The company said it based the decision on a construction capex estimate of US$197 million.
It had closed an upsized equity raising of C$108.5 million last month to continue to advancing towards construction of the underground project.
Nevada Copper said with completing the offering and the construction decision, it could now draw down $70 million in accordance with a precious metals purchase and sales agreement struck in December.
It has also secured a standby loan facility of up to $25 million from cornerstone shareholder Pala Investments, which could help advance Pumpkin Hollow's separate openpit project.
The company awarded a mining contract for shaft sinking and underground development work to Cementation USA, and an engineering, procurement and construction contract to CIMIC Group member Sedgman USA for a fixed $118 million.
"Delivery of the underground project is the first key step in our strategy of capital-efficient, phased growth from our base in Nevada," president and CEO Matt Gili said.
Nevada Copper started preconstruction activities in May and expects to transition to full-scale construction for the fully permitted project shortly.
It is expected to average an annual 60 million pounds of copper, 9,000oz of gold and 173,000oz of silver over the first five years of production.
The company's shares hit a 52-week low of C44c intraday and closed down more than 3% to 46c.