The Northern Miner, 8/27/2008
HudBay Minerals files resource on Lalor Lake
Lalor Lake has the potential to become HudBay Minerals' (HBM-T) next mine in the Flin Flon greenstone belt of Manitoba, the company said in a statement announcing the first resource estimate on the exploration project.
Its 100%-owned Lalor Lake deposit is near Snow Lake about 3 km from the company's Chisel North mine and 15 km from its Snow Lake concentrator.
Lalor Lake has a National Instrument 43-101 indicated resource of 3.4 million tonnes grading 1.9 grams gold per tonne, 20.5 grams silver per tonne, 0.71% copper and 8.82% zinc.
In the inferred category, the deposit holds 13.2 million tonnes grading 2.9 grams gold per tonne, 34.1 grams silver per tonne, 0.70% copper and 8.19% zinc.
The estimate includes information from 40 drill holes and 5 wedge offsets. HudBay continues to drill at Lalor with six rigs to upgrade the inferred resource and collect samples for metallurgical testing purposes.
Copper and zinc mineralized intersections were geologically interpreted into six stacked lenses, or zones, of zinc-rich polymetallic near solid to solid sulphide mineralization at about 570 metres to 1,170 metres below the ground.
The reported resource estimates of gold and silver are contained within the interpreted zones of copper and zinc mineralization. High-grade precious metal intersections also occur outside the mineralized zones and HudBay is currently working with Scott Wilson Roscoe Postle Associates to evaluate their continuity.
The resource estimate was based on a zinc equivalency (ZNEQ) cut-off of 4%. The ZNEQ was based on long-term metal prices of US$700 per oz. gold, US$12 per oz. silver, US$2 per lb copper and 85¢ per lb. zinc. Metal recovery assumptions used were 65% gold, 60% silver, 90% copper and 90% zinc.
HudBay is building an all-weather access road to the site that will likely be finished by the middle of September. A feasibility study is also planned to get underway during the fourth quarter.
The mining company holds 400,000 hectares of exploration territory in the Flin Flon greenstone belt and operates mines, concentrators and metal production facilities in northern Manitoba and Saskatchewan, a zinc oxide production facility in Ontario, and the White Pine copper refinery in Michigan.
HudBay trades at about $10.72 per share and has a 52-week trading range of $9.12-$27.74. With 126.5 million shares outstanding, its market capitalization runs at about $1.36 billion.
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