6.9

1.1

SUPERGENE OXIDE ZONE AT 0.25% Cu EQ Cut-off

Resource Grade

Contained Metal

Category

Measured

Indicated

Measured + Indicated

Inferred

Tonnes
M

Copper
%

Gold
g/t

0.28

0.23

0.25

0.26

0.52

0.21

0.34

0.17

Moly
%

0.026

0.019

0.022

0.010

Silver
g/t

CuEq
%

Copper
B lb

Gold
M oz

Moly
M lb

Silver
M oz

2.38

1.44

1.82

1.43

0.78

0.48

0.60

0.44

0.2

0.3

0.1

0.4

0.2

0.7

0.1

1.9

1.7

3.6

1.2

SUPERGENE SULPHIDE ZONE AT 0.25% Cu EQ Cut-off

Resource Grade

Contained Metal

Category

Measured

Indicated

Measured + Indicated

Inferred

Tonnes
M

Copper
%

Gold
g/t

216

252

102

0.39

0.24

0.26

0.20

0.41

0.22

0.25

0.19

Moly
%

0.029

0.019

0.020

0.010

Silver
g/t

CuEq
%

Copper
B lb

Gold
M oz

Moly
M lb

Silver
M oz

2.34

1.72

1.81

1.49

0.83

0.50

0.55

0.39

0.3

1.1

1.5

0.5

1.5

2.0

0.6

114

2.7

11.9

14.7

4.9

HYPOGENE ZONE AT 0.25% Cu EQ Cut-off

Resource Grade

Contained Metal

Category

Measured

Indicated

Measured + Indicated

Inferred

Tonnes
M

Copper
%

Gold
g/t

711

743

1568

0.32

0.17

0.18

0.14

0.38

0.21

0.22

0.16

Moly
%

0.026

0.023

0.020

Silver
g/t

CuEq
%

Copper
B lb

Gold
M oz

Moly
M lb

Silver
M oz

1.94

1.65

1.66

1.36

0.72

0.45

0.46

0.37

0.2

2.7

2.9

4.8

0.4

4.8

5.2

8.1

360

379

691

2.0

37.7

39.7

68.6

OVERVIEW

2010 ANNUAL REPORT

NI 43-101 Compliant Reserve Estimate **

Class

Tonnes
M

Copper
%

Contained Metal

Silver
g/t

CuEq
%

Copper
B lb

Gold
M oz

Moly
M lb

Silver
M oz

Reserve Grade

Gold
g/t

0.44

0.22

Moly
%

0.028

0.023

0.34

0.19

2.23

1.68

0.79

0.47

0.20

0.24

0.023

1.73

0.50

0.052

0.494

0.035

0.299

0.04

0.37

2.88

2.37

2.55

n/a

0.7

3.7

4.4

0.03

0.04

0.1

1.3

6.2

7.5

0.5

1.0

439

494

6.5

47.8

54.3

2.7

4.0

6.7

MILL ORE Proven

MILL ORE Probable

MILL ORE TOTAL
Proven + Probable

HEAP LEACH Proven

HEAP LEACH Probable

HEAP LEACH TOTAL
Proven + Probable

885

976

NOTES

Supergene Oxide, Supergene Sulfide & Hypogene Zone cut-off 0.25% Cu Eq
Leach Cap / Oxide Gold Zone cut-off 0.25 g/t Au

Technical Report December 2010 - NI 43-101 Independent Qualified Person: Gary H. Giroux, P.Eng - Cu Eq Metal Prices: US$2.00/lb copper, US$875/oz gold,
US$11.25/lb molybdenum

** Technical Report May 2011 - NI 43-101 Independent Qualified Person: M. Hester FAusIMM - Cu Eq Metal prices: US$2.00/lb copper, US$875.00/oz gold and

US$11.25/lb molybdenum

2010 ANNUAL REPORT

OVERVIEW 13

CARMACKS

NI 43-101 Compliant Resource Estimate *

OXIDE

Category

Measured

Indicated

Resource Grade

Contained Metal

Tonnes
M

Total Copper
%

Oxide Copper
%

Gold
g/t

Silver
g/t

CuEq
%

Copper
M lb

Gold
k oz

Measured + Indicated

12.0

Inferred

0.1

4.0

7.9

1.10

1.04

1.06

0.73

0.90

0.83

0.85

0.53

0.59

0.39

0.46

0.13

5.7

4.0

4.57

1.8

1.52

1.32

1.39

0.83

182

280

100

176

Silver
k oz

739

1,022

1,761

SULPHIDE

Category

Measured

Indicated

Measured + Indicated

Inferred

Resource Grade

Contained Metal

Tonnes
M

Total Copper
%

Oxide Copper
%

Gold
g/t

Silver
g/t

CuEq
%

Copper
M lb

Gold
k oz

Silver
k oz

0.7

3.6

4.3

4.0

0.80

0.74

0.75

0.71

0.02

0.03

0.01

0.26

0.21

0.22

0.18

2.5

2.3

2.33

1.9

0.99

0.89

0.91

0.84

270

325

246

NI 43-101 Compliant Reserve Estimate **

Reserve Grade

Contained Metal

Class

Proven

Probable

Proven & Probable

Tonnes
M

Total Copper
%

Oxide Copper
%

3.2

7.4

10.6

1.23

0.97

1.04

1.028

0.822

0.88

Gold
g/t

0.659

0.408

0.48

Silver
g/t

CuEq
%

Copper
M lb

Gold
k oz

Silver
k oz

6.20

3.94

4.62

1.70

1.26

1.39

158

222

636

940

165

1,576

NOTES

Technical Report: Wardrop, December 2007 - Qualified Person: G. Arsenau Ph.D., P.Geo & Scott Casselman P.Geo. - Total copper Cut-off: 0.25% - Cu Eq Metal
prices: US$2.00/lb copper, US$875.00/oz gold, US$11.25/oz silver - Oxide resource estimate for Zones 1, 4 and 7. Sulphide resource estimate for Zone 1 - No
discount for metallurgical recovery in contained metal figures

** Technical Report: May 2007 - Qualified Person: M. Hester FAusIMM - Cu Eq Metal prices: US$2.00/lb copper, US$875.00/oz gold, US$11.25/oz silver - Includes

mining dilution

OVERVIEW

2010 ANNUAL REPORT

ISLAND COPPER

NI 43-101 Compliant Resource Estimate

Resource Grade

Contained Metal

Tonnes
M

Copper
%

192

231

0.29

0.27

0.28

Gold
g/t

0.31

0.38

CuEq
%

Copper
B lb

Gold
M oz

0.49

0.47

0.52

0.3

1.1

1.4

0.3

0.4

1.9

2.3

0.6

Class

Measured

Indicated

Measured + Indicated

Inferred

NOTES

Technical Report: April 2005 - Qualified Persons: G. Giroux P. Eng. & D. Pawliuk P.Geo. - Total copper Cut-off: 0.20% - Cu Eq Metal prices: US$0.80/lb copper,
US$350/oz gold - No discount for metallurgical recovery in contained metal figures

REDSTONE

NI 43-101 Compliant Resource Estimate

Resource Grade

Contained Metal

Class

Tonnes
M

Copper
%

Inferred

3.92

Silver
g/t

9.0

CuEq
%

Copper
M lb

Silver
M oz

4.0

2,938

9.8

NOTES

Technical Report: August 2005 - Qualified Persons: A.W. Gourlay P.Geo. - 3.0% copper minimum assay intercept - Cu Eq Metal prices: US$2.00/lb copper,
US$11.25/oz silver - No discount for metallurgical recovery in contained metal figures

2010 ANNUAL REPORT

OVERVIEW 15

managemenT
discussion & analysis

Description of Business

Quarterly Summary of Activities

Property Overview

Selected Quarterly Financial Information

Results of Operations

Liquidity and Capital Resources

Contractual Obligations

Significant Accounting Estimates

Change in Accounting Policies

International Financial Reporting Standards

Disclosure Controls and Proceedures

Management’s Report on Internal Controls Over

Financial Reporting and Disclosure Controls

Financial Instrument Risk

management discussion & analysismanagemenT discussion & analysis

The following management discussion and analysis of Western Copper Corporation (“Western Copper” or the “Company”)
is dated March 24, 2011, and provides an analysis of the Company’s results of operations for the year ended December 31,
2010.

This discussion is intended to provide investors with a reasonable basis for assessing the financial performance of the
Company as well as certain forward looking statements relating to its potential future performance. The information should
be read in conjunction with the Western Copper Corporation December 31, 2010 audited annual consolidated financial
statements and the related notes for the year then ended which have been prepared in accordance with Canadian generally
accepted accounting principles. Western Copper’s accounting policies are described in note 2 of the December 31, 2010
audited annual consolidated financial statements. All of the financial information presented herein is expressed in Canadian
dollars, unless otherwise indicated.

Western Copper is listed on the Toronto Stock Exchange (“TSX”) and the NYSE Amex under the symbol ‘WRN’. At March
24, 2011, the Company had 91,677,070 common shares outstanding.

Additional information on the Company can be found in the Company’s Annual Information Form (“AIF”), filed with Canadian
regulators on SEDAR at www.sedar.com and with the United States Securities and Exchange Commission (the “SEC”) at
www.sec.gov on Form 40-F.

The operations of the Company are highly speculative due to the high-risk nature of the mining industry. Western Copper
faces risks that are generally applicable to its industry and others that are specific to its operations. Certain key risks affecting
the Company’s current and future operations are discussed in its AIF and Form 40-F. This list is not exhaustive. Additional
risks not currently known to the Company, or that the Company currently deems immaterial, may also impair the Company’s
operations. If any of the risks actually occur, actual results could differ materially from those described in the forward looking
statements contained in this management discussion and analysis. Reference is made to the discussion of forward-looking
statements on page 27.

1. DESCRIPTION OF BUSINESS

Western Copper Corporation is a Canadian-based publicly-traded mineral exploration company with a primary focus of advanc-
ing its mineral properties towards production.

All of Western Copper’s properties are located in Canada. The Company’s two most advanced projects are located in the Yu-
kon. The Casino project is one of the largest undeveloped porphyry deposits in Canada. Western Copper is currently working
on updating the pre-feasibility study that it completed on the project in June 2008. The Carmacks Copper Project is in the last
phase of permitting.

2. QUARTERLY SUMMARY OF ACTIVITIES

Significant increase to the Casino Project’s Mineral Resource Estimate

On November 1, 2010, Western Copper announced an updated resource estimate for the Casino Project. The new resource
estimate is the first estimate to include the 26,000 metres of drilling performed by Western Copper over the past three years
and represents a significant update to the resource estimated in 2008. In addition to the inclusion of the new drilling, the
new estimate includes a re-interpretation of the geology of the deposit, which includes the re-logging of 90,000 metres of
core.

MANAGEMENT DISCUSSION & ANALYSIS

2010 ANNUAL REPORT

Financing

On December 22, 2010, Western Copper issued 9,395,500 units at a price of $2.45 for gross proceeds of approximately $23
million. Each unit comprised one common share of the Company and half of one warrant. Each whole warrant is exercisable
for one common share of the Company at a price of $3.45 and expires on December 22, 2012.

NYSE Amex Listing

Western Copper began trading on the New York Stock Exchange (“NYSE”) Amex on February 9, 2011 under the symbol
‘WRN’, the same symbol that the Company trades under on the TSX.

Carmacks Copper Project Water Use License Appeal Decision

On February 24, 2011, Western Copper received notification of the Yukon Supreme Court’s ruling regarding the Company’s
appeal of the Yukon Water Board’s decision not to grant the Carmacks Copper Project a Water Use License. Western Cop-
per had appealed the Yukon Water Board’s decision in order to clarify the rules it would have to follow for re-application of a
Water Use License.

3. PROPERTY OVERVIEW

Casino (Yukon, Canada)

The Casino porphyry copper-gold-molybdenum deposit is located 300 kilometres northwest of Whitehorse, Yukon. It has
been the subject of considerable exploration going back to 1967.

Should Western Copper make a production decision on the property, it is required to make a cash payment of $1 million.
Production on the claims is also subject to a 5% net profits interest.

In June 2008, Western Copper announced that an independent pre-feasibility study on the Casino property supports the
development of the project.

The goal of the drilling campaign, to increase the near-surface supergene sulfide zone, was achieved. The size of this zone
has increased from 133 million tonnes to 252 million tonnes at the measured and indicated level – an increase of 90% (Table
1).

The largest increase to the resource comes at the inferred level of categorization. The combined supergene oxide, super-
gene sulphide, and hypogene inferred resource, at a 0.25% Copper Equivalent (“CuEq”) cutoff grade has been increased over
6 times to 1.70 billion tonnes (Table 2). The most recent results have added 7.4 million ounces of gold, 4.4 billion pounds of
copper, and 615 million pounds of molybdenum to the resource at the inferred level.

The increase in supergene mineralization should result in higher grades at the beginning of the mine life and a lower strip
ratio. Both of these factors are expected to improve the project’s economics. Western Copper plans to release the results of
an updated pre-feasibility near the end of March 2011.

