Hudbay’s Emerging Gold Camp in Snow Lake

November 23, 2020

Since our formation in 1927, beginning with our first mines in Flin Flon’s Greenstone Belt, Hudbay Minerals has remained proud of our foundations in Manitoba where we first established the mining expertise and community engagement that distinguish Hudbay to this day. Over the years, Hudbay has successfully discovered, built and operated 26 mines in northern Manitoba. As our operational priorities in Manitoba begin to shift to the Snow Lake region, we are excited to carry forward our new phase of growth, as our reserves, processing capacity and exploration activities expand in Snow Lake to become a meaningful gold complex.

The Manitoba business unit reported solid production and performance in the first half of 2020, which is remarkable considering the external challenges of COVID-19. In response to the pandemic, we have worked collaboratively with our health and safety committees and local health units with a focus on keeping employees and communities safe by implementing a number of layered workplace controls while giving back. In May, we were proud to provide $20,000 to the Snow Lake Family Resource Centre, an organization that provides support, counselling, information, referrals and educational workshops within the Snow Lake area.

After 16 successful years, our 777 mine (copper, zinc, gold, silver) in Flin Flon is approaching the end of its mine life and final production is anticipated in 2022. As we begin to transition our focus in Manitoba to Snow Lake, we trace our strategy back to 2007, when Hudbay discovered Lalor, a volcanogenic massive sulphide deposit that hosts gold, zinc, copper and silver. Lalor was put into full production in 2014 while utilizing processing capacity at our existing Stall mill and as we started developing deeper into the mine, we were able to better define the lower zones which contained higher gold content.

Hudbay released initial details of our Snow Lake gold mine plan in February 2019 that included plans for the refurbishment of the past-producing New Britannia gold mill (located 16 km east of Lalor) on schedule to be completed by the end of 2021. The New Britannia mill will process gold-rich Lalor ore where we anticipate a 93 per cent recovery rate of the gold in Lalor ore, compared with 53 per cent at the Stall mill. Incorporating recent exploration success at Lalor and in the Snow Lake region, we released an updated mine plan in March 2020 projecting a doubling of gold production at Lalor to over 150,000 oz. per year starting in 2022 at first quartile industry all-in sustaining cash costs of $655 per ounce. We are also optimizing the New Britannia project delivery schedule with the potential to produce gold earlier than planned in 2021. Our Lalor mine currently has a mine life of 10 years based on reserves and with the inclusion of regional gold deposits, the total Snow Lake mine life is 18 years. Hudbay’s Snow Lake camp is fast becoming a meaningful low-cost gold producer.

“We are excited for Hudbay’s future in Manitoba. The New Britannia mill refurbishment will significantly grow our gold business and create 60 new jobs in the Snow Lake region,” said Robert Assabgui, Vice President, Manitoba Business Unit at Hudbay. “The investment in New Britannia will help to ensure that Lalor remains a strong, low-cost producer and reliable employer for many years to come.”

As a diversified mining company producing copper concentrate (containing copper, gold and silver) and zinc metal, we continue to be guided by our vision to be a responsible, top-tier operator of long-life, low-cost mines in the Americas while our principles remain informed by the expertise, experience and commitment of our people. Hudbay is extremely grateful for our success in Manitoba and the role our communities have played in helping shape our values of dignity and respect, caring, openness and trust. These values reflect how we will continue to conduct business and run our operations in Manitoba, while giving back to the communities in which we operate.

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