Hudbay identifies major deposits with economic potential adjacent to its proposed Rosemont open pit copper mine

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Toronto-based Hudbay Minerals Inc. has identified an additional 591 million tons of copper-bearing rock in deposits adjacent to its proposed mile-wide, half-mile deep Rosemont open pit copper mine that it says could be economically mined in the future.

The additional resources were disclosed in a March 31 feasibility study required by Canadian regulators and used to obtain financing for the project. The disclosure of additional resources equal to what the company already plans to extract from the pit mine raises questions about the scope and lifespan of the project and resulting adverse impacts.

The currently proposed Rosemont pit is located within a larger area the technical report defines as the “resource pit shell.” The resource pit shell extends over the Santa Rita’s ridgeline and down the western slope. The additional 591 million tons of mineralized rock lies outside the Rosemont pit but within the resource pit shell.

The Rosemont mine would be constructed on the northeastern flank of the Santa Rita Mountains on the Coronado National Forest southeast of Tucson. The mining would generate 1.25 billion tons of waste rock and mine tailings. Hudbay intends to dump the waste into 700-foot high “earthforms” spread across 3,000 acres of national forest.

The feasibility study also raises the estimated cost of constructing the mine complex to $1.9 billion, up 21 percent from the company’s $1.5 billion projection made in Feb. 2015. Augusta Resource, the previous owner of the Rosemont site, estimated the mine would cost $1.2 billion in 2012 and $890 million in 2009.

Hudbay’s current plans call for mining 592 million tons of ore from the open pit that would contain 5.3 billion pounds of copper, 142 million pounds of molybdenum and 79 million ounces of silver. The company states it plans to process 90,000 tons of ore per day and produce an average of 279 million pounds of copper per year over the estimated 19-year life of the pit.

The Rosemont Mine site after 19 years of open pit mining is completed.

(Click on the graphic to enlarge.) The Rosemont Mine site after 19 years of open pit mining is completed.

The possibility that Hudbay could mine up to an additional 591 million tons of copper-bearing rock after mining in the pit is completed raises questions of where the waste rock and tailings would be deposited. Expanding the footprint of the mine would also have significant impacts on water resources and the landscape that hosts a dozen threatened and endangered species and the economic impacts that will follow (e.g., water resources, ecotourism).

Complex environmental studies including the Environmental Impact Statement and the numerous state and federal permits have been based on Hudbay’s plans to develop the open pit mine. The permits and environmental studies do not include the potential impacts of additional mining outside of the Rosemont pit.

(Click on the graphic to enlarge.) The dotted line encompasses the resource pit shell. The actual Rosemont pit would be constructed within the the resource pit shell.

(Click on the graphic to enlarge.) The dotted line encompasses the resource pit shell. The actual Rosemont pit would be constructed within the the resource pit shell.

The technical report states the copper-bearing rock has the “potential for economic extraction after the current mineral reserves estimate (the ore located within the pit) has been mined and processed.”

The report does not identify the exact location of the additional resources outside the proposed pit, nor does it provide a plan of how the copper-bearing rock would be mined.

The feasibility study states the economic value of mineral resource estimates can be impacted by a number of factors including:

  • Long-term commodity price assumptions
  • Operating cost assumptions
  • Metal recovery assumptions
  • Changes to the tonnage and grade estimates may vary as a result of more drilling, new assay, and tonnage factor information.

The current mining plan is projected to initially employ 337 workers in the pre-production period increasing to a maximum of 459 employees in year seven.

Hudbay states it expects to use 6,000 acre-feet of water per year (an acre-foot equals 325,581 gallons) pumped from wells adjacent to the Santa Cruz River. The water would be sent through a pipeline to the mine site where processing facilities will use water at a rate of 3,500 gallons to 5,000 gallons per minute.

(Click on the graphic to enlarge.) Hudbay owns mining patents for major copper deposits including Rosemont, Broadtop Butte, Copper World and Peach Elgin.

(Click on the graphic to enlarge.) Hudbay owns mining patents for major copper deposits including Rosemont, Broadtop Butte, Copper World and Peach Elgin.

