Hudbay and Marubeni Sign Option Agreement to Advance Exploration Partnership
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Hudbay Minerals has signed an option agreement with Marubeni Corporation to which Hudbay has granted Marubeni’s wholly-owned Canadian subsidiary an option to acquire a 20 percent interest in three projects located within trucking distance of Hudbay’s processing facilities in Flin Flon, Manitoba.
In order to exercise the option, Marubeni will fund at least $8.9 million (C$12 million) in exploration expenditures over a period of approximately five years with Hudbay acting as operator and carrying out the exploration activities.
Upon successful completion of Marubeni’s earn-in obligations, a joint-venture will be formed to hold the selected projects with Hudbay, acting as operator, holding an 80 percent interest and Marubeni holding the remaining 20 percent interest.
“This exploration partnership with Marubeni represents a significant milestone towards unlocking potential future value in the Flin Flon region. This arrangement allows us to partner with Marubeni and leverage our operational and exploration expertise to test our large Flin Flon land package to potentially bring another mine into production and utilize Hudbay’s idle processing infrastructure in Flin Flon,” said Peter Kukielski, Hudbay’s president and chief executive officer.
“Hudbay has discovered and operated 29 mines in our nearly 100-year history in Manitoba and we have the potential to continue that success with this renewed focus on exploration in Flin Flon,” added Kukielski.
“The signing of an option agreement with Hudbay gives us access to the Flin Flon Greenstone Belt, one of the most prospective base metal VMS camps in the world. We see tremendous opportunity to partner with Hudbay’s technical expertise and proven track record of successful discovery, development and operation of many mines in the region,” said Masafumi Ichigetsu, general manager, Copper Mining Dept., Marubeni.
“This is our first step to a long-lasting and prosperous relationship with Hudbay that will undoubtedly yield exceptional results,” added Ichigetsu.
The exploration work will begin in the summer of 2024 with various geochemical and mapping programs. The 2025 winter exploration program is expected to be significant with up to 20,000 meters of drilling and several geophysical programs to generate additional drill targets on the properties.
FLIN FLON PROJECTS
The agreement focuses on three projects in the Flin Flon region, namely Cuprus-White Lake, Westarm, and North Star, which were selected by Marubeni following a period of detailed due diligence. All three properties hold past producing mines that generated meaningful production with attractive grades of both base metals and precious metals.
The properties remain highly prospective with potential for further discovery based on the attractive geological setting, limited historical deep drilling and promising geochemical and geophysical targets. Cuprus-White Lake, Westarm, and North Star are all within 20 kilometers of Hudbay’s Flin Flon milling complex.
Hudbay is a copper-focused mining company with three long-life operations and a world-class pipeline of copper growth projects in tier-one mining-friendly jurisdictions of Canada, Peru, and the United States. Hudbay’s operating portfolio includes the Constancia mine in Cusco (Peru), the Snow Lake operations in Manitoba (Canada) and, upon completion of the arrangement with Copper Mountain Mining Corp., the Copper Mountain mine in British Columbia (Canada). Copper is the primary metal produced by the company, which is complemented by meaningful gold production. Hudbay’s growth pipeline includes the Copper World project in Arizona, the Mason project in Nevada (United States), the Llaguen project in La Libertad (Peru), and several expansion and exploration opportunities near its existing operations.
Marubeni Corporation is a trading company with business divisions in iron and steel, information technology, utility and infrastructure, energy, food, metals and mineral resources, development and construction, industrial machinery, and chemicals. The company markets its products globally through a network of sales offices and representative firms.
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