Other than the new resource estimate, the updated pre-feasibility is expected to include an increased throughput of 120,000
tonnes per day, the use of natural gas for power generation, and a new road route, among other items.

MANAGEMENT DISCUSSION & ANALYSIS 19

2010 ANNUAL REPORT

Following the release of the updated pre-feasibility study results, the Company will refine the engineering on metallurgy, geo-
technical, and infrastructure and other aspects of the project with a view of progressing the Casino Project to the feasibility
study stage by the end of 2012.

The Company will also continue its environmental programs in 2011 with a view of submitting the application to the Yukon
Environmental and Socio-Economic Board (“YESAB”) by the end of 2012.

Table 1: Supergene Sulphide Zone Measured & Indicated Resource

Supergene Sulfide Zone (2010 Estimate)

Class

Cutoff
CuEq (%)

Tonnes
M

Copper
%

Measured

Indicated

0.25%

Total Measured + Indicated

216

252

0.39

0.24

0.26

Supergene Sulfide Zone (2008 Estimate)

Class

Cutoff
CuEq (%)

Tonnes
M

Copper
%

Measured

Indicated

0.25%

Total Measured + Indicated

100

133

0.39

0.29

0.31

Gold
g/t

0.41

0.22

0.25

Gold
g/t

0.47

0.25

0.31

Moly
%

0.029

0.019

0.021

Moly
%

0.030

0.020

Silver
g/t

2.34

1.72

1.81

Silver
g/t

–

CuEq
%

0.84

0.50

0.55

CuEq
%

0.87

0.56

0.63

Table 2: Inferred Resource of combined Supergene Oxide, Supergene Sulphide, and Hypogene Zones at 0.25% CuEq Cut-off

Estimate

Tonnes
M

Copper
%

New (2010)

1,696

Old (2008)

232

0.14

0.16

Gold
g/t

0.16

0.18

Moly
%

Silver
g/t

CuEq
%

Copper
B lb

Gold M
oz

Moly
M lb

Silver
M oz

0.019

1.37

0.019

–

0.37

0.38

5.2

0.8

8.7

1.3

711

74.7

–

•

Gary Giroux, P.Geo. is the independent qualified person responsible for the preparation of the updated Mineral Resource estimate
and the 2008 Mineral Resource estimate.

The Copper Equivalent grade has been calculated using the following commodity prices: US$2.00/lb copper, US$875/oz gold,
US$11.25/lb molybdenum, US$11.25/oz silver, and assuming 100% metallurgical recoveries.

The 2008 Mineral Resource estimate Copper Equivalent grade has been calculated using the following commodity prices:
US$0.80/lb copper, US$350/oz gold, US$4.50/lb molybdenum, and assuming 100% metallurgical recoveries.

There has been no discount for metallurgical recovery in contained metal figures.

Carmacks Copper Project (Yukon, Canada)

The Carmacks Copper Project is located 220 kilometres north of Whitehorse, Yukon.

In 2007, Western Copper reported the key findings of its feasibility study on the project and announced that the study sup-
ports the development of the mine. Based on the proven and probable reserve estimate of 10.6 million tonnes, the mine
has an estimated six year ore production life. The feasibility study indicated initial capital development costs of $144 million,
including a contingency of $14.1 million. An additional sum of $7.3 million is attributable to owner’s costs, which include the
Company’s project team salaries, spare parts, and bond costs. The life-of-mine operating costs were estimated to be $0.98/
lb. of copper (US$0.84/lb. of copper at 0.85 US$/$). Using a copper price of US$2.32 per pound and an exchange rate of 0.85
US$/$, the feasibility study indicated a pre-tax IRR of 21.1% for the project.

MANAGEMENT DISCUSSION & ANALYSIS

2010 ANNUAL REPORT

In April 2009, Western Copper received the Quartz Mining License (“QML”) for the Carmacks Copper Project. This license
permits the Company to begin construction of the Carmacks Copper Mine and establishes many of the terms and conditions
under which the mine will operate.

The Water Use License (“WUL”) is the next and final permit required to build and operate the Carmacks Copper Project.

On May 10, 2010, Western Copper was notified by the Yukon Water Board (“Water Board”) that the Carmacks Copper
Project would not receive the WUL under the current application. The Company subsequently filed a Petition with the Yukon
Supreme Court appealing certain aspects the Water Board decision in order to clarify the rules it would have to follow to reap-
ply for a Water Use License. The appeal hearing concluded on December 9, 2010.

On February 24, 2011, the Yukon Supreme Court ruled that the Water Board is not required to accept the findings of the
YESAB which concluded that the project can be built and operated without significant environmental effect. Western Copper
is considering the decision and will review its options before submitting a new WUL application.

Any production from the Carmacks Copper Project is subject to either a 15% net profits interest or a 3% net smelter royalty,
at Western Copper’s election. If Western Copper elects the net smelter royalty, it has the right to purchase the royalty for
$2.5 million, less any advance royalty payments made to that date. The Company is required to make an advance royalty
payment of $100,000 for any year in which the average daily copper price reported by the London Metal Exchange is US$1.10
per pound or greater. As at the date of this report, Western Copper has made $800,000 in advance royalty payments.

Island Copper (British Columbia, Canada)

The Island Copper property consists of three blocks of mineral claims in a prospective copper-gold porphyry belt located on
northern Vancouver Island, approximately 25 kilometres west of Port Hardy and 360 kilometres northwest of Vancouver, Brit-
ish Columbia. The mineral claim blocks are referred to as the Hushamu claims, the Apple Bay claims, and the Rupert Block.

In 2008, Western Copper exercised its option on the Apple Bay claims and now owns 100% interest in all three mineral claim
blocks that comprise the Island Copper property. An unrelated third party maintains the right to explore the Apple Bay claims
for non-metallic minerals.

From August 2008 to July 2010, the Island Copper property was under option, most recently with Kobex Minerals Inc. (“Ko-
bex”). On July 15, 2010, Kobex terminated its rights to earn-in to the property.

In 2011, Western Copper intends to restart exploration activities at the Island Copper property. The program will likely include
geophysical surveying and drilling.

Should a production decision be made on the Hushamu claims, Western Copper is required to make a cash payment of $1
million to an unrelated third party within 60 days of the production decision. These mineral claims are also subject to a 10%
net profits interest.

Should a production decision be made on the Apple Bay claims, Western Copper is required to pay $800,000 in cash or in
Western Copper stock to an unrelated third party. The payment method is at the election of Western Copper.

Redstone (Northwest Territories, Canada)

The Redstone property comprises five mining leases and 15 mineral claims in six distinct areas in the Nahanni Mining District
southwest of Norman Wells in the Northwest Territories.

In 2007, the Company signed an agreement with the Mineral Deposits Research Unit at the University of British Columbia
(“MDRU”) to fund a research program that will aim to provide a better understanding of the regional geology and to identify
the areas covered by the Company’s existing claims and leases that offer the most exploration potential.

MDRU spent the summers of 2009 and 2010 collecting data at and around the property. MDRU will continue its research in
2011. The field portion of the research program is expected to conclude in 2011.

MANAGEMENT DISCUSSION & ANALYSIS 21

2010 ANNUAL REPORT

The only area that presently has a NI 43-101 compliant resource estimate is the Coates Lake area. This area consists of the
five mining leases noted above. Should production be initiated at Coates Lake, the five mining leases are subject to a net
smelter royalty of between 3-4% depending on the monthly average of the final daily spot price of copper reported on the
New York Commodities Exchange relating to each production month, as follows:

•

3% if the price is less than, or equal to US$0.75 per pound;

3.5% if the price is greater than US$0.75 per pound, but less than, or equal to US$1.00 per pound; and

4% if the price is greater than US$1.00 per pound.

4. SELECTED QUARTERLY FINANCIAL INFORMATION

The following quarterly information has been extracted from the Company’s unaudited interim consolidated
financial statements.

As at and for the quarter ended

Expressed in Canadian dollars

Loss and comprehensive loss

Loss per share – basic and diluted

31-Dec-10

30-Sep-10

30-Jun-10

31-Mar-10

665,986

573,719

775,448

761,826

0.01

Mineral properties

85,330,161

84,307,328

80,893,851

75,376,844

Cash, cash equivalents, and short-term investments

23,636,895

3,728,713

8,232,576

10,798,525

Total assets

109,377,291

88,500,931

89,688,423

87,003,474

As at and for the quarter ended

Expressed in Canadian dollars

Loss and comprehensive loss

Loss per share – basic and diluted

31-Dec-09

30-Sep-09

30-Jun-09

31-Mar-09

233,672

509,122

594,590

522,773

–

0.01

Mineral properties

72,790,644

70,960,998

67,117,675

65,970,008

Cash, cash equivalents, and short-term investments

13,667,179

11,786,066

10,931,098

12,177,922

Total assets

86,876,176

83,316,052

78,478,161

78,503,650

The quarterly fluctuations are due to the following:

Loss and Comprehensive Loss

The loss for the three months ended December 31, 2010 is in-line with the loss figures from September 30, 2010 and from
March 31, 2009 to September 30, 2009. This is the approximate loss figure expected on a quarterly basis.

Loss and comprehensive loss is higher for the quarter ended June 30, 2010 than the previous quarters due to payments
relating to changes in management.

Loss and comprehensive loss is higher during the period ended March 31, 2010 than the previous quarters because Western
Copper issued and donated common shares in February 2010. The fair value of the common shares totaled $117,900 and
was recorded as an office and administration expense.

Loss and comprehensive loss for the quarter ended December 31, 2009 is lower than the other quarters due to a future
income tax recovery of $396,000 recorded during the quarter.

MANAGEMENT DISCUSSION & ANALYSIS

2010 ANNUAL REPORT

Mineral Properties

The Company continues to incur expenditures that add value to its mineral properties. As a result, the carrying value of the
mineral properties has increased in every quarter presented above.

Cash, Cash Equivalents, and Short-term Investments

Cash is being spent to fund ongoing operations and to increase the value of the Company’s mineral properties. This has led
to a decrease in cash, cash equivalents and short-term investments in the quarters presented above with the exception of the
three months ended September 30, 2009, December 31, 2009, and December 31, 2010. Cash, cash equivalents and short-
term investments increased in those quarters because the Company raised funds through private placements and public
financings. The Company raised gross proceeds of $9.4 million and $23 million in 2009 and in 2010, respectively.

Total Assets

Because most dollars spent are capitalized to mineral properties, there has been no significant impact on total assets unless
there is a financing. Total assets increased significantly in quarters when a financing occurred. Otherwise, the figure has
remained relatively constant in all quarters presented.

5. RESULTS OF OPERATIONS

For the quarter ended December 31,

Expressed in Canadian dollars

ADMINISTRATIVE EXPENSES

Accounting and legal

Filing and regulatory fees

Office and administration

Shareholder communication

2010

2009

2008

173,422

196,078

400,035

80,882

72,728

78,101

2,116,235

1,800,325

1,921,138

462,391

414,303

354,521

LOSS BEFORE TAXES AND OTHER ITEMS

2,832,930

2,483,434

2,753,795

OTHER ITEMS

Foreign exchange

Interest income

Write-off of mineral properties

1,735

10,786

51,731

(57,686)

(238,166)

(599,575)

–

405,001

LOSS BEFORE TAXES

2,776,979

2,256,054

2,610,952

Future income tax recovery

–

(395,897)

(451,703)

LOSS AND COMPREHENSIVE LOSS

2,776,979

1,860,157

2,159,249

MANAGEMENT DISCUSSION & ANALYSIS 23

2010 ANNUAL REPORT

Western Copper had a loss of $2.78 million ($0.03 per common share) for the year ended December 31, 2010 compared to a
loss of $1.86 million ($0.02 per common share) in for the year ended December 31, 2009. Although the scale and nature of
the Company’s administrative activity have remained consistent throughout 2009 and 2010, there are a number of items that
have led to differences in the loss and comprehensive loss figures.

Western Copper recorded a future income tax recovery of $396,000 in 2009 as a result of changes in future tax rates. There
was no such recovery in 2010.

Decreasing cash and short-term investment balances and lower interest rates led to a decline in interest income of $180,000
in 2010 as compared to 2009. Western Copper earns interest on its short-term investments, but as the Company uses its
working capital to fund operations and mineral property development, its interest bearing balances decrease, leading to lower
interest income until the Company’s next financing. Western Copper raised approximately $23 million in gross proceeds in
December 2010. As a result, interest income is expected to increase slightly in 2011.

In February 2010, Western Copper made a donation of 90,000 common shares to the University of British Columbia’s Earth
Systems Science Building. The fair value of the common shares totaled $117,900 and was recorded as an office and admin-
istration expense. There was no such expense in 2009.

For the quarter ended December 31,

Expressed in Canadian dollars

ADMINISTRATIVE EXPENSES

Accounting and legal

Filing and regulatory fees

Office and administration

Shareholder communication

2010

2009

34,644

36,949

4,552

6,655

541,119

482,521

99,662

143,528

LOSS BEFORE TAXES AND OTHER ITEMS

679,977

669,653

OTHER ITEMS

Foreign exchange

Interest income

430

243

(14,421)

(40,327)

LOSS BEFORE TAXES

665,986

629,569

Future income tax recovery

–

(395,897)

LOSS AND COMPREHENSIVE LOSS

665,986

233,672

Western Copper had a loss of $666,000 ($0.01 per common share) for the three months ended December 31, 2010. For the
same period in 2009, the Company had a loss of $234,000 (less than $0.01 per common share).

