Canada

Lalor

Primary Metals

Gold, Zinc, Copper

Daily Ore Mined

4,500 tonnes

Mine Type

Underground

777 mine

Primary Metals

Zinc, Copper

Daily Ore Mined

3,000 tonnes

Mine Type

Underground

Hudbay is on the cusp of an exciting new growth phase in Canada, the latest chapter in close to 100 years of history.

Our Canadian business can trace its history back almost a century, to our first mines in Manitoba’s Flin Flon Greenstone Belt. It was there we laid the foundation for the mine-building expertise and community engagement that distinguish Hudbay to this day. Our operational focus in Canada is shifting to Manitoba’s Snow Lake region as our reserves, processing capacity and exploration activities expand in the region, setting the stage for a new phase of growth. Our Lalor mine (gold, zinc, copper, silver) in Snow Lake is fast becoming a meaningful low-cost gold producer that will benefit substantially from the refurbishment of the New Britannia mill, expected to be complete in 2022. Our 777 mine (copper, zinc, gold, silver) in Flin Flon is approaching the end of its mine life after 15 stellar years. Final production is anticipated in 2022. Flin Flon helped shape Hudbay’s values of dignity and respect, caring, openness and trust, which reflects how we will manage the closure and support for the community.

Number of Employees

1456

Mine Life

Lalor

2028

777 mine

2022

The electricity used to run our processing plants is primarily renewable.

2018 Performance (Contained metal in concentrate produced)

Copper:

32,372 tonnes

Zinc:

115,588 tonnes

Precious Metals:

113,188 ounces

2019 Production Guidance (Contained metal in concentrate)

Copper:

22,000–25,000 tonnes

Zinc:

110,000–115,000 tonnes

Precious Metals:

105,000–125,000 ounces

Environment

We take environmental performance seriously, and are implementing the Mining Association of Canada’s TSM (Towards Sustainable Mining) protocols for Biodiversity, Energy and Greenhouse Gas and Tailings at all of our operations. These protocols provide clear guidelines for monitoring, measuring and reporting on performance. They emphasize management processes, senior executive oversight and expert third-party reviews, which help to ensure appropriate technical standards of construction, maintenance and operation.

AA Rating

Retained for tailings management in 2018 TSM Progress Report

Community

Hudbay didn’t just build a successful business in northern Manitoba – it helped build successful communities like the city of Flin Flon. Through jobs, business opportunities, taxes and royalties, community development programs and infrastructure investments, we support and advance long-term socio-economic development. In northern Manitoba, where a large portion of the population self-identify as indigenous, we work closely with our indigenous community partners to bridge cultural gaps and improve business opportunities. Developing job skills within indigenous communities not only helps the communities; it also benefits Hudbay by growing the base from which we hire and increasing the number of qualified suppliers from which we procure goods and services.

^$45.4 million

Payments to suppliers

^$1,126,857

Payments to indigenous businesses

People

We recognize that employing people with different backgrounds, experiences and perspectives makes us stronger and fosters collaboration. In Manitoba, we partnered with the Northern Manitoba Sector Council to increase recruitment of indigenous employees. Twelve people have been hired under the program so far. Separately, two women in our Manitoba Business Unit founded the Hudbay Women’s Network, an employee-led voluntary resource group. The group’s founding principle is gender inclusion and its goal is to empower Hudbay employees by providing a vehicle for professional growth and a strong voice. To learn more, please visit: Hudbay Women’s Network: Fostering Gender Diversity in Mining.

17%

Of our employees in Manitoba self-identify as indigenous

15%

Of our employees in Manitoba are female

Reserves and Resources – Lalor

Current mineral reserves and resources (exclusive of reserves) for Lalor as of January 1, 2019 are summarized below.

