Hudbay Announces Pampacancha Surface Rights Agreement
February 18 2020 - 5:00PM
Hudbay Minerals Inc. (“Hudbay” or the “company”)
(TSX, NYSE: HBM) today announced the
community of Chilloroya has formally approved a surface rights
agreement with Hudbay for the Pampacancha satellite deposit located
near the Constancia mine in Peru. With the completion of this
agreement, the company expects to be mining ore from the deposit in
late 2020.
“We are very pleased to have reached a
Pampacancha agreement with the community,” said Peter Kukielski,
Hudbay’s President and Chief Executive Officer. “I have been
impressed with the team’s work and appreciate the years of effort
to achieve this goal. Pampacancha adds high-grade copper and gold
ore into the Constancia mine plan, lowering future cash costs for
the mine and increasing operating cash flows at Constancia. Not
only was Constancia one of the best project development and
production ramp-up successes of recent project builds, Constancia
is also one of the lowest cost open pit copper mines in South
America. This could not have been achieved without our long-term
commitment to, and partnership with, our local communities, and
this successful agreement further validates our social acceptance
to operate in Peru.”
“On behalf of Hudbay Peru, I would like to thank
the community of Chilloroya for their dedication to completing this
agreement which further enhances our valued long-term relationship
with the community,” said Javier Del Rio, Vice President of
Hudbay’s South America Business Unit. “We look forward to
continuing harmonious negotiations with the communities north of
Constancia on our highly prospective exploration properties.”
The company expects growth capital expenditures
associated with project development and acquiring the surface
rights for Pampacancha to be approximately $70 million in 2020. In
accordance with Peru’s Consulta Previa law, additional consultation
between the Peruvian government and the local community is required
before Hudbay can begin development activities. Some additional
capital costs remain outstanding in recognition of current uses of
the land by certain community members and the company intends to
enter into agreements to address these matters prior to commencing
mining activities. With the community’s endorsement of the
agreement, the company believes these processes will be concluded
in the first half of 2020.
Qualified Person
The technical and scientific information in this
news release related to the Constancia mine has been approved by
Cashel Meagher, P. Geo, Hudbay’s Senior Vice President and Chief
Operating Officer. Mr. Meagher is a qualified person pursuant to NI
43‑101. For a description of the key assumptions, parameters and
methods used to estimate mineral reserves and resources at Hudbay’s
material properties, as well as data verification procedures and a
general discussion of the extent to which the estimates of
scientific and technical information may be affected by any known
environmental, permitting, legal title, taxation, sociopolitical,
marketing or other relevant factors, please see the technical
reports for the company’s material properties as filed by Hudbay on
SEDAR at www.sedar.com.
Forward-Looking Information
This news release contains forward-looking
information within the meaning of applicable Canadian and United
States securities legislation. Forward-looking information
includes, but is not limited to, plans to commence the development
of Pampacancha, expectations regarding the timing of mining
activities at Pampacancha, and expected production, costs and cash
flows from the Pampacancha and Constancia mines. Forward-looking
information is not, and cannot be, a guarantee of future results or
events. Forward-looking information is based on, among other
things, opinions, assumptions, estimates and analyses that, while
considered reasonable by the company at the date the
forward-looking information is provided, inherently are subject to
significant risks, uncertainties, contingencies and other factors
that may cause actual results and events to be materially different
from those expressed or implied by the forward-looking
information.
The material factors or assumptions that Hudbay
identified and were applied by the company in drawing conclusions
or making forecasts or projections set out in the forward-looking
information include, but are not limited to, the timing of
development and production activities on the Pampacancha deposit,
the timing of the Consulta Previa and permitting process, the
timing for reaching additional agreements with individual community
members and no significant unanticipated delays to the development
of Pampacancha.
The risks, uncertainties, contingencies and
other factors that may cause actual results to differ materially
from those expressed or implied by the forward-looking information
may include, but are not limited to, risks generally associated
with the mining industry, such as economic factors (including
future commodity prices, currency fluctuations, energy prices and
general cost escalation), risks associated with the political
situation in Peru, risks associated with the Consulta Previa
process, risks associated with reaching additional agreements with
individual community members, risks associated with the rainy
season in Peru as well as the risks discussed under the heading
“Risk Factors” in Hudbay’s most recent Annual Information Form.
Should one or more risk, uncertainty,
contingency or other factor materialize or should any factor or
assumption prove incorrect, actual results could vary materially
from those expressed or implied in the forward-looking information.
Accordingly, you should not place undue reliance on forward-looking
information. Hudbay does not assume any obligation to update or
revise any forward-looking information after the date of this news
release or to explain any material difference between subsequent
actual events and any forward-looking information, except as
required by applicable law.
About Hudbay
Hudbay (TSX, NYSE: HBM) is an integrated mining
company primarily producing copper concentrate (containing copper,
gold and silver), molybdenum concentrate and zinc metal. With
assets in North and South America, the company is focused on the
discovery, production and marketing of base and precious metals.
Directly and through its subsidiaries, Hudbay owns three
polymetallic mines, four ore concentrators and a zinc production
facility in northern Manitoba and Saskatchewan (Canada) and Cusco
(Peru), and copper projects in Arizona and Nevada (United States).
The company’s growth strategy is focused on the exploration and
development of properties it already controls, as well as other
mineral assets it may acquire that fit its strategic criteria.
Hudbay’s vision is to be a responsible, top-tier operator of
long-life, low-cost mines in the Americas. Hudbay’s mission is to
create sustainable value through the acquisition, development and
operation of high-quality, long-life deposits with exploration
potential in jurisdictions that support responsible mining, and to
see the regions and communities in which the company operates
benefit from its presence. The company is governed by the Canada
Business Corporations Act and its shares are listed under the
symbol "HBM" on the Toronto Stock Exchange, New York Stock Exchange
and Bolsa de Valores de Lima. Further information about Hudbay can
be found on www.hudbay.com.
For investor and media inquiries, please
contact:
Candace BrûléDirector, Investor Relations
(416) 814-4387 candace.brule@hudbay.com
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