The most significant reason for the difference is the future income tax recovery recorded in 2009 as a result of a change in
future tax rates. There is no such expense in 2010.

MANAGEMENT DISCUSSION & ANALYSIS

2010 ANNUAL REPORT

6. LIQUIDITY AND CAPITAL RESOURCES

For the year ended December 31,

Expressed in Canadian dollars

CASH PROVIDED BY (USED IN)

Operating activities

Financing activities

Investing activities

2010

2009

2008

(2,339,148)

(1,793,475)

(1,735,717)

24,784,204

8,956,411

500

(24,250,489)

(8,764,009)

(16,954,526)

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

(1,805,433)

(1,601,073)

(18,689,743)

Cash and cash equivalents – beginning of the year

3,436,131

5,037,204

23,726,947

CASH AND CASH EQUIVALENTS – ENDING

1,630,698

3,436,131

5,037,204

In addition to its cash and cash equivalents, the Company had $22 million in short-term investments at year-end. As at
December 31, 2010, cash, cash equivalents, and short-term investments total $23.6 million. As at December 31, 2009,
cash, cash equivalents, and short-term investments total $13.7 million. The figure increased $10 million in 2010 because of
the Company raised net proceeds of $21.6 million on December 22, 2010 and received $2.5 million as a result of warrants
exercised in 2010 while spending approximately $15 million on exploration and development costs and administrative
expenses. Net proceeds from financing activities only totaled $9.0 million in 2009.

Cash and cash equivalents comprise cash deposits held at banks. Short-term investments consist of Guaranteed Investment
Certificates (“GIC”) from Canadian chartered banks that are cashable at the Company’s discretion without penalty.

Western Copper is an exploration stage enterprise. As at December 31, 2010, the Company has not earned any production
revenue. It depends heavily on its working capital balance and its ability to raise funds through capital markets to finance its
operations.

Based on its current estimates, management expects that Western Copper will have sufficient working capital to fund its
administrative expenses and its mineral property costs in 2011. The Company will have to raise significant additional capital
in order to build any of its projects.

The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and
the satisfaction of liabilities in the normal course of business. The Company’s ability to continue as a going concern is
substantially dependent on its ability to raise funds necessary to acquire assets, perform exploration and development
activities, and conduct its corporate affairs primarily through the issuance of its common shares. There is a risk that in the
future the Company may not be able to raise the capital required to fund operations. .

Operating Activities

The significant components of operating activities are discussed in the Results of Operations section above.

Financing Activities

On December 22, 2010, Western Copper raised gross proceeds of $23 million dollars by issuing 9,395,500 units at a price of
$2.45. Each unit comprised one common share of the Company and half of one warrant.

MANAGEMENT DISCUSSION & ANALYSIS 25

2010 ANNUAL REPORT

On July 10, 2009, the Company issued 4 million units at a price of $1.00 per unit. Each unit comprised one flow-through
common share and half of one warrant. On December 4, 2009, the Company issued 2.15 million units at a price of $2.50 per
unit. Each unit comprised one flow-through common share and a whole warrant.

In May 2010, the expiration date of the investor warrants issued as part of the July 2009 private placement was accelerated
from July 2012 to June 2010. As a result, Western Copper received $2.46 million from the exercise of 1,964,000 warrants
during the year ended December 31, 2010. During the year ended December 31, 2009, the Company received $251,000
from the exercise of broker warrants relating to the July 2009 financing.

The Company received $695,000 from the exercise of stock options during the year ended December 31, 2010. During the
year ended December 31, 2009, Western Copper received $107,000 from the exercise of stock options. The amount of
stock options exercised increased in 2010 when compared to the previous year due to the timing of stock option expiry dates
and an increase in Western Copper’s share price during the second half of 2010.

Investing Activities

Investing activities include both mineral property expenditures and purchases of short-term investments. In December, the
Company transferred approximately $20 million received from the financing into short-term investments from cash and cash
equivalents. Until the December transfer, the Company had divested $8 million in short-term investments in 2010 to pay for
the exploration and on-going permitting activities at the Casino Project. In 2009, the Company purchased $2.23 million in
short-term investments

The Company expended $12.5 million on mineral property expenditures during 2010. This compares with $6.5 million during
2009. The majority of these costs were spent on the exploration and permitting programs at the Casino Project. The scope
of both of these programs was twice as much in 2010 compared to 2009.

A summary of activities relating to each project is available under the Property Overview section at the beginning of this
document.

7. CONTRACTUAL OBLIGATIONS

The Company leases office space in Vancouver, British Columbia and Whitehorse, Yukon. The future minimum lease pay-
ments by calendar year are approximately as follows:

Expressed in Canadian Dollars

Vancouver

Whitehorse

2011

2012

2013

2014

Thereafter

TOTAL

210,288

212,313

215,149

90,489

28,635

728,239

28,635

Western Copper has no debt and does not pay dividends.

The Company has no material off-balance sheet arrangements, no material capital lease agreements and no material long
term obligations other than those described above or in the description of mineral properties contained in the consolidated
financial statements.

Neither the Company nor any of its subsidiaries has any externally imposed capital requirements.

MANAGEMENT DISCUSSION & ANALYSIS

2010 ANNUAL REPORT

8. SIGNIFICANT ACCOUNTING ESTIMATES

Use of Estimates

The preparation of the consolidated financial statements in conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the amounts reported in the financial statements and the
related notes. Significant areas where management’s judgment is applied include the assessment of impairment to the
carrying value of mineral properties, the determination of the likelihood that future income tax benefits can be realized, the
assumptions used to calculate the fair value of warrants and stock options, amounts and likelihood of contingent liabilities,
and the cost allocation methodologies used to determine results of operations, the value of financing components, and the
value of purchased assets. Actual results could differ from the estimates by a material amount.

Mineral Properties

Direct costs related to the acquisition, exploration, and development of mineral properties owned or controlled by the
Company are deferred on an individual property basis until the viability of a property is determined or until the property is
sold, abandoned, placed into production or determined to be impaired. Administration costs and general exploration costs are
expensed as incurred. If a property is placed into commercial production, deferred costs will be amortized using the unit-of
production method based on proven and probable reserves. The carrying amount for mineral properties represents costs net
of write-downs to date and does not necessarily reflect present or future values. Recovery of capitalized costs is dependent
on successful development of economic mining operations or the disposition of the related mineral properties.

The Company reviews the carrying value of mineral properties when there are events or changes in circumstances that
may indicate impairment. Where estimates of future cash flows are available, an impairment charge is recorded if the
undiscounted future net cash flows expected to be earned from the property are less than the carrying amount. Reductions
in the carrying value of properties are recorded to the extent the net book value of the property exceeds management’s
estimate of fair values.

Fair value is determined with reference to discounted estimated future cash flow analysis or on recent transactions involving
dispositions of similar properties.

The estimated cash flows used to assess recoverability of certain of the Company’s mineral property carrying values
are developed using management’s projections for long-term average copper, gold and molybdenum prices, recoverable
reserves, operating costs, capital expenditures, reclamation costs, and applicable foreign currency exchange rates.
Management makes estimates relating to current and future market conditions. There are inherent uncertainties related to
these factors and management’s judgment when using them to assess mineral property recoverability.

The Company believes that the estimates applied in the impairment assessment are reasonable; however such estimates are
subject to significant uncertainties and judgments. Although management has made its best estimate of these factors based
on current conditions, it is possible that the underlying assumptions can change significantly and impairment charges may be
required in future periods. Such charges could be material.

Asset Retirement Obligation

The fair value of a liability for an asset retirement obligation (“ARO”), such as site closure and reclamation costs, is
recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. The Company is required
to record the estimated present value of future cash flows associated with site closure and reclamation as a long-term
liability and increase the carrying value of the related assets for that amount. Subsequently, these asset retirement costs will
be amortized to expense over the life of the related assets. At the end of each period, the liability is revised to reflect the
passage of time and changes in the estimated future cash flows underlying any initial fair value measurements.

Minimum standards for site reclamation have been established by various governmental agencies that affect certain
operations of the Company. The determination of reclamation costs requires assumptions with respect to future expected
costs and legislation in effect at that time. Changes in these assumptions could have a material effect on the amount
required to be recognized as an ARO.

MANAGEMENT DISCUSSION & ANALYSIS 27

2010 ANNUAL REPORT

Income Taxes

Income taxes are calculated using the liability method of accounting. Temporary differences arising from the difference
between the tax basis of an asset or liability and its carrying amount on the balance sheet are used to calculate future income
tax liabilities or assets. Future income tax assets and liabilities are measured using enacted or substantively enacted tax rates
and laws that are expected to apply when the temporary differences are likely to reverse. When the future realization of
income tax assets does not meet the test of being more likely than not to be realized, a valuation allowance in the amount of
the potential future benefit is recorded and no net asset is recognized. Changes to income tax rules, interpretations, or rates
could have a material impact on amounts recorded in the financial statements.

Stock-based Compensation and Warrant Valuation

The fair value of stock-based compensation awards and warrant issuances is calculated using the Black-Scholes option pricing
model. Option pricing models require the input of highly subjective assumptions including the expected price volatility.
Changes in the subjective input assumptions can materially affect the fair value estimate, and therefore the existing models
do not necessarily provide a reliable single measure of the fair value of stock options granted and warrants issued by the
Company.

9. CHANGE IN ACCOUNTING POLICIES

The Company has elected to adopt the following standards effective January 1, 2010 so that its accounting policies are more
closely aligned with International Financial Reporting Standards during the year ending December 31, 2010.

Business Combinations

Section 1582, Business Combinations, replaces Section 1581, Business Combinations and establishes standards for the ac-
counting for business combinations. It provides the Canadian equivalent to International Financial Reporting Standard IFRS 3,
Business Combinations. The section applies prospectively to business combinations for which the acquisition date is on or
after the beginning of the first annual reporting period after adoption.

Consolidated Financial Statements and Non-Controlling Interests

Section 1601, Consolidated Financial Statements, and Section 1602, Non-Controlling Interests, replace Section 1600,
Consolidated Financial Statements. Section 1601 establishes standards for the preparation of consolidated financial
statements. Section 1602 establishes standards for accounting for a non-controlling interest in a subsidiary in consolidated
financial statements subsequent to a business combination. It is equivalent to the corresponding provisions of International
Financial Reporting Standard IAS 27, Consolidated and Separate Financial Statements. The adoption of this standard had no
effect on the Company’s financial statements.

10. INTERNATIONAL FINANCIAL REPORTING STANDARDS (“IFRS”)

Western Copper expects to adopt IFRS effective January 1, 2011. In 2011, the Company will have to report 2010 comparative
figures restated using IFRS for each comparative period after the transition date.

Western Copper has compared its current accounting policies under Canadian Generally Accepted Accounting Principles
(“GAAP”) to IFRS and identified differences between the two standards. Based on its review of historical transactions and
current business activities, the Company has identified the treatment of exploration and evaluation (“E&E”) costs, income
taxes, and asset impairment as areas with the greatest potential to create significant differences in the Company’s financial
statements as a result of adopting IFRS.

MANAGEMENT DISCUSSION & ANALYSIS

2010 ANNUAL REPORT

Western Copper performed a comprehensive analysis of the areas noted above to determine the potential impact that
adopting IFRS will have on the Company’s financial statements.

IFRS 6 allows companies to choose a policy that capitalizes E&E costs. The Company expects to continue capitalizing its E&E
costs in a manner consistent with its current accounting policy.

The method of accounting for income taxes under IFRS is similar to Canadian GAAP, but one of the differences under IFRS is
expected to have a significant impact on the Company’s financial reporting. Current IFRS guidelines prohibit the recognition
of future income tax (“FIT”) assets or liabilities that arise from the initial recognition of assets or liabilities that do not impact
profit or loss and that occur other than in a business combination. The majority of the Company’s FIT liability balance is due
to the difference between the carrying value and the tax value of the properties that Western Copper acquired through its
purchase of Lumina Resources Corp. in 2006. Western Copper accounted for the transaction as an acquisition of assets,
not as a business combination. As a result of the rule noted above, the FIT liability balance recognized under Canadian GAAP
would be eliminated. This would also decrease the carrying value of mineral properties by a similar amount because when
the FIT liability was recognized, the carrying values of the related mineral properties were grossed up by the same amount.

Under Canadian GAAP, mineral property impairment testing is performed using a two-step test. The first step is to determine
if there is an impairment loss by using an undiscounted cash flow analysis. If that analysis identifies an impairment loss, the
loss is measured as the amount by which carrying value exceeds fair value. The fair value is often based on discounted cash
flows. Under IFRS, assets are tested for impairment using a one-step process based on discounted cash flows. IFRS also
allow the reversal of impairment charges from previous years if the fair value exceeds the carrying value of long-lived assets.
Western Copper does not anticipate that the adoption of the IFRS in regards to mineral property impairment will have a
material impact on the carrying value of its mineral properties.

