Hudbay doubling gold production in Snow Lake

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This article was published 20/02/2019 (1891 days ago), so information in it may no longer be current.

Hudbay Minerals, which sent Manitoba’s mining sector reeling with the pending closure of its entire Flin Flon mining and smelting operation, is spending $124 million to double gold production in Snow Lake.

The company says refurbishing its New Brittania ore-processing mill, plus newfound gold, copper, zinc and silver deposits at its Lalor mine, is set to more than double gold production to approximately 140,000 ounces annually for the first five years.

Hudbay said its plan supports a further 10-year lifespan for the Lalor mine, with ore from nearby satellite deposits holding the potential to extend operations of the New Brittania mill beyond 10 years. The company estimates a gold-production cost of $450 per ounce, “positioning Lalor as one of the lowest-cost gold mines in Canada.”

Recent gold prices have been around the US$1,340 mark.

The news comes on the heels of the company last year announcing the closure of all operations in Flin Flon in 2021, which had been the northern city’s main economic engine since 1927. The closure represents a loss of 900 jobs.

Hudbay’s latest announcement was welcome news for an industry hit so hard, the Mining Association of Manitoba last year laid off its executive director.

“That’s great news for the mining industry in Manitoba,” said Chuck Davidson, president of the Manitoba Chambers of Commerce. “Hopefully, this will be the shot in the arm the industry needs in Manitoba. Hopefully, they can use this to address some of the workforce issues in Flin Flon.”

Hudbay has not specified additional hiring, but spokesman Scott Brubacher said the company is working on plans to transition workers from the shuttered Flin Flon operations.

“I can tell you our priority is to offer opportunities in Snow Lake to existing employees,” he said. “To support that, we will be looking to provide training, so that we have the right skills for the roles that need to be filled, and that people have the opportunity to learn them.”

Davidson said he’s encouraged by prospecting reports from northern Manitoba, suggesting there may be more good news to come.

Hudbay said the recent decision was supported by an investment of $14 million on airborne and ground geophysical surveys, and it expects a similar investment in 2019 will locate additional mineral deposits.

Snow Lake chief administrative officer Robert Hedley said a reaction from Mayor Peter Roberts is expected this morning.

“Nothing official, but you can certainly say we’re happy,” Hedley said.

Snow Lake’s population is 899, and the community is located 684 kilometres north of Winnipeg.

Lalor was discovered in 2007, and its main production shaft was completed in 2014.

kelly.taylor@freepress.mb.ca