TSX, NYSE – HBM 2025 No. 7 Hudbay Provides Annual Reserve and Resource Update , Three-Year Production Outlook and Positive Snow Lake Exploration Results
Toronto, Ontario, March 27, 2025 – Hudbay Minerals Inc. (“Hudbay” or the “company”) (TSX, NYSE: HBM) today released its annual mineral reserve and resource update and issued new three-year production guidance. All amounts are in U.S. dollars, unless otherwise noted.
- Affirmed 2025 production guidance and issued new 2026 and 2027 production guidance,
demonstrating strong copper and gold production from Hudbay’s stable operating platform with three long-life operations in tier-one mining jurisdictions in the Americas.
- Consolidated copper production is expected to average 144,000i tonnes per year over the next three
years, maintaining stable production levels from 2024. Consolidated copper production of 161,000i tonnes is expected in 2027, representing a 17% increase from 2024 and reflects the benefits from the completion of the optimization efforts at Copper Mountain.
- Strong complementary gold exposure with consolidated gold production expected to average 253,000i
ounces per year over the next three years, reflecting continued strong production in Manitoba and a contribution from Pampacancha high grade gold zones in Peru in 2025.
- Constancia’s expected mine life maintained until 2041 with stable average annual copper production
of over 88,000i tonnes expected over the next three years, in spite of the depletion of Pampacancha in late 2025.
- Snow Lake’s expected mine life optimized to 2037 with average annual gold production of over
193,000i ounces expected over the next three years and higher mill throughput rates at New Britannia driving higher life-of-mine gold production.
- Copper Mountain’s expected mine life maintained until 2043 with average annual copper production
of 44,000i tonnes expected over the next three years, including 60,000i tonnes in 2027, a 127% increase from 2024.
- Announcing accretive transaction to consolidate a 100% interest in Copper Mountain, further
increasing Hudbay’s exposure to a long-life, high-quality copper asset in a tier-1 mining jurisdiction, and results in a 200% increase in attributable copper production from Copper Mountain in 2027 compared to 2024.
- Large exploration program in Snow Lake continues to execute threefold strategy focused on near-
mine exploration to increase near-term production and mineral reserves, testing regional satellite deposits for additional ore feed to utilize available capacity at the Stall mill, and exploring the large land package for a potential new anchor deposit to meaningfully extend mine life.
Positive initial step out drilling from the exploration drift at the 1901 deposit intersected o
significant copper-gold mineralization, including 14.3% copper over 2.5 metres and 8.3 grams per tonne gold over 3.2 metres.
Follow up drilling at Lalor Northwest continued to intersect copper-gold mineralization, including o
16.4 grams per tonne gold over 3.7 metres and 2.6% copper over 3.5 metres.
- Exploration activities in Peru in 2025 focused on advancing drill permitting for highly prospective
satellite properties near Constancia.
- Feasibility studies are underway at the fully permitted Copper World project in Arizona and minority
joint venture partnership process commenced.
“Our updated mineral reserve estimates and three-year production outlook demonstrate Hudbay’s stable copper and gold production profile from our high-quality asset base of long-life mines located in attractive mining regions in the Americas,” said Peter Kukielski, Hudbay’s President and Chief Executive Officer. “This solid foundation is further enhanced by robust exploration efforts at all our assets to drive production growth and significant mine life extension. We will continue to deliver meaningful free cash flow generation from our diversified operating platform, which together with our strengthened balance sheet, will allow us to advance our unique copper growth pipeline and unlock significant value for stakeholders.”
Constancia Operations
Constancia is Hudbay’s 100% owned copper operation located in the province of Chumbivilcas in southern Peru and consists of the Constancia and Pampacancha deposits. Current mineral reserve estimates total 517 million tonnes at 0.25% copper containing approximately 1.3 million tonnes of copper. In 2024, the company increased mineral reserve estimates at Constancia to include the addition of a tenth mining phase in the Constancia pit after conducting positive geotechnical drilling and studies in 2023. This extended the expected mine life at Constancia by three years to 2041.
Hudbay continues to mine the high-grade Pampacancha satellite deposit, located approximately six kilometres from the Constancia processing plant. Mining at the Pampacancha pit commenced in 2021 and is expected to extend until early December 2025. The mine plan has smoothed Pampacancha production throughout the year, resulting in total mill ore feed for 2025 from Pampacancha to be ~25%, lower than the typical one-third in prior years. Annual production at the Constancia operations is expected to average approximately 88,000i tonnes of copper and 31,000i ounces of gold over the next three years. This reflects steady copper production levels as higher mill throughput is expected to offset lower grades starting in 2026 after the completion of Pampacancha in late 2025.
