Canadian miner Hudbay Minerals (TSE: HBM) has plans to double the annual gold output from the Lalor gold-copper-zinc mine 13 km west of Snow Lake, Manitoba. As part of the plan the New Britannia mill will be refurbished at a cost of $95 million raising Lalor gold output to 140,000 oz. per year.
The Lalor mine will then be joining the ranks of primary gold producers as one of the lowest sustaining costs in the industry - $450 per oz. - net of by-products.
There is an inferred resource of 5.9 million tonnes at 4.41 g/t gold, 0.99% copper, 0.81% zinc and 25.85 g/t silverHudbay acquired the New Britannia mill in 2015. A new copper flotation circuit will be installed as part of the refurbishment.
The New Britannia mill will treat gold-rich ore with a gold recovery of 93%, compared to only 53% in the Stall mill. The Stall mill will continue to treat zinc-rich ore, but throughput is expected to fall to 1,800 t/d by 2022.
A new 4,500-t/d mine plan covers Lalor gold and copper-gold ores as well as material in satellite deposits, extending the mine life to 10 years. Proven and probable reserves now stand at 13.7 million tonnes grading 3.78 g/t gold, 1.09% copper, 4.46% zinc and 26.11 g/t silver. In situ gold has increased by 65%, copper by 23%, zinc by 11% and silver by 15% using the latest estimate.
There is also an inferred resource of 5.9 million tonnes at 4.41 g/t gold, 0.99% copper, 0.81% zinc and 25.85 g/t silver.
At market close Wednesday, Hudbay's shares were up 3.5%.
This story first appeared in Canadian Mining Journal.