Hudbay Q3 results on track to meet 2019 guidance

Hudbay Minerals’ Lalor mine in Manitoba. Image from Hudbay Minerals

Hudbay Minerals reported Q3 operating and financial results which put it on track to meet its 2019 production guidance. Company wide Q3 copper production came in at 36,422 tonnes with an additional 28,639 tonnes of zinc as well as 41,500 oz. of gold equivalent ounces, for a total of 57,900 tonnes produced on a copper equivalent basis. Consolidated all-in sustaining cash costs per pound of copper produced, net of by product credits came in at $1.90.

The Manitoba operations contributed 5,331 tonnes of copper, 28,639 tonnes of zinc and 26,153 gold equivalent ounces. Manitoba unit costs for the year are expected to come in at or slightly above the upper end of the 2019 guidance of $115 to $135 per tonne of ore processed.

In the quarter, Hudbay also recorded an after tax impairment loss of $242.1 million on the carrying value of the Rosemont copper project in Arizona following a US District Court decision on vacating and remanding the permits for the project

Q3 sustaining cash costs per pound of copper produced, net of by product credits came in at $2.40 per pound. The company noted that unit costs have been trending down with the ramp up of the Lalor underground mine. Hudbay is also working on refurbishment of the New Britannia mill with engineering and permitting activities ongoing. Construction is expected to start in 2020 for 2021 commissioning of the 1,500 t/d mill to process Lalor mine ore.

Production from the Peru assets came in at 31,091 tonnes of copper and 15,369 ounces of gold equivalent precious metals at a sustaining cash cost net of by product credits of $1.73 per pound of copper.

In the quarter, Hudbay also recorded an after tax impairment loss of $242.1 million on the carrying value of the Rosemont copper project in Arizona following a July 31 US District Court decision on vacating and remanding the permits for the project. In October, the US District Court for Arizona turned down the company’s request to reconsider the ruling. Hudbay intends to appeal the decision; Rosemont is envisioned as a copper asset producing 127,000 tonnes of the metal annually.

(This article first appeared in the Canadian Mining Journal)

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