Other IFRS that apply to the Company’s operations, but that are not expected to have a significant effect on 2010 financial
results based on the Company’s activities are functional currency, business combinations, share based payments, and
decommissioning and retirement obligations.

The Company has performed its review of IFRS based on standards applicable as of the date of this report. The International
Accounting Standards Board is still developing IFRS and may propose changes to the standards between the date of this
report and the date the Company adopts IFRS. Changes to IFRS could have material effects on Western Copper’s analysis
discussed above.

The SEC has announced that it will not require a financial statements prepared in accordance with IFRS to be reconciled to
accounting principles generally accepted in the United States (“US GAAP”). As a result, the Company’s annual consolidated
financial statements for the year ended December 31, 2011 are not expected to include a US GAAP reconciliation note.

Western Copper does not expect the adoption of IFRS to have a significant impact on its information technology and data
systems, internal control over financial reporting, or disclosure controls and procedures. Employees who have accounting
responsibilities have received IFRS specific training. The Company’s directors have been provided with an overview of IFRS.

11. DISCLOSURE CONTROLS AND PROCEDURES

Management is responsible for designing, establishing, and maintaining a system of disclosure controls and procedures.
Disclosure controls and procedures are designed to provide reasonable assurance that material information relating to the
Company is made known to management, particularly during the period in which the annual filings are being prepared
and that information required to be disclosed by the Company in its annual filings, interim filings or other reports filed
or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods
specified in securities legislation.

As a result of the material weakness identified during the assessment of internal control over financial reporting, as described
below, management has also concluded that its disclosure controls and procedures were not effective as at December 31, 2010.

MANAGEMENT DISCUSSION & ANALYSIS 29

2010 ANNUAL REPORT

12. MANAGEMENT’S REPORT ON INTERNAL CONTROLS OVER
FINANCIAL REPORTING AND DISCLOSURE CONTROLS

Management is responsible for designing, establishing, and maintaining a system of internal control over financial reporting
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with the Company’s generally accepted accounting principles.

The Chief Executive Officer and the Chief Financial Officer evaluated the effectiveness of the Company’s disclosure controls
and procedures and assessed the design and the operating effectiveness of the Company’s internal control over financial
reporting as of December 31, 2010.

Based on that assessment, management concluded that, as at December 31, 2010, the Company’s internal control over
financial reporting was not effective due to the existence of a material weakness. A material weakness existed in the design
of internal control over financial reporting caused by a lack of adequate segregation of duties in the financial close process.
The Chief Financial Officer is responsible for preparing, authorizing, and reviewing information that is key to the preparation
of financial reports. He is also responsible for preparing and reviewing the resulting financial reports. This weakness has the
potential to result in material misstatements in the Company’s financial statements, and should also be considered a material
weakness in its disclosure controls and procedures.

Management has concluded, and the audit committee has agreed that taking into account the present stage of Western
Copper’s development, the Company does not have sufficient size and scale to warrant the hiring of additional staff to correct
the weakness at this time.

There has been no significant change in internal control over financial reporting or in disclosure controls and procedures from
October 1 to December 31, 2010 that has materially affected, or is reasonably likely to affect, the Company’s its internal
control over financial reporting or its disclosure controls and procedures.

13. FINANCIAL INSTRUMENT RISK

The Board of Directors has overall responsibility for the establishment and oversight of the Company’s risk management
framework. The Company has exposure to credit, liquidity, currency, interest rate and market risks from the use of financial
instruments. Financial instruments consist of cash and cash equivalents, short-term investments, other receivables,
reclamation bonds, and accounts payable and accrued liabilities.

Market Risk

The Company does not generate cash from its operating activities. Its principal source of funds is the issuance of common
shares. It uses the capital raised from the issuance of its common shares to explore and develop its mineral properties with
the goal of increasing the price of the Company’s common shares. Western Copper’s common shares are publicly traded.
As such, the price of its common shares is susceptible to factors beyond management’s control including, but not limited
to, fluctuations in commodity prices and foreign exchange rates and changes in the general market outlook. Should Western
Copper require funds during a time when the price of its common shares is depressed, the Company may be required to
accept significant dilution to maintain enough liquidity to continue operations or may be unable to raise sufficient capital to
meet its obligations. The Company’s contractual obligations are described in the Property Overview and the Contractual
Obligations sections of this report

Liquidity Risk

Liquidity risk is the risk that the Company will be unable to meet its financial obligations as they come due. The Company
uses cash forecasts to ensure as far as possible that there is sufficient cash on hand to meet short-term business
requirements. Cash is invested in highly liquid investments which are available to discharge obligations when they come due.
The Company does not maintain a line of credit.

MANAGEMENT DISCUSSION & ANALYSIS

2010 ANNUAL REPORT

Credit Risk

Financial instruments that potentially subject the Company to credit risk consist primarily of cash and cash equivalents and
short-term investments. These financial instruments are at risk to the extent that the institutions issuing or holding them
cannot redeem amounts when they are due or requested. To limit its credit risk, the Company uses a restrictive investment
policy. It deposits cash and cash equivalents in Canadian chartered banks and purchases short-term investments that are
guaranteed by Canadian governments or by Canadian chartered banks.

Currency Risk

Currency risk is the risk that the Company will lose significant purchasing power to operate its business as a result of
changes in currency rates. The Company raises funds in Canadian dollars. The majority of the Company’s expenditures are
incurred in Canadian dollars. To limit its exposure to currency risk, the Company maintains the majority of its cash and cash
equivalents in Canadian dollars. The Company did not have a material amount of financial instruments denominated in foreign
currencies as at December 31, 2010 or December 31, 2009.

Interest Rate Risk

The Company is exposed to interest rate risk on its cash and cash equivalents and its short-term investments to the extent
that the institutions that hold or issue those instruments cannot pay the interest earned on them by Western Copper.
Potential losses in interest income would not have a material impact on the Company’s results of operations.

CAUTIONARY NOTES

Forward-looking statements

This Management’s Discussion and Analysis contains certain forward-looking statements concerning anticipated developments in Western Copper’s operations in future
periods. Statements that are not historical fact are forward-looking statements as that term is defined in the United States Private Securities Litigation Reform Act of
1995 and forward looking information as that term is defined in National Instrument 51-102 (“NI 51-102”) of the Canadian Securities Administrators. Certain forward
looking information should also be considered future-oriented financial information (“FOFI”) as that term is defined in NI 51-102. The purpose of disclosing FOFI is
to provide a general overview of management’s expectations regarding the anticipated results of planned 2011 operations and capital expenditures. Forward-looking
statements and information (referred to herein together as “forward-looking statements”) are frequently, but not always, identified by words such as “expects”,
“anticipates”, “believes”, “intends”, “estimates”, “potential”, “possible” and similar expressions, or statements that events, conditions or results “will”, “may”,
“could” or “should” occur or be achieved. These forward-looking statements are set forth principally under the heading “Property Overview”, “Quarterly Summary of
Activities” and elsewhere in Management’s Discussion and Analysis and may include statements regarding perceived merit of properties; mineral reserve and resource
estimates; capital expenditures; feasibility study results, ability to obtain required permits for the construction and operation of the Carmacks Copper Project; exploration
results at the Company’s properties; budgets; work programs; timelines; strategic plans; market price of precious and base metals; or other statements that are not
statement of fact. The material factors or assumptions used to develop forward-looking statements include prevailing and projected market prices and foreign exchange
rates, exploitation and exploration estimates and results, continued availability of capital and financing, and general economic, market or business conditions and as more
specifically disclosed throughout this document. Forward-looking statements are statements about the future and are inherently uncertain, and actual achievements of
Western Copper and its subsidiaries may differ materially from those reflected in the forward-looking statements due to a variety of risks, uncertainties and other factors.

Western Copper’s forward-looking statements are based on the beliefs, expectations and opinions of management on the date the statements are made, and Western
Copper does not assume any obligation to update forward-looking statements if circumstances or management’s beliefs, expectations or opinions should change except
as required by law. For the reasons set forth above, investors should not place undue reliance on forward-looking statements. Important factors that could cause actual
results to differ materially from Western Copper’s expectations include uncertainties involved in fluctuations in gold, copper and other commodity prices and currency
exchange rates; uncertainties relating to interpretation of drill results and the geology, continuity and grade of mineral deposits; uncertainty of estimates of capital and
operating costs, recovery rates, production estimates and estimated economic return; the need for cooperation of government agencies and First Nations in the exploration
and development of properties and the issuance of required permits; the need to obtain additional financing to develop properties and uncertainty as to the availability
and terms of future financing; the possibility of delay in exploration or development programs or in construction projects and uncertainty of meeting anticipated program
milestones; uncertainty as to timely availability of permits and other governmental approvals; and other risks and uncertainties disclosed in Western Copper’s Annual
Information Form, Western Copper’s annual report on Form 40-F, and other information released by Western Copper and filed with the applicable regulatory agencies.

Cautionary note to U.S. investors

The terms “measured mineral resource”, “indicated mineral resource”, and “inferred mineral resource” used in this management discussion and analysis are Canadian
geological and mining terms as defined in accordance with National Instrument 43-101, Standards of Disclosure for Mineral Projects (“NI 43-101”) under the guidelines
set out in the Canadian Institute of Mining, Metallurgy and Petroleum (the CIM) Standards on Mineral Resources and Mineral Reserves. We advise U.S. investors that
while such terms are recognized and required under Canadian regulations, the SEC does not recognize them. “Inferred mineral resources” in particular have a great
amount of uncertainty as to their existence, and great uncertainty as to their feasibility. It cannot be assumed that all or any part of an inferred mineral resource will
ever be upgraded to a higher category. Under Canadian rules estimates of inferred mineral resources may not generally form the basis of feasibility or other economic
studies. U.S. investors are cautioned not to assume that any part of an inferred mineral resource exists, or is economically or legally mineable. Disclosure of contained
metal expressed is in compliance with NI 43-101, but does not meet the requirements of Industry Guide 7 of the SEC, which will only accept the disclosure of tonnage
and grade estimates for non-reserve mineralization.

MANAGEMENT DISCUSSION & ANALYSIS 31

2010 ANNUAL REPORT

Financial
sTaTemenTs

CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS

1. Nature of Operations

2. Accounting Policies

3. Short-Term Investments

4. Property and Equipment

5. Mineral Properties

6. Share Capital and Contributed Surplus

7. Warrants and Stock Options

8. Stock-Based Compensation

9. Commitments

10. Segmented Information

11. Capital Management

12. Financial Instrument Risk

13. Supplemental Cash Flow Information

14. Income Taxes

15. Material Differences Between Canadian
and United States Generally Accepted
Accounting Principles (GAAP)

financial statementsmanagemenT’s ResponsibiliTy
FoR Financial RepoRTing

The accompanying consolidated financial statements of the Company have been prepared by management in accordance
with accounting principles generally accepted in Canada and reconciled to accounting principles generally accepted in the
United States as set out in note 15 and contain estimates based on management’s judgment.

Management maintains an appropriate system of internal control to provide reasonable assurance that assets are
safeguarded, transactions are properly authorized and recorded, and proper records are maintained. Further information
on the company’s internal control over financial reporting and its disclosure controls is available in management’s report on
internal control, which follows.

The Audit Committee of the Board of Directors has met with the Company’s independent auditors to review the scope and
results of the annual audit and to review the consolidated financial statements and related financial reporting matters prior to
submitting the consolidated financial statements to the Board of Directors for approval.

The Company’s independent auditors, PricewaterhouseCoopers LLP, have audited the Company’s consolidated financial
statements on behalf of the shareholders and their report follows.

Julien François
Chief Financial Officer
March 24, 2011

Dale Corman
Chief Executive Officer
March 24, 2011

CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

managemenT’s RepoRT on inTeRnal
conTRol oveR Financial RepoRTing

The management of Western Copper Corporation is responsible for establishing and maintaining an adequate internal control
over financial reporting. The Securities and Exchange Act of 1934 in Rule 13a-15(f) and 15d-15(f) defines this as a process
designed by, or under the supervision of, the Company’s principal executive and principal financial officers and effected by the
Company’s Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted
accounting principles, and includes those policies and procedures that:

•

Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transaction and
dispositions of the assets of the Company;

Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the
Company are being made only in accordance with authorizations of management and directors of Company; and

•

Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisitions, use or disposition
of the Company’s assets that may have a material effect on the consolidated financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect all misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of the Company’s internal control over financial reporting as at December 31, 2010.
In making this assessment, the Company’s management used the criteria established by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO) in its Internal Control-Integrated Framework.

During the year ended December 31, 2010, and to the date of this report, there has been no change to internal controls that
would have a material effect on internal controls over financial reporting.

Based on our assessment, management has concluded that, as at December 31, 2010, the Company‘s internal control over
financial reporting was not effective due to the existence of a material weakness. A material weakness existed in the design
of internal control over financial reporting caused by a lack of adequate segregation of duties in the financial close process.
The Chief Financial Officer is responsible for preparing, authorizing, and reviewing information that is key to the preparation
of financial reports. He is also responsible for preparing and reviewing the resulting financial reports. This weakness has the
potential to result in material misstatements in the Company’s financial statements, and should also be considered a material
weakness in its disclosure controls and procedures.

