Hudbay Secures Fleet Financing

View of construction activity in June on crushed ore stockpile withdrawal tunnels that will provide feed to
ball mills at Hudbay Minerals’ Constancia copper project. (Photo courtesy of Hudbay Minerals)
Hudbay Minerals has received a commitment from Caterpillar Financial to provide an equipment financing facility for the mobile fleet at Hudbay’s Constancia openpit copper project in southern Peru. The facility will cover approximately $130 million of equipment manufactured by Caterpillar and others, subject to completion of definitive documentation. Loans pursuant to the facility are expected to have a term of six years and to be secured by the Constancia mobile fleet. Completion of the facility is expected in the third quarter of 2013.

Construction at Constancia began in August 2012. The development schedule calls for nine quarters of construction, initial production in late 2014, and full production beginning in the second quarter of 2015.

Production of contained copper in concentrate is expected to average approximately 118,000 mt/y during the first five years of production and 77,000 mt/y in subsequent years. Mine life will exceed 16 years. The Constancia concentrate will include molybdenum, silver and gold byproduct credits.

Capital expenditures for the Constancia project are budgeted at $1.5 billion. As of May 1, approximately $480 million of these costs had been incurred, and Hudbay had entered into an additional $534 million in project commitments.

The mine fleet of 18 haul trucks is scheduled for delivery between June 2013 and August 2014, and the three hydraulic shovels are slated for delivery in August 2013, September 2013 and January 2014, respectively. Pre-stripping activities are scheduled to begin late in 2013.

As featured in Womp 2013 Vol 07 -