HudBay delays Guatemala mine

Weak metals prices and global economic uncertainty has forced zinc and copper producer HudBay Minerals Inc. to delay construction of the Fenix nickel project in Guatemala.

Thursday, November 6, 2008


But its large cash position could make it a takeover target.
The company has long been the subject of M&A speculation, but its shares could trade higher with a buyout premium from names like Teck Cominco Ltd., Lundin Mining Corp. or Quadra Mining Ltd., according to Wellington West Capital Markets analyst Catherine Gignac.

HudBay's net cash position at the end of the third quarter was $844-million, or $5.48 per share. Analysts see the move as a way for it to preserve its balance sheet and have more time to develop a power strategy.

More on this topic

HudBay Minerals Searching for Partners

March 2011

The Canadian company seeks partner to develop their nickel mining project called "Fenix", located in Guatemala.

David Garofalo, HudBay´s CEO, told Mining Weekly that the search began in January and they are already looking at potential candidates.

Feasibility studies conducted by the former owner of the project estimate annual production of the mine at 85.000 tons of copper, 1.400 tons of molybdenum and 69 tons of silver.

Guatemala: HudBay Minerals takes over the Fenix project

August 2008

Skye Resources shareholders approved the merger and stock takeover by HudBay Minerals in exchange for a shareholding stake worth $396 million.

The merger will allow the HudBay Minerals mining company to take over the Fenix project located in El Estor, Isabal, Guatemala, which is considered to be the world’s fifth largest reserve of nickel.

No Start Date in Sight for Fenix Project

September 2009

No start date has been set for the reopening of the Fenix nickel project in Guatemala, owned by HudBay Minerals.

The project was acquired by HudBay last year when it purchased Canadian miner Skye Resources. It was then suspended as nickel prices plummeted, in the wake of the global economic crisis.

$50 million expansion for nickel mine in Guatemala

October 2008

The Fenix project, which mines nickel, closed a deal for $50 million with FLSmidth to improve their installations.

FLSmidth will provide the engineering to update existing equipment and will provide new industrial machinery.

The expansion should double the current production capacity.

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