Current mineral reserves and resources (exclusive of reserves) for Constancia and Pampacancha as of January 1, 2025 are summarized below.
| Constancia Operations | Cu Grade | Mo Grade | Au Grade | Ag Grade | |
|---|---|---|---|---|---|
| Tonnes | |||||
| Mineral Reserve and Resource | (%) | (g/t) | (g/t) | (g/t) | |
| Estimates1,2,3,4,5 | |||||
| Constancia Reserves | |||||
| Proven | 443,200,000 | 0.252 | 80 | 0.037 | 2.59 |
| Probable | 64,800,000 | 0.205 | 73 | 0.036 | 1.78 |
| Total Proven and Probable - Constancia | 508,000,000 | 0.246 | 79 | 0.037 | 2.49 |
| Pampacancha Reserves | |||||
| Proven | 8,700,000 | 0.452 | 110 | 0.272 | 5.38 |
| Probable | 200,000 | 0.284 | 117 | 0.167 | 2.81 |
| Total Proven and Probable - Pampacancha | 9,000,000 | 0.448 | 110 | 0.269 | 5.32 |
| Total Proven and Probable | 517,000,000 | 0.249 | 79 | 0.041 | 2.54 |
| Constancia Resources | |||||
| Measured | 92,700,000 | 0.211 | 57 | 0.039 | 2.24 |
| Indicated | 86,900,000 | 0.222 | 83 | 0.039 | 2.24 |
| Inferred – Open Pit | 33,700,000 | 0.247 | 69 | 0.056 | 2.75 |
| Inferred – Underground | 6,500,000 | 1.200 | 69 | 0.140 | 8.62 |
| Pampacancha Resources | |||||
| Inferred | 700,000 | 0.144 | 54 | 0.083 | 2.46 |
| Total Measured and Indicated | 179,700,000 | 0.216 | 69 | 0.039 | 2.24 |
| Total Inferred | 40,900,000 | 0.397 | 69 | 0.069 | 3.68 |
Note: totals may not add up correctly due to rounding.
1 Mineral resources are exclusive of mineral reserves and do not have demonstrated economic viability.
2 Mineral reserves are estimated using a minimum NSR cut-off of $6.40 per tonne at Pampacancha, $7.30 per tonne at Constancia and assuming metallurgical recoveries (applied by ore type) of 86% for copper on average for the life of mine.
3 Mineral resource estimates are based on resource pit design and do not include factors for mining recovery or dilution.
4 The open pit mineral resources are estimated using a minimum NSR cut-off of $6.40 per tonne and assuming metallurgical recoveries (applied by ore type) of 86% for copper on average for the life of mine, while the underground inferred resources at Constancia Norte are based on a 0.65% copper cut-off grade.
5 Long-term metal prices of $4.15 per pound copper, $15.00 per pound molybdenum, $1,900 per ounce gold and $23.00 per ounce silver were used to confirm the economic viability of the mineral reserve estimates and to estimate mineral resources.
Maria Reyna and Caballito Exploration
Hudbay controls a large, contiguous block of mineral rights with the potential to host satellite mineral deposits in close proximity to the Constancia processing facility, including the past producing Caballito property and the highly prospective Maria Reyna property. The company commenced early exploration activities at Maria Reyna and Caballito after completing a surface rights exploration agreement with the community of Uchucarcco in August 2022. As part of the drill permitting process, environmental impact assessment (EIA) applications were submitted for the Maria Reyna property in November 2023 and for the Caballito property in April 2024. The EIA for Maria Reyna was approved by the government in June 2024 and the Caballito EIA was approved in September 2024. This represents one of several steps in the drill permitting process, which is expected to be completed in 2025. Surface mapping and geochemical sampling confirm that both Caballito and Maria Reyna host sulfide and oxide rich copper mineralization in skarns, hydrothermal breccias and large porphyry intrusive bodies, as shown in Figure 1.
Snow Lake Operations
Hudbay’s 100% owned Snow Lake operations in Manitoba include the Lalor gold-copper-zinc mine, the New Britannia gold mill, the Stall base metals concentrator, the 1901 zinc-gold deposit and several satellite deposits. The Lalor mine achieved commercial production in 2014 and reached a significant milestone in December 2024 with the recovery of a total of one million ounces of gold from the mine. Current mineral reserve estimates in Snow Lake total approximately 16 million tonnes with approximately 1.7 million ounces in contained gold and an expected mine life of to 2037. Snow Lake’s life-of-mine production schedule has been optimized for higher mill throughput rates at New Britannia, maximizing gold production and cash flows.