Based on an average copper price of $3/pound, Hudbay states the Rosemont mine will generate $13.4 billion in revenue over the life of the mine. After all expenses, including $718 million in taxes, the company expects to generate $2.903 billion in “after-tax free cash flow.”

Hudbay still needs a Clean Water Act permit issued by the U.S. Army Corps of Engineers and final approval from the Coronado National Forest before construction could begin. The Army Corps’ district office recommended denial of the Section 404 CWA permit last July. A final decision is expected later this year.

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7 Responses to Hudbay identifies major deposits with economic potential adjacent to its proposed Rosemont open pit copper mine

  1. If the god that the people that run Hudbay worship is money then I fully understand why they desperately want the Rosemont Mine to succeed.

  2. Dennis Winsten says:

    “Earthforms” a new spin on tailings. Hudbay promises to “re-seed”the “earthforms”. Check out the abundant foliage on the green valley tailings.

  3. ALAN JOHNSON says:

    This new feasibility study produced by HUDBAY makes the feasibility study produced by AUGUSTA , as part of the original permit application , effectively nul and void . HUDBAY’S proposed mine plan for the ROSEMONT PROJECT expands the mine plan that was originally submitted . This will put greater pressure on all permitting issues regarding water , environment , eco-systems , etc . Relocating trails to suit HUDBAY’S desires needs is hardly appropriate .

    The open pit design will produce a huge open sump that will draw down the existing water table over an area far beyond the perimeter of the proposed pit shell . Mining deeper will produce more waste rock resulting in higher and wider waste piles . This may also lead to higher and wider tailing piles . When you add this up , you will have a obscene desecration of what , today , is a beautiful and pristine natural landscape for all to share and enjoy . Call it the slaughter of MOTHER NATURE’S gift to all . What price do you place on this desecration ? HUDBAY , in their report , have listed $25 million for reclamation and $9million for closure when the mine life of 19 years expires . This would appear to be inadequate considering the size of the proposed pit , tailing piles and waste rock dumps left behind . Also $34 million today will not be worth the same 19 years down the road .

    HUDBAY has yet to carry out a bulk sample testing program from which to determine the optimum processing characteristics of the varied types of mineralization reported . What are the toxic elements(arsenic , cadmium , selenium , mercury , fluorine , etc.) that will be contained in the tailings and exposed to the environment ?

    HUDBAY appears overly optimistic regarding metal prices and the economic climate ahead . The projection of prosperity for all those related to the ROSEMONT PROJECT , may amount to very little . Mining companies are great speculators , promoters and wishful thinkers .

    HUDBAY has already stated that they will go to court over the permitting if they do not get what they want . They have already indicated that they have retained the services of those in the know to lobby for them .

    Pressure must be brought to bear on all of the GOVERNMENT AGENCIES involved in the permitting process in order that a permit is not granted to HUDBAY for the development of the ROSEMONT PROJECT .

  4. Richard Calabro says:

    Thank you very much to Save The Scenic Santa Ritas for this excellent report on the new feasibility study by HudBay. And thank you also to Alan Johnson for your follow-up reply. It is much appreciated .

  5. Nancy Fahringer says:

    Thanks for the excellent update. The sentence: “Pressure must be brought to bear on all the Government agencies involved in the permitting process” implies that it might help if we expressed our concerns to these agencies. Could you please suggest to whom we should write or email? Is this the best time to exert whatever pressure mere citizens can apply? Would it help to contact the AZ Daily Star’s Tim Steller to generate support? Thanks.

  6. ALAN JOHNSON says:

    ” BRINGING PRESSURE TO BEAR ” . Every citizen has a right to express their views and opinions . Arizona is the ” COPPER STATE ” of the ” UNION ” and politicians at all levels have build their case for development and prosperity on this fact . However , individuals have the right to oppose the ” ROSEMONT PROJECT ” ! Letters , emails , petitions , voices , etc , delivered to the politicians and policy makers by whatever means , expressing opposition to the ” ROSEMONT PROJECT ” , is in order . Keep in mind , however , that there those who strongly support the ” ROSEMONT PROJECT ” .

  7. ALAN JOHNSON says:

    The time to act is NOW .