Management has concluded, and the Audit Committee has agreed that taking into account the present stage of Western
Copper’s development, the Company does not have sufficient size and scale to warrant the hiring of additional staff to correct
the weakness at this time.

The effectiveness of the Company’s internal control over financial reporting has been audited by the independent auditors,
PricewaterhouseCoopers LLP, as stated in their attestation report, which is included herein.

Julien François
Chief Financial Officer
March 24, 2011

Dale Corman
Chief Executive Officer
March 24, 2011

CONSOLIDATED FINANCIAL STATEMENTS 35

2010 ANNUAL REPORT

independenT audiToRs’ RepoRT

To the Shareholders of Western Copper Corporation

We have completed integrated audits of Western Copper Corporation’s 2010, 2009 and 2008 consolidated financial
statements and an audit of the effectiveness of internal control over financial reporting as at December 31, 2010. Our
opinions, based on our audits, are presented below.

Report on the consolidated financial statements
We have audited the accompanying consolidated financial statements of Western Copper Corporation, which comprise the
consolidated balance sheets as at December 31, 2010 and December 31, 2009 and the consolidated statements of loss
and comprehensive loss, cash flow and shareholders’ equity for each of the years in the three year period ended Decem-
ber 31, 2010, and the related notes.

Management’s responsibility for the consolidated financial statements

Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance
with Canadian generally accepted accounting principles and for such internal control as management determines is necessary
to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud
or error.

Auditor’s responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted
our audits in accordance with Canadian generally accepted auditing standards and the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan and perform an audit to obtain reasonable
assurance about whether the consolidated financial statements are free from material misstatement. Canadian generally
accepted auditing standards require that we comply with ethical requirements.

An audit involves performing procedures to obtain audit evidence, on a test basis, about the amounts and disclosures in the
consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of
the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those
risk assessments, the auditor considers internal control relevant to the company’s preparation and fair presentation of the
consolidated financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also
includes evaluating the appropriateness of accounting principles and policies used and the reasonableness of accounting
estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained in our audits is sufficient and appropriate to provide a basis for our audit
opinion on the consolidated financial statements.

Opinion
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of Western
Copper Corporation as at December 31, 2010 and December 31, 2009 and the results of its operations and cash flows
for each of the years in the three year period ended December 31, 2010 in accordance with Canadian generally accepted
accounting principles.

Report on internal control over financial reporting
We have also audited Western Copper Corporation’s internal control over financial reporting as at December 31, 2010, based
on criteria established in Internal Control - Integrated Framework, issued by the Committee of Sponsoring Organizations of
the Treadway Commission (COSO).

Management’s responsibility for internal control over financial reporting
Management is responsible for maintaining effective internal control over financial reporting and for its assessment of the
effectiveness of internal control over financial reporting included in Management’s Report on Internal Control over Financial
Reporting.

CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

Auditor’s responsibility

Our responsibility is to express an opinion on Western Copper Corporation’s internal control over financial reporting based on
our audit. We conducted our audit of internal control over financial reporting in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

An audit of internal control over financial reporting includes obtaining an understanding of internal control over financial
reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness
of internal control, based on the assessed risk, and performing such other procedures as we consider necessary in the
circumstances.

We believe that our audit provides a reasonable basis for our audit opinion on Western Copper Corporation’s internal control
over financial reporting.

Definition of internal control over financial reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures
that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the
company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.

Inherent limitations

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that
there is a reasonable possibility that a material misstatement of the company’s annual financial statements will not be
prevented or detected on a timely basis. As at December 31, 2010 a material weakness, relating to a lack of segregation
of duties in the financial accounting process was identified, as described in Management’s Report on Internal Control over
Financial Reporting.

We considered this material weakness in determining the nature, timing, and extent of audit tests applied in our audit of
the December 31, 2010 consolidated financial statements, and our opinion regarding the effectiveness of Western Copper
Corporation’s internal control over financial reporting does not affect our opinion on those consolidated financial statements.

In our opinion, Western Copper Corporation did not maintain, in all material respects, effective internal control over financial
reporting as at December 31, 2010 based on criteria established in Internal Control - Integrated Framework issued by the
COSO.

We do not express an opinion or any form of assurance on management’s conclusion as to whether the hiring of additional
staff is warranted as included in Management’s Report on Internal Control over Financial Reporting..

Chartered Accountants
Vancouver, British Columbia
March 24, 2011

CONSOLIDATED FINANCIAL STATEMENTS 37

2010 ANNUAL REPORT

CONSOLIDATED BALANCE SHEETS

Expressed in Canadian dollars

ASSETS

CURRENT ASSETS

Cash and cash equivalents

Short-term investments

Other receivables

Prepaid expenses

CURRENT ASSETS

RECLAMATION BOND

PROPERTY AND EQUIPMENT

MINERAL PROPERTIES

ASSETS

LIABILITIES

CURRENT LIABILITIES

Accounts payable and accrued liabilities

FUTURE INCOME TAX

LIABILITIES

SHAREHOLDERS’ EQUITY

SHARE CAPITAL

CONTRIBUTED SURPLUS

DEFICIT

SHAREHOLDERS’ EQUITY

LIABILITIES + SHAREHOLDERS’ EQUITY

Commitments

Approved by the Board of Directors

December 31, 2010 December 31, 2009

Note

1,630,698

22,006,197

131,914

56,638

3,436,131

10,231,048

83,833

44,714

23,825,447

13,795,726

80,300

141,383

80,300

209,506

85,330,161

72,790,644

109,377,291

86,876,176

1,240,539

1,097,409

12,472,501

9,661,846

13,713,040

10,759,255

97,086,083

78,252,251

29,411,940

25,921,463

(30,833,772)

(28,056,793)

95,664,251

76,116,921

109,377,291

86,876,176

–

Robert Gayton, Director

Dale Corman, Director

CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS

For the Year Ended December 31,

Expressed in Canadian dollars

ADMINISTRATIVE EXPENSES

Accounting and legal

Filing and regulatory fees

Office and administration

Shareholder communication

LOSS BEFORE TAXES AND OTHER ITEMS

OTHER ITEMS

Foreign exchange

Interest income

Write-off of mineral properties

LOSS BEFORE TAXES

FUTURE INCOME TAX RECOVERY

2010

2009

2008

173,422

196,078

400,035

80,882

72,728

78,101

2,116,235

1,800,325

1,921,138

462,391

414,303

354,521

2,832,930

2,483,434

2,753,795

1,735

10,786

51,731

(57,686)

(238,166)

(599,575 )

–

405,001

2,776,979

2,256,054

2,610,952

–

(395,897)

(451,703)

Note

–

LOSS AND COMPREHENSIVE LOSS

2,776,979

1,860,157

2,159,249

BASIC AND DILUTED LOSS PER SHARE

0.03

0.02

0.03

WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING

81,128,926

74,897,792

72,792,941

CONSOLIDATED FINANCIAL STATEMENTS 39

2010 ANNUAL REPORT

CONSOLIDATED STATEMENTS OF CASH FLOW

For the Year Ended December 31,

Expressed in Canadian dollars

2010

2009

2008

Cash flows provided by (used in)

Note

OPERATING ACTIVITIES

Loss for the year

ITEMS NOT AFFECTING CASH

Amortization

Donation of common shares

Future income tax recovery

Stock-based compensation

Write-off of mineral properties

ITEMS NOT AFFECTING CASH

–

(2,776,979)

(1,860,157)

(2,159,249)

–

13,417

117,900

33,336

39,603

–

(395,897)

(451,703)

416,877

349,398

–

548,194

(13,163)

425,816

405,001

418,717

Change in non-cash working capital items

(110,363)

79,845

4,815

OPERATING ACTIVITIES

FINANCING ACTIVITIES

Issuance of common shares and warrants

Share issuance costs

Exercise of warrants

Exercise of stock options

FINANCING ACTIVITIES

INVESTING ACTIVITIES

Purchase of short-term investments

Mineral property expenditures

Acquisition of property and equipment

(2,339,148)

(1,793,475)

(1,735,717)

23,018,975

9,375,000

(1,384,514)

(776,422)

2,455,000

694,743

251,250

106,583

24,784,204

8,956,411

–

500

(11,775,000)

(2,225,000)

(8,000,000)

(12,475,489)

(6,539,009)

(8,653,293)

–

(301,233)

–

INVESTING ACTIVITIES

(24,250,489)

(8,764,009)

(16,954,526)

DECREASE IN CASH AND CASH EQUIVALENTS

(1,805,433)

(1,601,073)

(18,689,743)

Cash and cash equivalents - Beginning

3,436,131

5,037,204

23,726,947

CASH AND CASH EQUIVALENTS - ENDING

1,630,698

3,436,131

5,037,204

CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

Expressed in Canadian dollars

DECEMBER 31, 2007

72,769,036

71,883,630

22,091,594

(24,037,387)

69,937,837

Number of
shares

Amount Contributed
surplus

Deficit Shareholders’
equity

Exercise of stock options

50,000

500

–

67,000

(67,000)

Transfer of value on exercise
of stock options

Stock-based compensation

Loss and comprehensive loss

–

(2,159,249)

DECEMBER 31, 2008

72,819,036

71,951,130

22,698,985

(26,196,636)

68,453,479

674,391

–

114,960

813,200

–

Private placement – July 10

4,000,000

Issuance costs

Agent warrants

Investor warrants

–

(355,320)

(114,960)

(813,200)

Private placement – December 4

2,150,000

5,375,000

Issuance costs

Agent warrants

Investor warrants

Exercise of warrants

–

(421,102)

(89,440)

89,440

(1,848,495)

1,848,495

201,000

251,250

–

Transfer of value on exercise of warrants

–

96,279

(96,279)

Exercise of stock options

105,000

106,583

–

Transfer of value on exercise of stock options

Stock-based compensation

Loss and comprehensive loss

–

114,526

(114,526)

567,188

–

Financing – December 22

9,395,500

23,018,975

Issuance costs

Agent warrants

–

(1,700,012)

(4,476,983)

4,476,983

Donation of common shares

90,000

117,900

Issuance costs

Future income tax liability recorded pursu-
ant to 2009 flow-through financings

–

(2,217)

(2,810,655)

Exercise of warrants

1,964,000

2,455,000

–

Transfer of value on exercise of warrants

–

801,386

(801,386)

Exercise of stock options

763,300

694,743

–

Transfer of value on exercise of stock options

Stock-based compensation

Loss and comprehensive loss

–

735,695

(735,695)

550,575

–

500

–

674,391

–

4,000,000

(355,320)

–

5,375,000

(421,102)

–

251,250

–

106,583

–

567,188

–

23,018,975

(1,700,012)

–

117,900

(2,217)

(2,810,655)

2,455,000

–

694,743

–

550,575

DECEMBER 31, 2009

79,275,036

78,252,251

25,921,463

(28,056,793)

76,116,921

–

(1,860,157)

DECEMBER 31, 2010

91,487,836

97,086,083

29,411,940

(30,833,772)

95,664,251

CONSOLIDATED FINANCIAL STATEMENTS 41

2010 ANNUAL REPORT

–

(2,776,979)

noTes To The consolidaTed
Financial sTaTemenTs

1. NATURE OF OPERATIONS

Western Copper Corporation (“Western Copper” or the “Company”) is a mineral exploration company with a primary focus
of advancing its mineral properties towards production. All of Western Copper’s mineral properties are located in Canada.

To date, the Company has not earned any production revenue. The recoverability of the amounts shown for mineral property
assets is dependent upon the existence of economically recoverable reserves and the Company’s ability to secure and
maintain title and beneficial interest in the properties, to obtain the necessary financing to continue the exploration and future
development of the properties, or to realize the carrying amount through a sale.

2. ACCOUNTING POLICIES

a. Significant Accounting Policies

The Company’s consolidated financial statements are prepared in accordance with accounting principles generally accepted

in Canada. As described in note 15, these principles differ in certain material respects from accounting principles generally

accepted in the United States.

i) Use of estimates

The preparation of the consolidated financial statements in conformity with generally accepted accounting principles

requires management to make estimates and assumptions that affect the amounts reported in the financial statements

and the related notes. Significant areas where management’s judgment is applied include the assessment of

impairment to the carrying value of mineral properties, the determination of the likelihood that future income tax

benefits can be realized, the assumptions used to calculate the fair value of warrants and stock options, amounts and

likelihood of contingent liabilities, and the cost allocation methodologies used to determine results of operations, the

value of financing components, and the value of purchased assets. Actual results could differ from the estimates by a

material amount.

ii) Principles of consolidation

These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries: Car-

macks Copper Ltd., Lurprop Holdings Inc., CRS Copper Resources Corp., Moraga Resources Ltd., and Minera Costa de

Plata S.A. de C.V. All intercompany transactions and balances have been eliminated.

iii) Cash and cash equivalents

Cash and cash equivalents comprise cash deposits held at banks and highly liquid investments with original maturity

dates that are less than 90 days from the date of acquisition.

iv) Short-term investments

Short-term investments comprise investments with original maturity dates that are greater than 90 days but no more

than one year from the date of acquisition.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

v) Property and equipment

Property and equipment are carried at cost less accumulated amortization. Amortization is provided on a straight-line

basis over the estimated useful lives of the assets.