In 2024, record annual gold production of 214,225 ounces was achieved in Snow Lake through a combination of higher metallurgical recoveries at the New Britannia and Stall mills, despite processing lower gold grades year-over-year, and the strategic allocation of more gold ore feed to the New Britannia mill. Annual gold production from Snow Lake is expected to average more than 193,000i ounces over the next three years.
Infill drilling at Lalor in 2024 resulted in the successful conversion of inferred gold resources to mineral reserves, offsetting half of the 2024 mining depletion. There remains another 1.3 million ounces of gold contained in inferred resources in Snow Lake that have the potential to maintain strong annual gold production levels beyond 2030 and further extend the mine life in Snow Lake beyond 2038.
The Snow Lake mineral reserve and resource estimates include the copper-gold WIM deposit, the gold-rich 3 Zone and the zinc-rich Watts, Pen II and Talbot deposits, which have the potential to provide feed for the Stall and New Britannia processing facilities and further extend the life of the Snow Lake operations. Hudbay continues to conduct geophysical and drilling programs on the Snow Lake land package, including the Cook Lake claims and other promising regional targets, as discussed further below.
Current mineral reserves and resources (exclusive of reserves) for Lalor, 1901 and other Snow Lake satellite deposits as of January 1, 2025 are summarized below.
| Lalor Mine and 1901 Deposit | Au Grade | Zn Grade | Cu Grade | Ag Grade | |
|---|---|---|---|---|---|
| Tonnes | |||||
| Mineral Reserve and Resource Estimates1,2,3,4,5,6,7 | (g/t) | (%) | (%) | (g/t) | |
| Gold Zone Reserves | |||||
| Proven – Lalor | 3,250,000 | 5.3 | 0.72 | 0.62 | 32.6 |
| Proven – 1901 | 102,000 | 2.8 | 1.33 | 1.00 | 19.2 |
| Probable – Lalor | 3,701,000 | 4.3 | 0.32 | 1.02 | 24.5 |
| Probable – 1901 | 51,000 | 1.6 | 0.45 | 1.84 | 5.2 |
| Total Proven and Probable - Gold | 7,103,000 | 4.7 | 0.52 | 0.84 | 28.0 |
| Base Metal Zone Reserves | |||||
| Proven – Lalor | 3,631,000 | 2.7 | 5.17 | 0.38 | 30.7 |
| Proven – 1901 | 1,157,000 | 2.3 | 8.31 | 0.31 | 25.4 |
| Probable – Lalor | 574,000 | 1.6 | 5.05 | 0.28 | 34.4 |
| Probable – 1901 | 274,000 | 0.8 | 11.31 | 0.30 | 28.3 |
| Total Proven and Probable – Base Metal | 5,636,000 | 2.4 | 6.10 | 0.35 | 29.9 |
| Total Gold and Base Metal Zone Reserves | |||||
| Proven and Probable – Lalor | 11,156,000 | 3.9 | 2.26 | 0.66 | 29.4 |
| Proven and Probable – 1901 | 1,584,000 | 2.1 | 8.13 | 0.40 | 24.8 |
| Total Proven and Probable (Gold and Base Metal) | 12,740,000 | 3.7 | 2.99 | 0.62 | 28.8 |
| Gold Zone Resources | |||||
| Inferred – Lalor | 1,953,000 | 4.3 | 0.26 | 2.36 | 14.8 |
| Inferred – 1901 | 1,587,000 | 5.5 | 0.30 | 0.85 | 16.6 |
| Total Inferred - Gold | 3,540,000 | 4.8 | 0.28 | 1.68 | 15.6 |
| Base Metal Zone Resources | |||||
| Inferred – Lalor | 560,000 | 1.7 | 5.45 | 0.39 | 31.7 |
| Inferred – 1901 | 312,000 | 1.6 | 5.87 | 0.19 | 32.2 |
| Total Inferred – Base Metal | 873,000 | 1.7 | 5.60 | 0.32 | 31.9 |
| Total Gold and Base Metal Zone Resources | |||||
| Inferred – Lalor | 2,513,000 | 3.7 | 1.42 | 1.92 | 18.6 |
| Inferred – 1901 | 1,900,000 | 4.8 | 1.22 | 0.74 | 19.1 |
| Total Inferred (Gold and Base Metal) | 4,413,000 | 4.2 | 1.33 | 1.41 | 18.8 |
Note: totals may not add up correctly due to rounding.
1 Mineral resources are exclusive of mineral reserves and do not have demonstrated economic viability.
2 Lalor mineral reserves and resources are estimated using a NSR cut-off ranging from C$154 to C$182 per tonne, assuming a long hole mining method and depending on mill destination.
3 Individual stope gold grades at Lalor and 1901 were capped at 10 grams per tonne. This capping method resulted in an approximate 3% reduction in the overall gold reserve grade.
