CEO’s Letter to Shareholders 2008

Last year in my letter to shareholders I stated that it was hard to imagine a scenario where copper demand would not exceed supply for the foreseeable future. What a difference a year makes. The near collapse of the U.S. banking system sent ripples around the world resulting in a worldwide slowdown in manufacturing and international and domestic trade. With the exception of gold, all commodities fell by at least 50% in September and October causing companies to suspend or curtail production and put on hold expansion plans. Projects that were originally planned for completion in 2010 have been rescheduled for 2012 or later and large projects that were in the conceptual stage have been postponed indefinitely. The collapse in copper prices from a high of $4.00 per pound to around $1.50 per pound resulted in a slowdown in near and long term planned production. This will ultimately result in future shortages and higher than currently projected copper prices.

Despite the turmoil in the financial markets and mining in general, we have managed to complete most of the tasks that we set for ourselves. Our key accomplishments were the completion of a positive Pre-Feasibility Study on Casino, which defines it as one of the world’s largest copper, gold and molybdenum deposits that provides an attractive Internal Rate of Return at current metal prices. We also received government approval allowing our Carmacks Copper Project to proceed and we will soon obtain a Quartz Mining License which will allow us to start construction. Our Hushamu property located on the northern end of Vancouver Island is a very large porphyry deposit with exceptional exploration potential. This property was optioned to IMA Exploration Inc. in August of last year. Diamond drilling by IMA on the main Hushamu deposit not only confirmed the copper and gold grades previously indicated, it also confirmed the presence of molybdenum and indicated high grade rhenium values.

In the coming year we will be focusing our resources on obtaining a Water License for our Carmacks Copper Project, which will allow the mine to operate, and the collection of baseline data information at Casino so that we are in position to submit a permit application to the Yukon government early in 2010. Also at Casino, we are planning a deep penetrating geophysical survey to help locate additional reserves below the current pit boundaries. Upon the completion of the survey in mid July we will consider further drilling to assist our engineering group in converting approximately 200 million tonnes of inferred material into proven and probable reserves and to expand reserves outside of the current pit boundaries.

We are fortunate that we have more than sufficient capital to meet our 2009 objectives. Based on our current budget, we anticipate that we will have between $7 and $10 million in cash reserves at the end of the year.

Our exceptional team is looking forward to the challenge of progressing our collection of projects in the current tight commodity market for the benefit of our shareholders.

"Dale Corman"

F. Dale Corman
Co-Chairman & CEO
Western Copper Corporation