HudBay receives favourable Arizona court ruling
HudBay Minerals Inc. [HBM-TSX, NYSE] has received a favourable decision from a U.S. District Court in relation to the company’s Copper World copper-molybdenum-silver deposit in Arizona.
Hudbay has said it sees the Copper World discovery as a “very interesting, either alternative or add-on” to the adjacent Rosemont project, which has been in legal limbo for over two years after a U.S. Federal Court blocked construction. The court overturned the Final Record of Decision issued by the U.S. Forest Service in mid-2017.
In a press release that came after the close of trading on May 24, 2022, Hudbay said the District Court ruled in favour of the company on all issues, including that Copper World and Rosemont are not connected under the National Environmental Policy Act (NEPA) and, therefore, that the Army Corps of Engineers (ACOE) does not have an obligation to include Copper World as part of its NEPA review of Rosemont.
The District Court also granted Hudbay’s motion to dismiss the Copper World preliminary injunction request by the plaintiffs in the two lawsuits challenging the Section 404 Clean Water Act permit for Rosemont on the basis that the lawsuits are moot after the company surrendered its 404 permit back to the ACOE in April 2022.
“The ACOE has never determined that there are jurisdictional waters of the U.S. on the Copper World site and Hudbay has independently concluded through its own scientific analysis that there are no such waters in the area,” the company said.
HudBay it recently tabled a maiden resource estimate, Hudbay said Copper World hosts an indicated mineral resource of 272 million tonnes at 0.36% copper and an inferred resource of 142 million tonnes at 0.36% copper, containing 3.3 billion pounds of copper.
This resource estimate includes near surface, higher grade indicated mineral resources of 96 million tonnes at 0.57% copper and inferred resources of 31 million tonnes at 0.71% copper, containing 1.7 billion pounds of copper with the potential to be mined earlier in the life of a production cycle.
Copper World is made up of seven discrete deposits that contain a mix of both sulphide and oxide ore.
The company said a preliminary economic assessment (PEA) for the project remains on track for the second quarter of 2022, to be immediately followed by a pre-feasibility study. The PEA is expected to reflect a 15-year mine life and incorporate a two-phase mine plan with a first phase reflecting a stand-along operation with processing infrastructure on Hudbay’s private land and mining occurring on portions of the deposits located on patented mining claims.
The second phase is expected to extend the mine life and incorporate an expansion onto federal lands to mine the entire Rosemont and Copper World deposits.
The company said it believes that District Court’s decision, together with the May 12, 2022 decision from the 9th Circuit Court of Appeals, clarifies the permitting path for Copper World, including the requirements to receive federal permits for the second phase under existing mining regulations.
On May 24, 2022, Hudbay shares closed at $7.21 and currently trade in a 52-week range of $11.17 and $6.48.