4 1901 mineral reserves and resources are estimated using a minimum NSR cut-off of C$166 per tonne.
5 Mineral resources do not include factors for mining recovery or dilution.
6 Base metal mineral resources are estimated based on the assumption that they would be processed at the Stall concentrator while gold mineral resources are estimated based on the assumption that they would be processed at the New Britannia concentrator. 7 Long-term metal prices of $2,090 per ounce gold, $1.25 per pound zinc, $4.30 per pound copper and $24.30 per ounce silver with an exchange rate of 1.33 C$/US$ were used to confirm the economic viability of the mineral reserve estimates and to estimate mineral resources.
| Snow Lake Regional Deposits - Gold | Au Grade | Zn Grade | Cu Grade | Ag Grade | |
|---|---|---|---|---|---|
| Tonnes | |||||
| Mineral Reserve and Resource | (g/t) | (%) | (%) | (g/t) | |
| Estimates1,2,3,4,5,6,7 | |||||
| Probable Reserves | |||||
| WIM | 2,450,000 | 1.6 | 0.25 | 1.63 | 6.3 |
| 3 Zone | 660,000 | 4.2 | - | - | - |
| Total Probable (Gold) | 3,110,000 | 2.2 | 0.20 | 1.28 | 5.0 |
| Inferred Resources | |||||
| New Britannia | 2,750,000 | 4.5 | - | - | - |
| Birch | 570,000 | 4.4 | - | - | - |
| Total Inferred (Gold) | 3,320,000 | 4.5 | - | - | - |
Note: totals may not add up correctly due to rounding.
1 Mineral resources are exclusive of mineral reserves and do not have demonstrated economic viability.
2 WIM mineral reserves assume processing recoveries of 98% for copper, 88% for gold, and 70% for silver based on processing through New Britannia's flotation and tails leach circuits.
3 3 Zone mineral reserves assume processing recoveries of 85% for gold based on processing through New Britannia's leach circuit. 4 Long-term metal prices of $1,700 per ounce gold, $1.25 per pound zinc, $4.00 per pound copper and $23.00 per ounce silver with an exchange rate of 1.33 C$/US$ were used to confirm the economic viability of the mineral reserve estimates.
4 Mineral resources do not include factors for mining recovery or dilution.
6 Gold mineral resources are estimated based on the assumption that they would be processed at the New Britannia concentrator. 7 New Britannia mineral resource estimates have been reported at a minimum true width of 1.5 metres and with a cut-off grade varying from 2 grams per tonne (at the lower part of New Britannia) to 3.5 grams per tonne (at the upper part of New Britannia).
| Snow Lake Regional Deposits – Base Metal | Au Grade | Zn Grade | Cu Grade | Ag Grade | |
|---|---|---|---|---|---|
| Mineral Reserve and Resource | Tonnes | (g/t) | (%) | (%) | (g/t) |
| Estimates1,2,3,4,5,6,7 | |||||
| Indicated Resources | |||||
| Pen II | 470,000 | 0.3 | 8.89 | 0.49 | 6.8 |
| Talbot | 2,190,000 | 2.1 | 1.79 | 2.33 | 36.0 |
| Total Indicated (Base Metals) | 2,660,000 | 1.8 | 3.04 | 2.01 | 30.9 |
| Inferred Resources | |||||
| Watts | 3,150,000 | 1.0 | 2.58 | 2.34 | 31.0 |
| Pen II | 130,000 | 0.3 | 9.81 | 0.37 | 6.8 |
| Talbot | 2,450,000 | 1.9 | 1.74 | 1.13 | 25.8 |
| Total Inferred (Base Metals) | 5,730,000 | 1.3 | 2.39 | 1.78 | 28.3 |
Note: totals may not add up correctly due to rounding.
1 Mineral resources are exclusive of mineral reserves and do not have demonstrated economic viability.
2 Mineral resources do not include factors for mining recovery or dilution.
3 Base metal mineral resources are estimated based on the assumption that they would be processed at the Stall concentrator. 4 Watts and Pen II mineral resources were initially estimated using metal price assumptions that vary marginally over the assumptions used to estimate mineral resources at Lalor. In the Qualified Person’s opinion, the combined impact of these small variations does not have any impact on the mineral resource estimates.
5 Watts mineral resources are estimated using a minimum NSR cut-off of C$150 per tonne, assuming processing recoveries of 90% for copper, 80% for zinc, 70% for gold and 70% for silver.
6 Pen II mineral resources are estimated using a minimum NSR cut-off of C$75 per tonne.
7 The above resource estimates table includes 100% of the Talbot mineral resources reported by Rockcliff Metals Corp. in its 2020 NI 43-101 technical report published on SEDAR+.
