Constancia

In 2011, Hudbay acquired Norsemont Mining Inc. and its wholly owned Constancia copper porphyry project located in southern Peru. Consistent with projections provided in July 2013, results from the completion of a revised Constancia capital cost estimate indicate total costs to project completion of US$1.708 billion, with initial production expected in late 2014 and commercial production in the second quarter of 2015.

Click here to view a time lapse video of Constancia.

Key Facts

  • Location: South-eastern Andes of Peru, in the Chamaca and Livitaca Districts, Province of Chumbivilcas, Department of Cusco
  • Ownership: 100%
  • Property: 22,516 hectares in 36 mineral concessions
  • Primary metals: copper
  • Secondary metals: molybdenum, silver
  • Contemplated type of mining: open pit

Life of Mine1

Ownership

100%

Daily ore throughput

80k tpd

Avg. annual Cu production2

82k tonnes

Cash cost per Cu lb3

US$1.25/lb

Mine and mill unit cost4

US$7.48/tonne

Avg. annual sustaining capital

US$47 million

Mine life

22 years

Source: Hudbay company disclosure

1.LOM as per NI 43-101 Technical Report on the Constancia Project dated October 15, 2012 and subsequent updates to project estimates in public disclosure
2.Production is contained metal in concentrate
3.Net of by-products. Includes impact of silver and gold streams. Assumed metal prices per the Silver Wheaton stream agreement are as follows: Gold US$400/oz, Silver US$5.90/oz. Other metal price assumptions include: Molybdenum 2014-US$12/lb, 2015-US$13/lb, 2016-US$13/lb, LT-US$13.50/lb; Gold 2014-US$1,350/oz, 2015-US$1,325/oz, 2016-US$1,300/oz, 2017-US$1,275/oz, LT-US$1,250/oz
4.Combined mine and mill unit operating costs per tonne of ore processed

Project Status

At Hudbay’s 100% owned Constancia copper project in Peru, the project was approximately 94% complete on a proportion spent basis at the end of September 2014. Of the total project capital budget of US$1.7 billion, Hudbay has incurred approximately US$1.6 billion in costs to September 30, 2014 and entered into an additional approximately US$64 million in commitments.

The power transmission line to site has been commissioned, plant commissioning activities are well underway and pre-stripping is well advanced, with sufficient broken ore available for the initial requirements of the ramp-up schedule.

Crusher and conveyance testing is underway and ore commissioning at the crusher has been completed. Major mechanical installation is complete in the grinding area, with work focused on finalizing piping and electrical installation. Tank and flotation cell leak testing is near completion in the flotation and thickening area.

All major reagents and consumables are now under contract in support of operations. All required start-up water is captured and the tailings dam has reached its milestone height in preparation for production. The project workforce is in a ramp down phase with a significant number of heavy civil earth works contractors being demobilized.  Staffing of the technical and labour workforce is proceeding as planned and necessary training is underway and on schedule. In addition, the concentrate transport contract has been awarded and mine offices and maintenance facilities are now complete.

The project remains on track for first concentrate production in the fourth quarter of 2014 and commercial production in the second quarter of 2015.

 

Peru Mineral Reserves as at January 1, 2014

 

Category

Tonnes

Cu (%)

Mo (g/t)

Au (g/t)

Ag (g/t)

Constancia

 

 

 

 

 

Proven

483,000,000

0.32

93

0.040

3.04

Probable

94,000,000

0.22

61

0.036

2.77

Pampacancha

 

 

 

 

 

Proven

23,000,000

0.52

142

0.298

4.28

Probable

20,000,000

0.44

159

0.252

3.74

Total Proven

506,000,000

0.33

95

0.052

3.09

Total Probable

114,000,000

0.26

78

0.074

2.94

Total Reserves

620,000,000

0.32

92

0.056

3.07

Note: totals may not add up correctly due to rounding

 

Peru Mineral Resources as at September 30, 2013

 

Category

Tonnes

Cu (%)

Mo (g/t)

Au (g/t)

Ag (g/t)

Constancia

 

 

 

 

 

Measured

68,000,000

0.22

59

0.036

2.17

Indicated

293,000,000

0.20

58

0.033

1.96

Inferred

200,000,000

0.19

51

0.031

1.86

Pampacancha

 

 

 

 

 

Measured

5,000,000

0.41

69

0.243

5.46

Indicated

6,000,000

0.34

98

0.211

4.68

Total Measured & Indicated

372,000,000

0.20

59

0.039

2.09

Total Inferred

200,000,000

0.19

51

0.031

1.86

Note: totals may not add up correctly due to rounding.


(For more detailed information about reserves and resources at Constancia, please see Reserves and Resources.)

Pampacancha Deposit Expanded to the North and West, March 7, 2012

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Pampacancha Exploration Drill Results, August 9, 2011

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August 9, 2011 Cross Section 381 KB
August 8, 2011 Plan Map 846 KB
August 7, 2011 Collar Locations 7 KB
August 6, 2011 Composite Intervals 8 KB

Pampacancha Exploration Drill Results, June 14, 2011

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June 14, 2011 Cross Section 529 KB
June 14, 2011 Plan Map 1.21 MB
June 14, 2011 Pampacancha Results 10 KB

Constancia Project Exploration Drill Results, May 16, 2011

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May 16, 2011 Collar Locations 27 KB
May 16, 2011 Map 1.76 MB

CONSTANCIA PROJECT TECHNICAL REPORT, NOVEMBER 6, 2012

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November 12, 2014 Technical Report 28.36 MB

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