Lalor Mine Mineral Reserve and Resource Estimates¹	Tonnes	Cu Grade (%)	Zn Grade (%)	Au Grade (g/t)	Ag Grade (g/t)
Base Metal Zone Reserves
Proven	5,137,000	0.76	7.13	2.37	26.31
Probable	5,552,000	0.44	4.19	3.52	27.39
Gold Zone Reserves
Proven	58,000	0.80	2.65	5.46	39.09
Probable	2,928,000	1.09	0.31	6.74	23.08
Total proven and probable	13,675,000	0.70	4.46	3.78	26.11
Base Metal Zone Resources
Inferred	1,385,000	0.70	2.30	4.49	43.58
Gold Zone Resources
Inferred	4,516,000	1.08	0.35	4.38	20.42
Total inferred	5,901,000	0.99	0.81	4.41	25.85

Note: totals may not add up correctly due to rounding.
¹ Mineral reserves and resources calculated using metal prices of $1.17 per pound zinc (includes premium), $1,260 per ounce gold, $3.10 per pound copper, $18.00 per ounce of silver and using a C$/US$ exchange rate of 1.25.

Reserves and Resources – snow lake region

Current mineral resources for the Snow Lake regional deposits as of January 1, 2019 are summarized below.

Snow Lake Regional Deposits (Excluding Lalor) Mineral Resource Estimates^1,2,3	Category	Tonnes	Cu (%)	Zn (%)	Au (g/t)	Ag (g/t)
WIM	Indicated	3,900,000	1.71	0.26	1.57	6.68
	Inferred	700,000	1.03	0.37	1.76	4.65
Pen II	Indicated	500,000	0.49	8.89	0.35	6.81
	Inferred	100,000	0.37	9.81	0.30	6.85
New Britannia Zones	Inferred (Gold)	4,500,000	-	-	4.82	-

¹ WIM mineral resources reported based on a 1.3% CuEq cut-off for the underground portion, and a 0.5% cut-off for the open pit portion, assuming processing recoveries of 90% for copper and zinc for gold and silver, and using long-term prices of $3.00 per pound copper, $1,200 per ounce gold, $1.00 per ounce zinc and $15.00 per ounce of silver.
² Pen II mineral resources are estimated at a minimum NSR cut-off of C$65 per tonne and assumed that the Pen II mineral resources would be amenable to processing at the Stall mill.
³ New Britannia mineral resource estimates have been reported at a minimal true width of 1.5 metres and with a cut-off grade varying from 2 grams per tonne (at the 3 Zone and the lower part of New Britannia zone) to 3.3 grams per tonne (at Birch and for the upper part of New Britannia zone).

Reserves and Resources – 777 Mine

Current mineral reserves and resources (exclusive of reserves) for 777 as of January 1, 2019 are summarized below.

777 Mine Mineral Reserve and Resource Estimates¹	Tonnes	Cu Grade (%)	Zn Grade (%)	Au Grade (g/t)	Ag Grade (g/t)
Mineral Reserves
Proven	2,169,000	1.80	4.44	1.77	26.45
Probable	1,384,000	0.97	3.75	2.03	21.65
Total proven and probable	3,552,000	1.48	4.17	1.87	24.58
Mineral Resources
Indicated	375,000	1.13	4.05	1.79	29.57
Inferred	395,000	1.43	5.03	3.09	40.44

Note: totals may not add up correctly due to rounding.
¹ Mineral reserves and resources calculated using metal prices of $3.10 per pound copper, $1.24 per pound zinc (includes premium), $1,283 per ounce gold, $17.50 per ounce silver and using a C$/US$ exchange rate of 1.267.

Canada

Lalor

Primary Metals

Daily Ore Mined

Mine Type

777 mine

Primary Metals

Daily Ore Mined

Mine Type

Number of Employees

Mine Life

Lalor

777 mine

2018 Performance (Contained metal in concentrate produced)

Copper:

Zinc:

Precious Metals:

2019 Production Guidance (Contained metal in concentrate)

Copper:

Zinc:

Precious Metals:

Environment

Community

People

Reserves and Resources – Lalor

Current mineral reserves and resources (exclusive of reserves) for Lalor as of January 1, 2019 are summarized below.

Reserves and Resources – snow lake region

Current mineral resources for the Snow Lake regional deposits as of January 1, 2019 are summarized below.

Reserves and Resources – 777 Mine

Current mineral reserves and resources (exclusive of reserves) for 777 as of January 1, 2019 are summarized below.

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