Snow Lake Exploration Program – Executing Threefold Strategy
Hudbay continues to execute the largest exploration program in Snow Lake in the company’s history through extensive geophysical surveying and multi-phased drilling campaigns as part of its threefold exploration strategy.
1) Near-Mine Exploration to Further Increase Near-term Production and Extend Mine Life
The company is testing mineralized extensions of the Lalor and 1901 deposits to increase mineral reserves and resources, providing near-term production growth and long-term mine life extension potential.
1901 Deposit Step-out Drilling Confirms Down Plunge Copper-Gold Extensions
The 2024 drilling activities at the 1901 deposit targeted down plunge extensions of the ore body with five step-out holes drilled beyond the known extent of the mineralization, as shown in the images provided in Figure 2. All five of the stepout holes intersected copper-gold mineralization, including:
- Hole NUX0006 intersected 8.6 metres at 2.6 grams per tonne gold and 1.5% copper
- Hole NUX0007 intersected 3.2 metres at 8.3 grams per tonne gold and 1.8% copper
- Hole NUX0008 intersected 2.5 metres at 4.4 grams per tonne gold and 14.3% copper
In addition to the copper-gold extensions, a recent drill hole on the face of the 1901 exploration drift, directed towards the planned drift extension, intersected zinc-rich massive sulphides 20 metres earlier than expected. This positive outcome further reinforces the company’s target of achieving first ore from the 1901 deposit in the second quarter of 2025.
Additional exploration drilling is planned for 2025 targeting additional step-out drill holes to potentially extend the ore body and infill drilling to convert inferred mineral resources in the gold lenses to mineral reserves.
Lalor Northwest Drilling Confirms Copper-Gold Mineralized Zones
At Lalor Northwest, follow-up drilling in the second half of 2024 confirmed the potential for a new gold-copper discovery located approximately 400 metres from the existing Lalor underground infrastructure. Several 2024 intersections have helped establish the geometry of this new discovery, including:
- Hole CH2406 intersected 9.3 metres at 3.0% copper and 6.2 grams per tonne gold
- Hole CH2408 intersected 3.5 metres at 2.6% copper and 3.8 grams per tonne gold
- Hole CH2410 intersected 9.9 metres at 1.4% copper and 1.4 grams per tonne gold
- Hole CH2411 intersected 3.7 metres at 1.3% copper and 16.4 grams per tonne gold
The company plans to continue to drill Lalor Northwest in 2025 through a surface drill program that is focused on testing the extent of the mineralization, as shown in Figure 3.
2) Testing Regional Satellite Deposits to Utilize Available Processing Capacity and Increase Production
Hudbay increased its land package by more than 250% in 2023 through the acquisition of Rockcliff Metals Corp. (“Rockcliff”), which included the addition of several known deposits located within trucking distance of the Snow Lake processing infrastructure. These newly acquired deposits, together with several deposits already owned by Hudbay in Snow Lake, have created an attractive portfolio of regional deposits in Snow Lake, as shown in Figure 4, including:
- Talbot – Consolidated 100% ownership of this copper-zinc-gold rich deposit through the Rockcliff acquisition. Rockcliff estimated indicated mineral resources of 2.2 million tonnes at 2.3% copper, 1.8% zinc and 2.1 grams per tonne gold.
- Rail – Acquired through Rockcliff, Hudbay’s 2024 drill program yielded new intersections of high-grade coppergold mineralization. These results will be combined with historical drilling results on the property to update the geological model and assess its economic potential.
- Pen II – Hudbay consolidated land adjacent to this low tonnage, near surface, high-grade zinc deposit through the Rockcliff acquisition. Rockcliff intersected mineralization down-dip from Hudbay’s deposit and identified a deep geophysical conductive plate.
- Watts – A copper-zinc-rich deposit located near existing powerlines and 100 kilometres by road from the Stall mill. Drilling by Hudbay in 2019 successfully extended the known high-grade copper mineralization.
- 3 Zone – Acquired by Hudbay in 2015, this gold-rich deposit is located three kilometres from the New Britannia mill and is expected come into production after the Lalor deposit is depleted.
- WIM – Acquired by Hudbay in 2018, this copper-gold deposit is located 15 kilometres from the New Britannia mill and is expected to come into production after the Lalor deposit is depleted.
With the recent strong performance from the New Britannia mill operating at above 2,000 tonnes per day, the company has been increasing the amount of Lalor ore sent to New Britannia which has freed up processing capacity at the Stall mill. There is approximately 1,500 tonnes per day of available capacity at the Stall mill which can be utilized by the regional satellite deposits to increase production. The regional satellite deposits also have the potential to extend the life of the Snow Lake operations beyond 2038.