Computer equipment

Field equipment

Furniture and office equipment

5 years

Leasehold improvements

over the term of the lease

Vehicles

3 years

vi) Mineral properties

Direct costs related to the acquisition, exploration, and development of mineral properties owned or controlled by

the Company are deferred on an individual property basis until the viability of a property is determined or until the

property is sold, abandoned, placed into production or determined to be impaired. Administration costs and general

exploration costs are expensed as incurred. If a property is placed into commercial production, deferred costs will

be amortized using the unit-of production method based on proven and probable reserves. The carrying amount for

mineral properties represents costs net of write-downs to date and does not necessarily reflect present or future

values. Recovery of capitalized costs is dependent on successful development of economic mining operations or the

disposition of the related mineral properties.

Cost recoveries, including tax credits and funds received as part of government assistance programs, are recognized as

a reduction in the carrying value of the related asset when the money is more likely than not to be received. If the ap-

plicable property has been written-off, the amount received is recorded as a credit to the statement of loss in the period

in which the payment is more likely than not to be received.

Although the Company has taken steps to verify title to mineral properties in which it has an interest, these procedures

do not guarantee the Company’s title. Such properties may be subject to prior agreements or transfers, or title may be

affected by undetected defects.

vii) Impairment of long-lived assets

The Company reviews the carrying value of mineral properties when there are events or changes in circumstances

that may indicate impairment. Where estimates of future cash flows are available, an impairment charge is recorded

if the undiscounted future net cash flows expected to be earned from the property are less than the carrying amount.

Reductions in the carrying value of properties are recorded to the extent the net book value of the property exceeds

management’s estimate of fair values.

Fair value is determined with reference to discounted estimated future cash flow analysis or on recent transactions

involving dispositions of similar properties.

The estimated cash flows used to assess recoverability of certain of the Company’s mineral property carrying values

are developed using management’s projections for long-term average copper, gold and molybdenum prices, recoverable

reserves, operating costs, capital expenditures, reclamation costs, and applicable foreign currency exchange rates.

Management makes estimates relating to current and future market conditions. There are inherent uncertainties related

to these factors and management’s judgment when using them to assess mineral property recoverability.

The Company believes that the estimates applied in the impairment assessment are reasonable; however such

estimates are subject to significant uncertainties and judgments. Although management has made its best estimate of

these factors based on current conditions, it is possible that the underlying assumptions can change significantly and

impairment charges may be required in future periods. Such charges could be material.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 43

2010 ANNUAL REPORT

viii) Asset retirement obligation

The fair value of a liability for an asset retirement obligation (“ARO’s”), such as site closure and reclamation costs, is

recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. The Company is

required to record the estimated present value of future cash flows associated with site closure and reclamation as

a long-term liability and increase the carrying value of the related assets for that amount. Subsequently, these asset

retirement costs will be amortized to expense over the life of the related assets. At the end of each period, the liability

is revised to reflect the passage of time and changes in the estimated future cash flows underlying any initial fair value

measurements.

ix) Translation of foreign currency

Monetary assets and liabilities are translated into Canadian dollars using period-end exchange rates. Non-monetary

items are translated at rates prevailing at acquisition or transaction dates. Expense and other items are translated into

Canadian dollars at the rate of exchange in effect at the date of the related transaction. All exchange gains or losses

arising on translation are included in results of operations.

Income taxes

Income taxes are calculated using the liability method of accounting. Temporary differences arising from the difference

between the tax basis of an asset or liability and its carrying amount on the balance sheet are used to calculate future

income tax liabilities or assets. Future income tax assets and liabilities are measured using enacted or substantively

enacted tax rates and laws that are expected to apply when the temporary differences are likely to reverse. When the

future realization of income tax assets does not meet the test of being more likely than not to be realized, a valuation

allowance in the amount of the potential future benefit is recorded and no net asset is recognized.

xi) Loss per share

Loss per share is calculated using the weighted average number of common shares outstanding during the year. Basic

and diluted loss per share is the same as the effect of the exercise of outstanding stock options and warrants would be

anti-dilutive.

xii) Stock-based compensation

The Company uses the fair value method of accounting for the cost of stock-based compensation granted to

employees, directors, and others. The fair value of stock-based compensation awards is determined at the time of

grant using the Black-Scholes option pricing model.

The costs are charged to the statement of loss or, if appropriate, are capitalized to mineral properties over the stock

option vesting period with a corresponding increase to contributed surplus. The Company’s allocation of stock-based

compensation is consistent with its treatment of other types of compensation for each recipient.

When stock options are exercised, the consideration paid together with the amount previously recognized in

contributed surplus is recorded as an increase to share capital. In the event that stock options are forfeited prior to

vesting, the associated fair value recorded to date is reversed from the statement of loss or balance sheet item to

which the fair value was originally charged in the period in which the stock options are forfeited. The fair value of any

vested stock options that expire remains in contributed surplus.

Option pricing models require the input of highly subjective assumptions including the expected price volatility. Changes

in the subjective input assumptions can materially affect the fair value estimate, and therefore the existing models

do not necessarily provide a reliable single measure of the fair value of the Company’s stock options and/or warrants

granted and/or vested during the period.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

xiii) Share capital

The Company records proceeds from share issuances net of issue costs. Shares issued for consideration other than

cash are valued at the market price on the date of issue.

xiv) Valuation of equity unites issued as part of a financing

The Company has adopted a pro rata basis method for the measurement of shares and warrants issued as units in

financing arrangements. The pro rata basis method requires that gross proceeds and related share issuance costs be

allocated to the common shares and the warrants based on the relative fair value of each component.

The fair value of the common shares is based on the closing price on the closing date of the transaction and the fair

value of the warrants is determined on the closing date of the transaction using the Black-Scholes option pricing model.

The fair value attributed to the warrants is recorded as contributed surplus. If the warrants are exercised, the value

attributable to the warrants is transferred to share capital.

xv) Flow-through common shares

Under the Canadian Income Tax Act, an enterprise may issue securities referred to as flow-through shares. These

instruments permit the Company to renounce, or transfer to the investor the tax deductions associated with an equal

value of qualifying resource expenditures. The Company records a future income tax liability on the date that the Com-

pany files the renouncement documents with the tax authorities, provided that there is reasonable assurance that the

expenditures will be made. At the time of recognition of the future income tax liability, an offsetting reduction to share

capital is made.

xvi) Related party transactions

Related party transactions are measured at the exchange amount.

xvii) Financial instruments

Designation

Western Copper has designated its financial instruments as follows:

•

Cash and cash equivalents, short-term investments, and reclamation bonds are classified as “Held-for-Trading” and
are recorded at their fair value with changes in fair value recorded in the statement of loss;

Other receivables are classified as “Loans and Receivables”. These financial assets are recorded at their amortized
cost using the effective interest method; and

Accounts payable and accrued liabilities are classified as “Other Financial Liabilities”. These financial liabilities are
recorded at their amortized cost using the effective interest method.

Fair value

Due to the short-term nature of other receivables and accounts payable and accrued liabilities, the Company estimates

that their carrying value approximates their fair value.

b. Change in Accounting Policies

The Company elected to adopt the following standards effective January 1, 2010 so that its accounting policies are

more closely aligned with International Financial Reporting Standards for the year ending December 31, 2010.

i) Business combinations

Section 1582, Business Combinations, replaces Section 1581, Business Combinations and establishes standards for the

accounting for business combinations. It provides the Canadian equivalent to International Financial Reporting Standard

IFRS 3, Business Combinations. The section applies prospectively to business combinations for which the acquisition

date is on or after the beginning of the first annual reporting period after adoption.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 45

2010 ANNUAL REPORT

ii) Consolidated financial statements and non-controlling interests

Section 1601, Consolidated Financial Statements, and Section 1602, Non-Controlling Interests, replace Section 1600,

Consolidated Financial Statements. Section 1601 establishes standards for the preparation of consolidated financial

statements. Section 1602 establishes standards for accounting for a non-controlling interest in a subsidiary in consoli-

dated financial statements subsequent to a business combination. It is equivalent to the corresponding provisions of

International Financial Reporting Standard IAS 27, Consolidated and Separate Financial Statements. The adoption of

this standard had no effect on the Company’s financial statements.

3. SHORT-TERM INVESTMENTS

Expressed in Canadian dollars

December 31, 2010 December 31, 2009

Guaranteed Investment Certificates

22,000,000

10,225,000

Accrued interest

6,197

6,048

SHORT-TERM INVESTMENTS

22,006,197

10,231,048

Short-term investments consist of Guaranteed Investment Certificates held with Canadian chartered banks. All certificates
are redeemable in full or in portion at the Company’s option without penalty. Interest is paid when investments are redeemed
subsequent to 30 days from the date of acquisition. Short-term investments held at December 31, 2010 bear an interest rate
of 1.3%.

4. PROPERTY AND EQUIPMENT

December 31, 2010

Cost Accumulated
amortization

Net book
value

Expressed in Canadian dollars

Computer equipment

Field equipment

Furniture and office equipment

Leasehold improvements

Vehicles

69,634

273,534

24,486

63,203

27,699

69,634

136,767

24,486

63,203

23,083

–

136,767

–

4,616

PROPERTY AND EQUIPMENT

458,556

317,173

141,383

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

December 31, 2009

Cost Accumulated
amortization

Net book
value

Expressed in Canadian dollars

Computer equipment

Field equipment

Furniture and office equipment

Leasehold improvements

Vehicles

69,634

273,534

24,486

63,203

27,699

67,461

82,061

22,475

63,203

13,850

2,173

191,473

2,011

–

13,849

PROPERTY AND EQUIPMENT

458,556

249,050

209,506

5. MINERAL PROPERTIES

Canada

Yukon

Casino

Carmacks

British
Columbia

Northwest
Territories

Island
Copper

Redstone

TOTAL

Expressed in Canadian dollars

DECEMBER 31, 2008

20,821,505

14,645,143

18,088,325

12,147,609

65,702,582

Advance royalty

Claims maintenance

Detailed engineering

Engineering studies

Exploration

Future income tax

Permitting

Reclamation obligation

Salary and wages

Stock-based compensation

–

100,000

10,363

4,408

–

93,945

112,991

1,470

–

100,000

40,199

–

54,970

93,945

114,461

3,711,996

–

(331,310)

161,970

3,542,656

46,434

42,427

1,652,334

673,916

–

80,300

224,775

215,625

108,346

98,997

–

3,767

2,162

–

22,500

10,447

92,628

2,328,412

80,300

462,900

217,790

DECEMBER 31, 2009

26,688,744

15,956,231

17,757,015

12,388,654

72,790,644

Advance royalty

Claims maintenance

Detailed engineering

Engineering studies

Exploration

Permitting

Salary and wages

Sock-based compensation

–

100,000

25,151

210

–

48,940

1,251,250

6,187,151

–

3,255,525

777,806

269,290

143,653

97,746

35,952

–

100,000

65,099

–

90,460

48,940

1,251,250

29,101

252,643

6,468,895

–

4,033,331

412,943

133,698

DECEMBER 31, 2010

37,774,857

17,062,792

17,786,116

12,706,396

85,330,161

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 47

2010 ANNUAL REPORT

a. Casino (100% - Yukon, Canada)

The Casino porphyry copper-gold-molybdenum property is located in west-central Yukon, Canada.

Should it make a production decision, Western Copper is required to make a cash payment of $1 million. Production on the

claims is also subject to a 5% net profits interest.

b. Carmacks (100% - Yukon, Canada)

The Carmacks Copper Project is an oxide copper deposit that is located in Yukon, Canada.

In April 2009, the Company obtained the Quartz Mining License relating to the Carmacks Copper Project. As a result, West-

ern Copper was required to provide security in the amount of $80,300 representing the estimated reclamation cost for work

performed to date on the property. The Company holds a Guaranteed Investment Certificate in this amount in safekeeping

for the Yukon Government. The security will be released once Western Copper performs its obligations pursuant to the

Quartz Mining License.

Any production from the Carmacks Copper Project is subject to either a 15% net profits interest or a 3% net smelter royalty,

at Western Copper’s election. If Western Copper elects the net smelter royalty, it has the right to purchase the royalty for

$2.5 million, less any advance royalty payments made to that date. The Company is required to make an advance royalty

payment of $100,000 in any year in which the average daily copper price reported by the London Metal Exchange is US$1.10

per pound or greater. At December 31, 2010, Western Copper had made $700,000 in advance royalty payments and had

accrued the amount relating to 2010.

c. Island Copper (100% - British Columbia, Canada)

The Island Copper property consists of three blocks of mineral claims located on northern Vancouver Island. The mineral

claim blocks are referred to as the Hushamu claims, the Apple Bay claims, and the Rupert Block.

Should a production decision be made on the Hushamu claims, Western Copper is required to make a cash payment of $1

million to an unrelated third party within 60 days of the production decision. These mineral claims are also subject to a 10%

net profits interest.

