HudBay Plans Closures of Copper Smelter and Refinery

HudBay Minerals recently announced that it will close its copper smelter in Flin Flon, Manitoba, by mid-2010. The
smelter has capacity to produce about 90,000 mt/y of copper anode. (Photo courtesy of HudBay Minerals)
HudBay Minerals announced in June that it expects to close its copper smelter in Flin Flon, Manitoba, before July 1, 2010, and its copper refinery in White Pine, Michigan, shortly thereafter. The Flin Flon copper smelter is part of a mining and metals producing complex that includes the 777 and Trout Lake mines, a concentrator and a zinc plant, in addition to the smelter. The closure applies only to the smelter, which processes concentrates produced by HudBay mines as well as purchased concentrates. Copper anodes produced by the smelter are shipped by rail to White Pine, where they are refined into market-standard copper cathodes.

The copper smelter has capacity to produce about 90,000 mt/y of anodes. In 2008, it produced approximately 82,500 mt, of which 7,800 mt were produced from recycled White Pine spent anode. Approximately 32% of the concentrate treated at the copper smelter in 2008 was purchased concentrate.

Following closure of the smelter, concentrates produced by HudBay mines will be sold to other smelters. The company expects to have sales arrangements for the concentrates in place by the time the smelter closes. HudBay is building a concentrate filtration plant that will enable it to ship its copper concentrates off-shore, if necessary.

Reclamation costs are not currently an issue for the smelter and will be required only when the entire Flin Flon metallurgical complex is ultimately shut down.

Following the announcement of the smelter closure, Peter Jones, HudBay’s CEO, told attendees at the company’s annual meeting that “Hud-Bay will pursue a strategy defined by two broad themes.” One theme, he said, will be to optimize operations in HudBay’s traditional home base of Manitoba. “We will grow our principal operating platform in the Flin Flon Greenstone Belt, which will continue to be our cornerstone.”

The strategy for Manitoba includes closing the copper smelter, continuing to evaluate reopening the Chisel North mine, continuing exploration in the Flin Flon Greenstone Belt and aggressively pursuing development of the Lalor deposit.

“The strategic plan will only be fully realized by growing beyond our Manitoba base,” Jones said. “This second avenue of growth will include the company’s Fenix nickel property in Guatemala and potential acquisition opportunities worldwide.”

Jones described several key initiatives in implementing HudBay’s plan. A decision on the next phase of development for the Lalor project is expected in 2009. Copper concentrate sales arrangements are also expected by the end of 2009, to support the closure of the copper smelter by July 1, 2010. A revised project plan for the Fenix project is expected in early 2010, and the company is continuing to pursue acquisition opportunities.

As featured in Womp 2009 Vol 06 -