Hudbay Minerals and Mitsubishi approved construction of the Copper World copper project in Arizona on October 21, 2026, targeting first production in the second half of 2029. The decision follows feasibility work outlining $2.07 billion in initial growth capital and average annual copper production of 102,000 metric tonnes over the first decade.
Key Takeaways
- Hudbay owns 70% of Copper World and Mitsubishi owns 30%; the partners have approved the final investment decision.
- Hudbay expects to contribute approximately $500 million, with its first capital contributions deferred until 2028.
- The base plan covers 15 years, while a proposed 37-year extension would require federal permits.
Table of Contents
- Copper World moves toward construction
- Funding plan defers Hudbay’s contributions until 2028
- Later expansion underpins higher production
- Longer mine life depends on federal permits
- Conclusion
Copper World moves toward construction
The project lies approximately 50 kilometres southeast of Tucson. Hudbay’s construction approval announcement sets out a development plan supported by a definitive feasibility study and related pre-feasibility studies. Hudbay said it will file a technical report under Canada’s National Instrument 43-101 disclosure requirements.
The new study raises projected average annual copper output over the first 10 years to 102,000 metric tonnes from 92,000 tonnes in the 2023 pre-feasibility study, an 11% increase. These are planned production levels, not operating results.
The base plan now concentrates a comparable quantity of mill feed into a 15-year mine life, versus 20 years in the 2023 study. A planned processing expansion helps explain the combination of higher annual output and a shorter base-case operating life.
| Item | Details |
|---|---|
| Proven and probable reserves | 390 million metric tonnes |
| Reserve copper grade | 0.47% |
| Base-case strip ratio | 1.5 |
| Projected cash cost, first 10 years | $1.65 per pound of copper |
| Projected sustaining cash cost, first 10 years | $2.22 per pound of copper |
Funding plan defers Hudbay’s contributions until 2028
All financial figures are in U.S. dollars. The $2.07 billion initial growth-capital estimate falls to $1.84 billion after a $230 million deposit from Wheaton Precious Metals under the existing precious-metals streaming agreement.
The funding plan also includes Mitsubishi’s $600 million initial joint-venture equity investment and approximately $650 million in anticipated project-level debt. The remaining funding would come from the partners’ proportional equity contributions beginning in 2028.
Hudbay estimates its own capital contributions at approximately $500 million, less than one-quarter of initial growth capital. The company expects to fund that amount using existing liquidity and projected cash flow from its operations; the project debt remains anticipated rather than completed financing.
Separately, Hudbay expects to close an increase in its revolving credit facilities to $700 million in the fourth quarter of 2026, with maturity extended from November 2028 to November 2030.
Later expansion underpins higher production
The mine plan starts with a concentrator processing 60,000 U.S. short tons per day and contemplates expansion to 90,000 short tons per day in operating year five. Average annual copper production is projected to rise from 84,000 metric tonnes in years one through five to 120,000 tonnes in years six through 10.
The initial capital estimate is not the full cost of all subsequent expansions. The study separately identifies $242 million for an in-pit crushing and conveying system in year three and $443 million for concentrator expansion in year four. The conveying system is planned to begin operating in year four.
At an assumed long-term copper price of $5.00 per pound, the base case estimates an after-tax net present value of approximately $1.2 billion using an 8% discount rate and an internal rate of return of approximately 17%. At $6.00 per pound, those estimates rise to approximately $2.3 billion and 22%. These modeled returns depend on the study’s assumptions, including copper prices.
Longer mine life depends on federal permits
Hudbay said all major permits have been obtained for construction and initial operations under the 60,000-short-ton-per-day scenario. The base case stays within Copper World’s private landholdings and requires state and local permits only.
The separate extension case would expand mining onto federal lands in operating year 10 and extend the mine life to 37 years. It requires federal permits and uses measured and indicated mineral resources, rather than being confined to the reserves supporting the base case.
Hudbay also continues to evaluate a concentrate leach facility that could produce copper cathode domestically. Although the facility is fully permitted, it remains a future option rather than a committed component of the current development plan.
Conclusion
The approval moves Copper World into development, but production remains targeted for the second half of 2029. Nearer-term milestones are the planned technical-report filing and expected fourth-quarter closing of Hudbay’s enlarged credit facilities.
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