Should a production decision be made on the Apple Bay claims, Western Copper is required to pay $800,000 in cash or in

Western Copper stock to Electra Gold Ltd. (“Electra”). The payment method is at the election of Western Copper. Electra

maintains the right to explore the Apple Bay claims for non-metallic minerals.

The Island Copper property had been under option since 2008. On July 15, 2010, Kobex Minerals Inc. terminated its rights to

earn-in on the property.

d. Redstone (100% - Northwest Territories, Canada)

The Redstone property comprises mining leases and mineral claims located in the Northwest Territories. Should produc-

tion be achieved on the mining leases, the revenue will be subject to a net smelter royalty of between 3-4% depending

on the monthly average of the final daily spot price of copper reported on the New York Commodities Exchange relating

to each production month, as follows:

•

3% if the price is less than, or equal to US$0.75 per pound;

•

3.5% if the price is greater than US$0.75 per pound, but less than or equal to US$1.00 per pound; and

•

4% if the price is greater than US$1.00 per pound.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

e. Sierra Almoloya (100% - Chihuahua, Mexico)

In 2008, the Company re-evaluated the property and decided to abandon the claims. As a result, Western Copper wrote-off

all costs capitalized relating to Sierra Almoloya.

6. SHARE CAPITAL AND CONTRIBUTED SURPLUS

a. Share Capital

Authorized

Unlimited Class A voting shares with a par value of $0.00001

Unlimited common shares without par value

Unlimited number of preferred shares without par value

Issued and outstanding

91,487,836 common shares

b. Financing

On December 22, 2010, Western Copper issued 9,395,500 units at a price of $2.45. Each unit comprised one common

share of the Company and half of one warrant. Each whole warrant is exercisable for one common share of the Company

at a price of $3.45 and expires on December 22, 2012. The agent was paid a cash commission equal to 6.0% of gross

proceeds.

The fair value assigned to the warrants was $4,476,983. The fair value of the warrants was calculated using the Black-Sc-

holes option pricing model and was based on the following assumptions:

Expected stock price volatility

Expected term, in years

Average risk-free interest rate

Expected dividend yield

114%

2.0

1.66%

–

On December 4, 2009, Western Copper issued 2,150,000 units at a price of $2.50. Each unit was comprised of one flow-

through common share of the Company and one warrant (“investor warrant”). Each warrant is exercisable for one non

flow-through common share of the Company at a price of $2.60 per common share and expires three years following closing.

If, commencing on the date that is four months plus one day following the closing of the transaction, the weighted average

trading price of the Company’s common shares is at a price equal to or greater than $5.00 for twenty consecutive trading

days, the Company has the right to accelerate the expiry date of the investor warrants by giving thirty days written notice to

the holder.

The agent received a cash commission equal to 6.0% of the gross proceeds and that number of warrants (“agent warrants”)

which is equal to 4.0% of the number of units sold. Each agent warrant is exercisable for one non flow-through common

share of the Company at a price of $2.50 per common share and expires two years following closing. If, commencing on

the date that is four months plus one day following the closing of the transaction, the weighted average trading price of the

Company’s common shares is at a price equal to or greater than $4.00 for a period of fifteen consecutive trading days, the

Company has the right to accelerate the expiry date of the agent’s warrants by giving thirty days written notice to the agent.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 49

2010 ANNUAL REPORT

The fair value assigned to the agent warrants was $89,440. The fair value was calculated using the Black-Scholes option

pricing model on the closing date of the transaction based on the following assumptions:

Expected stock price volatility

Expected term, in years

Average risk-free interest rate

Expected dividend yield

132%

2.0

1.27%

–

The fair value assigned to the investor warrants was $1,848,495. The fair value of the investor warrants was calculated using

the Black-Scholes option pricing model and was based on the following assumptions:

Expected stock price volatility

Expected term, in years

Average risk-free interest rate

Expected dividend yield

114%

3.0

1.73%

–

On July 10, 2009, Western Copper issued 4,000,000 units at a price of $1.00. Each unit comprised of one flow-through

common share of the Company and half of one warrant. Each whole warrant (“investor warrant”) is exercisable for one non

flow-through common share of the Company at a price of $1.25 per common share and expires three years following closing.

If, commencing on the date that is four months plus one day following the closing of the transaction, the weighted average

trading price of the Company’s common shares is at a price equal to or greater than $2.00 for a period of twenty trading

days, the Company has the right to accelerate the expiry date of the investor warrants by giving thirty days written notice to

the holder.

The agent received a cash commission equal to 6.0% of the gross proceeds and that number of warrants (“agent warrants”)

which is equal to 6.0% of the number of units sold. Each agent warrant is exercisable for one non flow-through common

share of the Company at a price of $1.25 per common share and expires two years following closing. If, commencing on

the date that is four months plus one day following the closing of the transaction, the weighted average trading price of the

Company’s common shares is at a price equal to or greater than $1.75 for a period of fifteen consecutive trading days, the

Company has the right to accelerate the expiry date of the agent’s warrants by giving thirty days written notice to the agent.

The fair value assigned to the agent warrants is $114,960. The fair value was calculated using the Black-Scholes option pric-

ing model on the closing date of the transaction based on the following assumptions:

Expected stock price volatility

Expected term, in years

Average risk-free interest rate

Expected dividend yield

110%

2.0

1.33%

–

The fair value assigned to the investor warrants was $813,200. The fair value of the investor warrants was calculated using

the Black-Scholes option pricing model and was based on the following assumptions:

Expected stock price volatility

Expected term, in years

Average risk-free interest rate

Expected dividend yield

127%

3.0

1.33%

–

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

c. Donation of Common Shares

On February 19, 2010, Western Copper issued and donated 90,000 common shares to the University of British Columbia.

Western Copper recorded a total of $117,900 as a donation expense.

7. WARRANTS AND STOCK OPTIONS

a. Warrants

A summary of the Company’s warrants outstanding at December 31, 2010 and the changes for the year then ended,

is presented below:

Expressed in Canadian dollars

DECEMBER 31, 2009

Issued

Exercised

Expired

DECEMBER 31, 2010

Number of
Warrants

Weighted average
exercise price

4,275,000

4,697,750

(1,964,000)

(75,000)

6,933,750

1.95

3.45

1.25

3.17

Warrants outstanding at December 31, 2010 are as follows:

Warrants outstanding,
by exercise price

Expressed in Canadian dollars

$2.50

$2.60

$3.45

DECEMBER 31, 2010

Number of
Warrants

Average remaining
contractual life

86,000

2,150,000

4,697,750

6,933,750

years

0.93

1.93

1.98

1.95

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 51

2010 ANNUAL REPORT

b. Stock Options

Based on the Company’s Stock Option Plan, the Company may issue stock options for the purchase of up to 10% of issued

capital. The exercise price of the stock options shall be greater than, or equal to, the market value of the Company’s com-

mon shares on the last trading day immediately preceding the date of grant. Stock options vest over a two year period from

the date of grant unless otherwise determined by the directors. The maximum stock option term is 10 years. At December

31, 2010, the Company could issue an additional 4,945,449 stock options.

A summary of the Company’s stock options outstanding at December 31, 2010 and the changes for the year then ended, is

presented below:

Expressed in Canadian dollars

DECEMBER 31, 2009

Granted

Exercised

Expired

Forfeited

DECEMBER 31, 2010

Number of
stock options

Weighted average
exercise price

4,136,834

970,000

(763,300)

(100,000)

(40,200)

4,203,334

1.39

1.05

0.91

1.50

0.60

1.41

Stock options outstanding at December 31, 2010 are as follows:

Stock options outstanding,
by exercise price

Expressed in Canadian dollars

$0.60 - 0.97

$1.25 - 1.90

$2.00 - 2.02

DECEMBER 31, 2010

Number of
stock options

Weighted average
exercise price

Average remaining
contractual life

1,435,000

1,508,334

1,260,000

4,203,334

0.75

1.54

2.00

1.41

Years

3.84

2.07

0.64

2.24

Of the total stock options outstanding, 2,957,900 were vested and exercisable at December 31, 2010. The weighted
average exercise price of vested stock options is $1.57 and the average remaining contractual life is 1.40 years.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

8. STOCK-BASED COMPENSATION

Stock-based compensation has been allocated to the following line items:

For the year ended December 31,

Expressed in Canadian dollars

2010

2009

2008

STATEMENT OF LOSS AND COMPREHENSIVE LOSS

ADMINISTRATIVE EXPENSES

Office and administration

Shareholder communication

BALANCE SHEET

MINERAL PROPERTIES

Casino

Carmacks

Island Copper

Redstone

400,875

295,842

389,533

16,002

53,556

36,283

416,877

349,398

425,816

97,746

35,952

–

108,346

98,997

–

10,447

122,390

122,514

1,383

2,288

133,698

217,790

248,575

STOCK-BASED COMPENSATION

550,575

567,188

674,391

The Company last granted stock options on November 4, 2010. On that date, Western Copper granted 100,000 stock

options to an employee at an exercise price of $1.64 per common share. The fair value assigned to the stock options is

$106,747.

On July 16, 2010, Western Copper granted 770,000 stock options to employees, directors, and consultants. The stock

options granted on July 16, 2010 have an exercise price of $0.86 per common share. The fair value assigned to the stock

options is $448,430.

On March 30, 2010, Western Copper granted 100,000 stock options to a director at an exercise price of $1.90 per common

share. The fair value assigned to the stock options was $149,335.

The fair value of stock options granted in 2010 was calculated using the Black-Scholes option pricing model and the following

assumptions:

ASSUMPTION

November 4, 2010

July 16, 2010

March 30, 2010

Expected stock price volatility

Expected option term, in years

Average risk-free interest rate

Expected dividend yield

104%

3.12

1.57%

–

118%

2.73

1.82%

–

107%

5.00

2.92%

–

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 53

2010 ANNUAL REPORT

9. COMMITMENTS

The Company has an agreement to lease office space in Vancouver until May 31, 2014. The total amount of payments

remaining during the course of the agreement as at December 31, 2010 is $728,239. Of this amount, $210,288 is due within

the next twelve months.

The Company has an agreement to lease office space in the Yukon until December 31, 2011. The total amount of payments

remaining during the course of the agreement as at December 31, 2010 is $28,635. The entire amount is due within the

next twelve months.

Mineral property commitments are described in note 5.

10. SEGMENTED INFORMATION

a. Industry Information

The Company operates in one reportable operating segment: the acquisition, exploration, and future development

of resource properties.

b. Geographic Information

All interest is earned in Canada. All non-current assets are held in Canada. The geographical breakdown of mineral

properties is shown in note 5.

11. CAPITAL MANAGEMENT

Western Copper is a mineral exploration company with a primary focus of advancing its mineral properties towards

production. Its principal source of funds is the issuance of common shares. The Company considers capital to be equity

attributable to common shareholders, comprised of share capital, contributed surplus, and deficit. It is the Company’s

objective to safeguard its ability to continue as a going concern so that it can continue to explore and develop its projects.

Western Copper manages its capital structure based on the funds available for its operations and makes adjustments

for changes in economic conditions, capital markets and the risk characteristics of the underlying assets. To maintain its

objectives, the Company may attempt to issue new shares, seek debt financing, acquire or dispose of assets or change the

timing of its planned exploration and development projects. There is no assurance that these initiatives will be successful.

To facilitate the management of its capital, Western Copper prepares annual expenditure budgets and updates them as

necessary, depending on various factors, many of which are beyond the Company’s control. The Board of Directors approves

all annual budgets and subsequent updates.

The Company monitors its cash position and its short-term investments on a regular basis to determine whether sufficient

funds are available to meet its short-term and long-term corporate objectives. The Company also seeks to provide liquidity

and limit credit risk by acquiring investments that are guaranteed by Canadian governments or by a Canadian chartered bank

and that are redeemable in portion or in full at the Company’s option without penalty.

There was no change in the Company’s approach to capital management during the period. Western Copper has no

debt and does not pay dividends. Neither the Company nor any of its subsidiaries is subject to externally imposed capital

requirements.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

12. FINANCIAL INSTRUMENT RISK

The Board of Directors has overall responsibility for the establishment and oversight of the Company’s risk management

framework. The Company has exposure to credit, liquidity, currency, interest rate and market risks from the use of finan-

cial instruments. Financial instruments consist of cash and cash equivalents, short-term investments, other receivables,

reclamation bonds, and accounts payable and accrued liabilities.

a. Market Risk

The Company does not generate cash from its operating activities. Its principal source of funds is the issuance of common

shares. It uses the capital raised from the issuance of its common shares to explore and develop its mineral properties with

the goal of increasing the price of the Company’s common shares. Western Copper’s common shares are publicly traded.