3) Exploring Large Land Package for New Anchor Deposit to Significantly Extend Mine Life
Large Modern Geophysics Program
A majority of the newly acquired Cook Lake and former Rockcliff claims have been untested by modern deep geophysics, which was the discovery method for the Lalor deposit. A large geophysics program is currently underway consisting of surface electromagnetic surveys using cutting-edge techniques that enable the team to detect targets at depths of almost 1,000 metres below surface. Figure 4 outlines the regional geophysics that have been completed to date. The planned geophysics program in 2025 is the largest geophysics program in Hudbay’s history and includes 800 kilometres of ground electromagnetic surveys and an extensive airborne geophysics survey.
Copper Mountain Mine
Hudbay’s 75% owned Copper Mountain mine is an open pit copper mine in southern British Columbia, which also produces gold and silver as by-product metals. Hudbay acquired Copper Mountain as part of its acquisition of Copper Mountain Mining Corporation in June 2023 and Mitsubishi Materials Corporation (“MMC”) holds the remaining 25% interest. On March 27, 2025, Hudbay announced that it entered into an agreement with MMC to acquire MMC’s 25% minority interest in Copper Mountain for an upfront cash payment of $4.5 million and up to $39.75 million in deferred and contingent cash payments (the “MMC Transaction”). In addition, Hudbay will be solely responsible to settle any of Copper Mountain’s outstanding obligations, including an intercompany loan owing to Hudbay, of which 25% represents approximately $104 million. The MMC Transaction is accretive to Hudbay’s net asset value per share. Once completed, Hudbay will be the 100% owner of the Copper Mountain mine.
Current mineral reserve estimates at Copper Mountain total 346 million tonnes at 0.25% copper and 0.12 grams per tonne gold with approximately 850 thousand tonnes of contained copper and 1.3 million ounces of contained gold. The current mineral reserve estimates continue to support a mine life until 2043, with significant upside potential for future resource conversion and mine life extension beyond 19 years through an additional 125 million tonnes of measured and indicated resources at 0.21% copper and 0.10 grams per tonne gold and 372 million tonnes of inferred resources at 0.25% copper and 0.13 grams per tonne gold, in each case, exclusive of mineral reserves.
Since acquiring Copper Mountain in June 2023, Hudbay has been focused on advancing operational stabilization and optimization plans, including opening up the mine by re-activating the full mining fleet, adding additional haul trucks, adding additional mining faces, optimizing the ore feed to the plant and implementing plant improvement initiatives that mirror Hudbay's successful processes at Constancia. These investments have successfully increased the total tonnes moved and resulted in stronger mill performance as demonstrated by high mill availability of 92% and copper recoveries of 82% in 2024, compared to 85% and 80%, respectively, in 2023.
In 2025, the planned conversion of the third ball mill to a second SAG mill is anticipated to result in the ramp-up of mill throughput in the second half of the year. The mill throughput is anticipated to ramp up towards 50,000 tonnes per day in 2026. Annual production at the British Columbia operations is expected to average approximately 44,000i tonnes of copper and 28,600i ounces of gold over the next three years.
Current mineral reserves and resources (exclusive of reserves) for Copper Mountain as of January 1, 2025 are summarized below.
| Copper Mountain Mine | ||||
|---|---|---|---|---|
| Cu Grade | Au Grade | Ag Grade | ||
| Tonnes | ||||
| Mineral Reserve and Resource | ||||
| (%) | (g/t) | (g/t) | ||
| Estimates1,2,3,4,5,6 | ||||
| Reserves | ||||
| Proven | 172,900,000 | 0.269 | 0.124 | 0.72 |
| Probable | 173,100,000 | 0.222 | 0.109 | 0.62 |
| Total proven and probable | 346,000,000 | 0.245 | 0.116 | 0.67 |
| Resources | ||||
| Measured | 31,900,000 | 0.213 | 0.092 | 0.72 |
| Indicated | 92,800,000 | 0.209 | 0.109 | 0.66 |
| Total measured and indicated | 124,700,000 | 0.210 | 0.105 | 0.68 |
| Inferred | 372,200,000 | 0.250 | 0.128 | 0.60 |
Note: totals may not add up correctly due to rounding.
1 Mineral resource estimates are exclusive of mineral reserves. Mineral resources are not mineral reserves as they do not have demonstrated economic viability.
2 Mineral reserves are estimated using a 0.1% copper cut-off grade and assuming metallurgical recoveries (applied by ore type) of 86% for copper, and 68% for gold and silver on average for the life of mine.
