Hudbay Minerals says it is investing $122 million in some Rosemont Mine-related projects such as building water and power lines this year, and hopes to start construction on the open pit mine itself by the end of 2019.
It has also started taking applications for the first 15 jobs it will create at the mine site in the Santa Rita Mountains southeast of Tucson.
While some of the jobs are related to the mine’s $1.92 billion construction project, others are directly tied to the operation of the copper mine itself. The job openings have been posted on Hudbay’s website and will be listed in a classified ad set for publication in Sunday’s Arizona Daily Star.
The jobs include a construction and site manager, a human resources manager, an information technology manager, an electrical engineer, a health and safety manager, a mill manager, a senior accountant and a procurement and supply manager.
Ultimately, the mine is supposed to have about 3,000 construction jobs and about 500 full-time jobs when in operation.
The water and power line are among several “early works” projects that Hudbay intends to carry out before beginning formal construction.
Hudbay plans to seek approval from its board of directors to start construction at the end of this year, the company said in a news release this week. “This would enable first production by the end of 2022,” it said.
Its news release didn’t say exactly when the “early works” projects such as the power line will start. But it appeared from the release that those projects will start before the end of 2019.
Specifically, these projects are:
- A water line to take pumped groundwater from Rosemont’s wells in the Sahuarita area over the Santa Rita Mountains to the mine site, where the water will be used in mine operations.
- A power line to take electricity from a Tucson Electric Power facility near Sahuarita over the mountains to the mine site.
- Doing engineering and geotechnical work to help with long-term procurement, design and delivery of construction equipment, capital projects and making sure that the mine’s design and construction work progress smoothly and on schedule.
- Archaeological site work to prepare key areas for construction.
- Spending on unspecified, permit-related mitigation activities, including possibly finalizing land purchases and owner’s costs including labor, insurance, equipment and other items needed to make the project feasible.
The $122 million will come from $515 million in cash Hudbay says it had on hand as of December 2018, the company said in the news release.
Hudbay intends to soon seek a new joint venture partner that would have a minority stake in operating what would be the third-largest U.S. copper mine, the release said.
Hudbay says it intends to ultimately have a 70 percent share of the Rosemont project. The company has already agreed to buy out one minority partner, Korean-based United Copper & Moly LLC, for $75 million. That company had a 7.95 percent interest in Rosemont, which also has other minority partners.
The company said the acquisition gives Hudbay strategic flexibility with respect to its capital structure and project financing alternatives.
“We are pleased to be moving forward at Rosemont and look forward to carrying out the early works in parallel with financing activities for the project,” said Alan Hair, Hudbay’s president and chief executive officer, in the news release.
“It’s absolutely good news,” said Rick Grinnell, vice president of the pro-mining Southern Arizona Business Coalition, calling the $122 million spending plan “a nice jumping-off point” for the project’s full construction budget.
“Most of it will stay in the local economy,” Grinnell said, while noting that some of the equipment and labor will come from out of town.
“You’re talking about a lot of jobs” and capital investment that will attract more companies to locate here, he said.
The announcement of the projects comes about three weeks after the mining company got its final government permit for the mine, a Clean Water Act permit from the U.S. Army Corps of Engineers issued March 8.
On March 20, the U.S. Forest Service signed off on Rosemont’s final mining plan of operations.
Still pending are four lawsuits from environmentalists and Indian tribes challenging various project approvals from three federal agencies, including the Corps.
The opponents, who filed their latest suit Wednesday, have said they will go to court to seek a restraining order or an injunction to block construction once they get a formal, 30- day notice from Hudbay that construction will start.
Depending on the nature of the company’s Rosemont archaeological work, that could be one of the first activities that triggers court action seeking an injunction.
Three tribes have expressed major concerns about that work’s impacts on historical resources and on human burials they say likely lie under the mine site, despite various commitments by the company and federal agencies to mitigate the impacts.
Hudbay said in its news release that it is confident the federal permits and other approvals will all be upheld.