As such, the price of its common shares is susceptible to factors beyond management’s control including, but not limited

to, fluctuations in commodity prices and foreign exchange rates and changes in the general market outlook. Should Western

Copper require funds during a time when the price of its common shares is depressed, the Company may be required to

accept significant dilution to maintain enough liquidity to continue operations or may be unable to raise sufficient capital to

meet its obligations. The Company’s contractual obligations are described in note 9.

b. Liquidity Risk

Liquidity risk is the risk that the Company will be unable to meet its financial obligations as they come due. The Company

uses cash forecasts to ensure as far as possible that there is sufficient cash on hand to meet short-term business

requirements. Cash is invested in highly liquid investments which are available to discharge obligations when they come

due. The Company does not maintain a line of credit.

c. Credit Risk

Financial instruments that potentially subject the Company to credit risk consist primarily of cash and cash equivalents and

short-term investments. These financial instruments are at risk to the extent that the institutions issuing or holding them

cannot redeem amounts when they are due or requested. To limit its credit risk, the Company uses a restrictive investment

policy. It deposits cash and cash equivalents in Canadian chartered banks and purchases short-term investments that are

guaranteed by Canadian governments or by Canadian chartered banks.

d. Currency Risk

Currency risk is the risk that the Company will lose significant purchasing power to operate its business as a result of

changes in currency rates. The Company raises funds in Canadian dollars. The majority of the Company’s expenditures

are incurred in Canadian dollars. To limit its exposure to currency risk, the Company maintains the majority of its cash and

cash equivalents in Canadian dollars. The Company did not have a material amount of financial instruments denominated in

foreign currencies as at December 31, 2010 or December 31, 2009.

e. Interest Rate Risk

The Company is exposed to interest rate risk on its cash and cash equivalents and its short-term investments to the extent

that the institutions that hold or issue those instruments cannot pay the interest earned on them by Western Copper.

Potential losses in interest income would not have a material impact on the Company’s results of operations.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 55

2010 ANNUAL REPORT

13. SUPPLEMENTAL CASH FLOW INFORMATION

For the year ended December 31,

Expressed in Canadian dollars

2010

2009

2008

CHANGE IN NON-CASH WORKING CAPITAL ITEMS

Accrued interest on short-term investments

(149)

19,114

(25,162)

Other receivables relating to operations

Prepaid expenses

Accounts payable and accrued liabilities relating to operations

(48,081)

(11,924)

(50,209)

19,400

6,046

35,285

13,501

4,316

12,160

CHANGE IN NON-CASH WORKING CAPITAL ITEMS

(110,363)

79,845

4,815

14. INCOME TAXES

a. Income Tax Balances

The Company has approximately $8.2 million in non-capital losses that may be carried forward to apply against future years’

income for Canadian income tax purposes. The losses expire as follows:

Available to

Expressed in Canadian dollars

2014

2015

2024

2025

2026

2027

2028

2029

2030

Amount

89,319

34,373

10,780

48,781

410,941

1,288,583

1,880,692

1,860,492

2,585,586

NON-CAPITAL LOSSES CARRIED FORWARD

8,209,547

The Company has approximately $47.2 million in Canadian Exploration and Development Expenditures (“CEDE”) that are

available to reduce future taxable income. CEDE balances do not expire.

b. Statutory Rate Reconciliation

The current and future income tax expense or recovery reported by the Company differs from the amounts obtained by

applying statutory rates to the loss before income tax.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

A reconciliation of the income tax provision computed at statutory rates to the reported income tax provision is provided

below:

Expressed in Canadian dollars

Statutory tax rate

Loss before taxes

2010

2009

2008

28.50%

30.00%

31.00%

2,776,979

2,256,054

2,610,952

Income tax recovery calculated at statutory rate

791,439

676,816

809,395

Non-deductible expenditures

Effect of differences in income tax rates

Effect of mineral property write-off

Items included in equity and other

Change in valuation allowance

(185,910)

(110,776)

(283,210)

(86,807)

133,972

–

381,144

(40,094)

134,440

103,185

213,768

(899,866)

(264,021)

(525,875)

FUTURE INCOME TAX RECOVERY

–

395,897

451,703

c. Future Income Tax Liability

Temporary differences arising from the difference between the tax basis and the carrying amount of the Company’s mineral

properties is used to calculate the future income tax liability of $12,472,501 (2009 - $9,661,846).

Future income tax liability is measured using tax rates and laws that are expected to apply when the differences are

expected to reverse.

d. Future Income Tax Assets

Future income tax liabilities and future income tax assets offset if they relate to the same taxable entity and the same

taxation authority. Future potential tax deductions that are not used to offset future income tax liabilities are considered to

be future income tax assets.

The significant components of the Company’s future tax assets are as follows:

Expressed in Canadian dollars

Mineral property interests

Non-capital losses

Other temporary differences

2010

2009

2,143,072

2,171,208

2,029,201

1,417,476

534,658

218,381

FUTURE INCOME TAX ASSETS

4,706,931

3,807,065

Valuation allowance

(4,706,931)

(3,807,065)

FUTURE INCOME TAX ASSETS, NET

–

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 57

2010 ANNUAL REPORT

The Company estimates that the realization of income tax benefits related to these future potential tax deductions is

uncertain and cannot be viewed as more likely than not. Accordingly, a valuation allowance in the amount of the potential

future benefit has been recorded and no net future income tax asset has been recognized.

15. MATERIAL DIFFERENCES BETWEEN CANADIAN AND UNITED STATES

GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP)

Western Copper prepares its consolidated financial statements in accordance with accounting principles generally accepted

in Canada (“Canadian GAAP”), which differ in certain material respects from those principles that the Company would

have followed had its financial statements been prepared in accordance with accounting principles generally accepted in

the United States (“US GAAP”). The effects of significant measurement differences between Canadian and US GAAP are

described below.

a. Balance Sheets

As at December 31,

Expressed in Canadian dollars

Mineral properties - Canadian GAAP

Cumulative exploration expenditures written off under US GAAP

Future income tax effect of cumulative exploration expenditures written off
under US GAAP

MINERAL PROPERTIES - US GAAP

Future income tax liability – Canadian GAAP

Cumulative adjustments under US GAAP

2010

2009

85,330,161

72,790,644

(37,992,824)

(25,453,307)

(312,960)

47,024,377

12,472,501

9,661,846

(7,344,699)

(3,772,304)

FUTURE INCOME TAX LIABILITY – US GAAP

5,127,802

5,889,542

Shareholders’ equity - Canadian GAAP

Cumulative exploration expenditures written off under US GAAP

Cumulative future income tax recovery adjustment under US GAAP

Flow-through share premium

95,664,251

76,116,921

(37,992,824)

(25,453,307)

7,031,739

3,459,344

–

(685,000)

SHAREHOLDERS’ EQUITY - US GAAP

64,703,166

53,437,958

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

b. Statements of Loss, Comprehensive Loss and Deficit

For the years ended December 31,

Expressed in Canadian dollars

2010

2009

2008

Loss and comprehensive loss – Canadian GAAP

2,776,979

1,860,157

2,159,249

Mineral property write-off under Canadian GAAP

–

(405,001)

Exploration expenditures for the period under US GAAP

12,539,517

6,995,434

8,727,133

Future income tax recovery under Canadian GAAP

–

395,897

451,703

Future income tax recovery under US GAAP

(1,446,740)

(1,683,289)

(1,841,597)

LOSS AND COMPREHENSIVE LOSS – US GAAP

13,869,756

7,568,199

9,091,487

Loss and diluted loss per common share

0.17

0.10

0.12

Weighted average number of common shares outstanding

81,128,926

74,897,792

72,792,941

Deficit – US GAAP, beginning of year

Loss and comprehensive loss

50,050,756

42,482,557

33,391,070

13,869,756

7,568,199

9,091,487

DEFICIT – US GAAP, END OF YEAR

63,920,512

50,050,756

42,482,557

c. Statements of Cash Flow

For the year ended December 31,

Expressed in Canadian dollars

2010

2009

2008

Cash provided by (used in) operating activities – Canadian GAAP

(2,339,148)

(1,793,475)

(1,735,717)

Adjustment for mineral properties and deferred exploration under US GAAP

(12,475,486)

(6,539,009)

(8,573,293)

CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES – US GAAP

(14,814,637)

(8,332,484)

(10,309,010)

Cash provided by (used in) financing activities – Canadian GAAP

24,784,204

8,956,411

Gross proceeds received from issuance of flow-through units

–

(9,375,000)

CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES – US GAAP

24,784,204

(418,589)

500

–

500

Cash provided by (used in) investing activities – Canadian GAAP

(24,250,489)

(8,764,009)

(16,954,526)

Adjustment for mineral properties and deferred exploration under
US GAAP

12,475,489

6,539,009

8,573,293

Gross proceeds received from issuance of flow-through units

–

9,375,000

–

CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES – US GAAP

(11,775,000)

7,150,000

(8,381,233)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 59

2010 ANNUAL REPORT

d. Current Differences in Accounting Principles

i) Mineral property expenditures

Mineral property exploration expenditures are accounted for in accordance with Canadian GAAP as disclosed in note 2.

For US GAAP purposes, exploration expenditures relating to mineral properties for which commercial and legal

feasibility has not yet been established and administrative expenditures are expensed as incurred. The Company

expenses development costs until proven and probable reserves are determined and substantially all required permits

are obtained.

Mineral property acquisition costs, including periodic option payments, and development expenditures incurred

subsequent to the determination of the feasibility of mining operations are deferred until the property to which they

relate is placed into production, sold, allowed to lapse or abandoned, or when impairment in value has been determined

to have occurred.

ii) Flow-through shares

In 2009, the Company completed two private placements of flow-through units. For Canadian GAAP purposes, the

Company records the proceeds of the issuance of flow-through shares as described in note 2.

Under US GAAP, the gross proceeds from the issuance of flow-through shares need to be allocated between the

offering of the flow-through shares and any premium paid for the implied tax benefit received by the investors as a

result of the flow-through shares. The calculated tax benefit is recognized as a liability until the Company renounces

the expenditures, at which point the liability is reversed and is recorded as a tax recovery on the statement of loss. At

December 31, 2010, this liability was $nil (2009 - $685,000).

US GAAP also requires that the portion of the gross proceeds from flow-through shares not yet spent by the Company

be considered restricted cash, as the funds are required to be expended on exploration in Canada in order to satisfy the

requirements of the renouncement to the investors. At December 31, 2010 this amount was $nil (2009 - $5.91 million).

e. Recent and Future Accounting Pronouncements Under US GAAP

i) ASU 2010-09 Topic 855 – Subsequent Events

Amends ASC 855 to address certain implementation issues, including (1) eliminating the requirement for SEC filers to

disclose the date through which it has evaluated subsequent events, (2) clarifying the period through which conduit

bond obligors must evaluate subsequent events, and (3) refining the scope of the disclosure requirements for reissued

financial statements. The amendments to ASC 855 made by ASU 2010-9 are effective upon issuance for entities other

than conduit bond obligors. This rule is effective for years ending June 15, 2010 or later.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2010 ANNUAL REPORT

noTes

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 61

2010 ANNUAL REPORT

WesTeRn coppeR
managemenT Team

MANAGEMENT

BOARD OF DIRECTORS

Dale Corman, B.Sc., P.Eng
Chairman & CEO

Dale Corman, B.Sc., P.Eng.
Chairman

Paul West-Sells, Ph.D.
President & COO

Robert Byford, B.A., FCA
Director

Julien François, CA
VP Finance & CFO

Robert Gayton, B.Comm., Ph.D., FCA
Director

Cameron Brown, P. Eng.
VP Engineering

Ian Watson
Director

Jonathan Clegg, P.Eng
Engineering

David Williams, LL.B., MBA
Director

Klaus Zeitler, Ph.D.
Director

STOCK EXCHANGE

Toronto Stock Exchange Symbol: WRN
New York Stock Exchange AMEX Symbol: WRN

COMPANY FILINGS

www.sedar.com
www.sec.gov

TRANSFER AGENT

Computershare Investor Services Inc.
100 University Avenue, 8th Floor
Toronto, Ontario
Canada, M5J 2Y1

Toll Free in North America: 1 800 564 6253
Int’l 514 982 7555
By Internet www.computershare.com

AUDITORS

PricewaterhouseCoopers LLP
7th Floor – 250 Howe Street
Vancouver, British Columbia
Canada V6C 3S7

LEGAL COUNSEL

CORPORATE HEAD OFFICE

Western Copper Corporation
2050 - 1111 West Georgia Street
Vancouver, British Columbia
Canada V6E 4M3

Toll Free: 1 888 966 9995
Phone: 604 684 9497
604 669 2926
Fax:

www.westerncoppercorp.com

INVESTOR RELATIONS

Julie Kim

Manager Corporate Communications
& Investor Relations

info@westerncoppercorp.com

ANNUAL GENERAL MEETING

Thursday, June 23rd, 2011
2:30pm PST

DuMoulin Black LLP
10th Floor - 595 Howe Street
Vancouver, British Columbia
Canada V6C 2T5

1111 West Georgia Street
Thurlow Room, Main Floor
Vancouver, British Columbia
Canada V6E 4M3

WESTERN COPPER
CORPORATION

2050 -1111 West Georgia Street | Vancouver, BC | Canada V6E 4M3

Toll Free: 1 888 966 9995 | Phone: 604 684 9497 | Fax: 604 669 2926 | Email: info@westerncoppercorp.com

W W W . W E S T E R N C O P P E R C O R P. C O M

TSX:WRN NYSE:WRN