Hudbay Minerals Expands Flin Flon Exploration Partnership with Japanese Entities
TORONTO – Hudbay Minerals Inc. has announced the signing of an amended and restated option agreement with the Japan Organization for Metals and Energy Security (JOGMEC) and Marubeni Corporation. This agreement expands the existing exploration partnership focused on the Flin Flon region of Manitoba, marking a significant development in Canadian mineral exploration.
Details of the Option Agreement
The agreement grants JOGMEC an option to acquire a 10% interest in three mineral projects located within trucking distance of Hudbay's processing facilities in Flin Flon, Manitoba. To exercise this option, JOGMEC must fund at least C$6 million in exploration expenditures over approximately three years. Hudbay will serve as the operator conducting all exploration activities during this period.
This new arrangement amends and restates the original option agreement Hudbay entered into with Marubeni in March 2024. Under that previous agreement, Marubeni's wholly-owned Canadian subsidiary was granted an option to acquire a 20% interest in the same three projects, contingent upon funding at least C$12 million in exploration expenditures during the designated earn-in period.
Potential Joint Venture Structure
If both Marubeni and JOGMEC successfully complete their respective earn-in obligations and elect to exercise their options, a three-party joint venture will be established. The ownership structure would be as follows:
- Hudbay Minerals: 70% interest (acting as operator)
- Marubeni Corporation: 20% interest
- JOGMEC: 10% interest
Following joint venture formation, all subsequent exploration and development costs would be funded by each member in proportion to their participating interest. Should any projects advance to production, the parties may discuss utilizing Hudbay's idle Flin Flon milling complex for ore processing.
Strategic Significance for Flin Flon Region
"This expanded exploration partnership for the Flin Flon region, which now welcomes JOGMEC alongside our valued partners at Marubeni, represents a significant milestone towards unlocking potential future value in the Flin Flon region," stated Peter Kukielski, Hudbay's President and Chief Executive Officer.
Kukielski emphasized that this arrangement allows Hudbay to partner with both Marubeni and JOGMEC while leveraging the company's operational and exploration expertise. The partnership aims to test Hudbay's extensive Flin Flon land package for potential new discoveries that could utilize the company's idle processing infrastructure in the region.
"Hudbay has discovered and operated 29 mines in our nearly 100-year history in Manitoba, and we have the potential to continue that success with our continued focus on exploration," added Kukielski.
Project Highlights and Exploration Commitment
The agreement focuses on three highly prospective projects in the Flin Flon region. During the earn-in period:
- JOGMEC will fund at least C$6 million in exploration expenditures across the three projects
- Marubeni will complete the remainder of its C$12 million funding commitment
- Hudbay will manage all work programs as the operator
Upon successful completion of both parties' earn-in obligations, they may exercise their options to form a joint venture with Hudbay for any of the designated projects. This expanded partnership represents a substantial investment in Manitoba's mineral exploration sector and demonstrates continued international interest in Canada's mining potential.
