Hudbay has responded to a statement made by several local union chapters regarding the company’s plans for Flin Flon and northern Manitoba.
When asked by The Reminder, Hudbay issued comments on the statement, sharing their stance on 1901 and union relations.
“With the current metal prices, we simply do not have enough cash to fund all of the growth and sustaining capital projects in the Manitoba Business Unit. Accelerating development towards the 1901 deposit to keep the zinc plant open would require investments in a new zinc plant tailings facility and upgrades at Stall Mill to increase the throughput,” read a statement from a Hudbay spokesperson.
“At this time, with the current knowledge of the orebody, these investments cannot be justified. We will continue with the winter infill drill program to upgrade the confidence of the resource to further assess the project.”
The spokesperson said some work is continuing at 1901, namely a winter drilling program that will wrap up next month and a further exploration program at the site.
“The winter diamond drill program will be wrapping up in April and we will spend approximately $5 million in 2020 on this exploration program. Our priority for 1901 is to drill the gold mineralization while upgrading the zinc inferred resource estimate to a higher category,” said the Hudbay statement.
“Once all of the core has been logged and assayed, the geological team will update the block models and the engineering team will then update the mine plan to evaluate the economics of the project and determine next steps. We expect to have this updated information complete for the annual reserve and resource statement update in March 2021.”
As far as Flin Flon’s zinc plant goes, despite possible discussion of fast-tracking 1901 to feed the mill and plant, the company’s plans remain to shut down the works along with 777 in two years.
“In the most recent business update issued in January 2020, we announced that the Zinc plant would close with the 777 mine in April 2022,” read the statement from Hudbay.
In response to the union group’s stance on investment in Peru, the spokesperson said Hudbay had been “transparent of the fact that the 777 mine would be closing and this would have a direct impact on the Flin Flon mill and zinc plant. Without a new source of feed, the zinc plant would close as well.”
“The discovery of 1901 in 2019 provided some hope that the Zinc plant life could be extended, but at this time, with the current knowledge of the ore body and the current commodity price environment, these investments cannot be justified.”
The spokesperson added, “the biggest growth investment Hudbay is making in the next couple years is in Manitoba - the approximately $150 million investment in refurbishing the New Britannia mill and upgrading the Snow Lake infrastructure to increase our production from the Lalor mine. This investment will ensure the Snow Lake operations remain a reliable long-term employer for many years.“
When asked about the union group’s complaints regarding high-ranking Hudbay staff being flown in and out of Flin Flon, the spokesperson said the company has attempted to cut down on flying by senior staff, adding their own priorities for hiring on projects near Snow Lake.
“There are some senior personnel in the management team that also commute, though we have recently reduced the number of people that fly in and fly out,” said the spokesperson.
“Hudbay's first priority is to hire within our local communities. In Flin Flon, nearly our entire workforce lives in the community. However, when it comes to Snow Lake, we have exhausted the pool of skilled personnel, and as a result, half of the workforce commutes and stays at the camp. Once we complete the transition of our workforce from Flin Flon to our Snow Lake operations, we expect our personnel that live in Northern Manitoba to take over this work.”
The spokesperson confirmed that Hudbay received a request from Flin Flon-based unions to meet with executives and board members. While not confirming a meeting will be held between the group and CEO Kukielski or Hudbay board members, the spokesperson said Assabgui is willing to meet with the group.
“Hudbay has responded to the email in question and the board and management team are aware of the union’s thoughts as it relates to 1901. Robert Assabgui… has met with the union leaders on several occasions, and is willing to meet with them again.”