3 Long term metal prices of $4.15 per pound copper, $1,900 per ounce gold and $23.00 per ounce silver were used to confirm the economic viability of the mineral reserve estimates and to estimate mineral resources.
4 Mineral resource estimate tonnes and grades constrained to a Lerch Grossman revenue factor 1 pit shell.
5 Mineral resources are estimated using 0.1% copper cut-off grade.
6 Mineral reserve and resource estimates presented on a 100% basis. Hudbay currently holds a 75% interest in the Copper Mountain mine and has recently entered into an agreement to acquire the remaining 25% interest.
3-Year Production Outlook
Hudbay has affirmed its 2025 production guidance as issued on February 19, 2025, and has issued new 2026 and 2027 production guidance in connection with updated life-of-mine models to support annual reserves and resource estimates. Consolidated copper production over the next three years is expected to average 144,000i tonnes, representing an increase of 4% from 2024 levels. The increase is due to higher expected copper production in British Columbia as a result of mill throughput ramp-up throughout 2025 and 2026 and higher grades in 2027 from the accelerated stripping schedule, which more than offsets the depletion of the high-grade Pampacancha deposit in Peru at the end of 2025. Consolidated gold production over the next three years is expected to average 253,000i ounces, reflecting higher-than-expected annual gold production levels in Manitoba, as compared to prior guidance, a result of continued strong operating performance in Snow Lake and a contribution from Pampacancha high grade gold zones in 2025.
Peru’s three-year production guidance reflects stable copper production of approximately 88,000i tonnes per year, as the depletion of higher copper grades from Pampacancha in 2025 is offset by higher expected throughput levels in 2026 and 2027 with mill improvement projects, including the installation of a pebble crusher. Total mill ore feed from Pampacancha is expected to be approximately 25% in 2025, lower than the typical one-third in prior years as Pampacancha approaches depletion. Gold production over the next three years is expected to average 31,000i ounces, lower than 2024 levels as additional high grade gold benches were mined at Pampacancha in late 2024, ahead of schedule, resulting in gold production exceeding 2024 guidance levels, as well as the depletion of the higher grade Pampacancha deposit in late 2025.
Manitoba’s three-year production guidance reflects continued strong gold production levels averaging 193,000i ounces per year. The impressive operating performance has resulted in 2025 gold production guidance being 8% higher than the previous 2025 guidance of 185,000i ounces, and 2026 gold production guidance being 3% higher than the previous 2026 guidance of 185,000i ounces. Similarly, the midpoint of the 2027 gold production guidance is 17% higher than the production in the most recent technical report. The production guidance anticipates Lalor operating at 4,500 tonnes per day supplemented by 45,000 tonnes of ore feed from the 1901 deposit in 2025 as the company confirms the optimal mining method. New Britannia mill throughput is expected to continue to exceed initial expectations and operate at 2,000 tonnes per day starting in 2025, far exceeding its original design capacity of 1,500 tonnes per day. Zinc production is expected to decline over the next two years as the Lalor mine continues to prioritize higher grade gold and copper zones and then start to increase in 2027 with initial production from the zinc zones at the 1901 deposit.
British Columbia’s three-year production guidance reflects sequentially higher annual copper production averaging 44,000i tonnes per year, a 67% increase from 2024 as a result of mill throughput ramp-up in the second half of the year from several mill initiatives, including the planned conversion of the third ball mill to a second SAG mill, and higher grades from the accelerated stripping program. The mill throughput ramp-up reflects the first half of 2025 at similar throughput levels seen in 2024 with improvements to throughput in the second half of 2025 concurrent with the completion of the SAG mill conversion project, ramping up towards 50,000 tonnes per day in 2026. The Copper Mountain production guidance ranges are wider than typical ranges and coincide with the operation ramp up activities over the three-year optimization period. Upon completion of Hudbay’s optimization activities, 2027 copper production is expected to be 60,000i tonnes, representing a 127% increase from 2024. 2027 expected copper production is also 20% higher than the production in the most recent technical report as a result of the deferral of higher grades from 2026 to 2027 in connection with the current accelerated stripping schedule.
