HudBay advances on higher production forecasts

TORONTO – HudBay Minerals Inc. [HBM-TSX, NYSE] has released updated reserves and resources and issued new operating guidance for 2024 and 2025.

The company also disclosed that it has successfully extended the known down-dip of its Lalor gold-copper zinc deposit in Manitoba.

HudBay shares advanced on the news, rising 0.566% or $0.04 to $7.11 on volume of 560,320. The shares are currently trading in a 52-week range of $10.28 and $4.07.

HudBay is a diversified mining company with assets in North and South America, including the Constancia operations in Peru, its Snow Lake operations in Manitoba and an organic pipeline that includes the Copper World project in Arizona.

In 2023, the company reported consolidated copper production of 104,173 tonnes, consolidated gold production of 219,700 ounces and consolidated silver production of 3.16 million ounces, marking an increase of 5%, 13% and 4% respectively in 2022, compared to 2021.

In 2023, the company is forecasting copper production of 114,000 tonnes, gold production of 285,500 ounces. The company has said it anticipates further production increases in 2024 and 2025.

The company is now saying that consolidated copper production over the next three years is expected to increase to 114,000, 130,500 tonnes and 116,000 tonnes respectively. Consolidated gold production over the next three years is expected to increase to 285,000 ounces, 296,500 ounces and 258,500 ounces respectively from 2022 levels.

HudBay said annual copper production from Constancia in Peru is expected to average 110,000 tonnes over the next three years, a 23% increase from 2022 levels.

HudBay recently announced details of an exploration agreement for the Maria Reyna and Caballito satellite properties near Constancia.

Constancia is one of the lowest cost open-pit sulphide copper mines in South America. The Constancia operations also include the nearby Pampcancha satellite pit, a high-grade copper-gold deposit where mining activities began in 2021.

Meanwhile, annual gold production from Snow Lake is expected to average more than 190,000 ounces over the next three years, a 30% increase from 2022 levels.

The company recently  announced a robust preliminary economic assessment (PEA) for its Copper World copper-molybdenum-silver deposit in Arizona.

The PEA reflects a two-phase mine plan contemplating the development of the Copper World deposits in conjunction with an alternative plan for part of the adjacent Rosemont deposit, with a focus on near-term production solely from private lands and patented mining claims, supporting an initial 16-year mine life sourced from both oxide and sulphide ore.

Based on an average concentrator design throughput of 60,000 tonnes per day and an oxide heap leach of 20,000 tonnes per day, the project is expected to yield average copper production of 86,000 tonnes at relatively low cash costs of US$1.15 per pound and sustaining cash costs of US$1.44 per pound.

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