| 3-Year Production Outlook | 2025 Guidance | 2026 Guidance | 2027 Guidance | |
| Contained Metal in Concentrate and | ||||
| Doré1 | ||||
| Peru Copper tonnes 80,000 - 97,000 76,000 - 100,000 76,000 - 100,000 Gold ounces 49,000 - 60,000 16,000 - 21,000 17,000 - 23,000 Silver ounces 2,475,000 - 3,025,000 1,610,000 - 2,070,000 1,415,000 - 1,915,000 Molybdenum tonnes 1,300 - 1,500 1,300 - 1,500 1,400 - 1,800 Manitoba Gold ounces 180,000 - 220,000 170,000 - 210,000 170,000 - 210,000 Zinc tonnes 21,000 - 27,000 21,000 - 25,000 21,000 - 27,500 Copper tonnes 9,000 - 11,000 11,000 - 13,000 12,000 - 14,000 Silver ounces 800,000 - 1,000,000 750,000 - 950,000 1,000,000 - 1,200,000 British Columbia2 Copper tonnes 28,000 - 41,000 30,000 - 45,000 50,000 - 70,000 Gold ounces 18,500 - 28,000 20,000 - 30,000 30,000 - 45,000 Silver ounces 245,000 - 365,000 230,000 - 345,000 455,000 - 680,000 Total Copper tonnes 117,000 - 149,000 117,000 - 158,000 138,000 - 184,000 Gold ounces 247,500 - 308,000 206,000 - 261,000 217,000 - 278,000 Zinc tonnes 21,000 - 27,000 21,000 - 25,000 21,000 - 27,500 Silver ounces 3,520,000 - 4,390,000 2,590,000 - 3,365,000 2,870,000 - 3,795,000 Molybdenum tonnes 1,300 - 1,500 1,300 - 1,500 1,400 - 1,800 |
1 Metal reported in concentrate and doré is prior to smelting and refining losses or deductions associated with smelter terms. 2 Represents 100% of the production from the Copper Mountain mine. Hudbay currently holds a 75% interest in the Copper Mountain mine and recently entered into an agreement to acquire the remaining 25% interest.
Copper World Project
The 100% owned Copper World project is located in Pima County, Arizona, approximately 50 kilometres southeast of Tucson. The Copper World project includes the large East deposit (formerly known as the Rosemont deposit) together with new deposits that were defined after the completion of an expanded drill program following a successful initial drill program in 2020. A new resource model was completed for the preliminary economic assessment (“PEA”) of Copper World in 2022, which contemplated a two-phased mine plan with Phase I as a standalone operation requiring state and local permits only and Phase II expanding onto federal lands requiring federal permits.
In September 2023, Hudbay released its enhanced pre-feasibility study (“PFS”) for Copper World reflecting the results of further technical work on Phase I of the project. Phase I has a mine life of 20 years, which is four years longer than the Phase I mine life that was presented in the PEA, largely due to an increase in the capacity for tailings and waste deposition as a result of optimizing the site layout. Phase II is expected to involve an expansion on to federal lands with a significantly longer mine life and enhanced project economics. Phase II would be subject to the federal permitting process and was not included in the PFS results.
Hudbay has received all three key state permits required for Copper World development and operation:
- Mined Land Reclamation Plan – Completed – the Mined Land Reclamation Plan was initially approved by the Arizona State Mine Inspector in October 2021 and was subsequently amended and approved to reflect a larger private land project footprint. This approval was challenged in state court, but the challenge was dismissed in May 2023.
- Aquifer Protection Permit – Completed – the Aquifer Protection Permit was received on August 29, 2024 from the ADEQ following a robust process that included detailed analysis by the agency and Hudbay, along with a public comment period that was completed in the second quarter of 2024.
- Air Quality Permit – Completed – the Air Quality Permit was received on January 2, 2025 from the ADEQ following a similarly robust process, including a public comment period that concluded in the third quarter of 2024. An administrative appeal was filed by certain opponents in late January, as expected, and the company is confident the permit will be upheld, similar to the project’s other state-level permits.
Based on the PFS, Phase I contemplates average annual copper production of 85,000 tonnes over a 20-year mine life, at average cash costsii and sustaining cash costsii of $1.47 and $1.81 per pound of copper, respectively. A variable cut-off grade strategy allows for higher mill head grades in the first ten years, which increases annual production to approximately 92,000 tonnes of copper at average cash costsii and sustaining cash costsii of $1.53 and $1.95 per pound of copper, respectively.
At a copper price of $3.75 per pound, the after-tax net present value (“NPV”) of Phase I using an 8% discount rate is $1.1 billion and the internal rate of return (“IRR”) is 19%. The valuation metrics are leveraged to higher copper prices and at a price of $4.25 per pound, the after-tax NPV (8%) of Phase I increases to $1.7 billion, and the IRR increases to 25.5%.
Copper World is one of the highest-grade open pit copper projects in the Americas with proven and probable mineral reserves of 385 million tonnes at 0.54% copper. There remains approximately 60% of the total copper contained in measured and indicated mineral resources (exclusive of mineral reserves), providing significant potential for Phase II expansion and mine life extension. In addition, the inferred mineral resource estimates are at a comparable copper grade and provide significant upside potential.