AREQUIPA, Peru (Reuters) - Canadian mining company Hudbay Minerals Inc (HBM.TO) wants to invest in greenfield projects in Peru or Chile now that its Constancia mine is up and running, said the chief executive officer.
Commercial production at Constancia in the Peruvian region of Cusco kicked off in late April and has been about 10 percent to 15 percent above capacity, David Garofalo said. The mine was expected to produce about 82,000 tonnes per year for 22 years.
“Now that we’re generating cash flow as a business we want to start putting some of that capital back to work as seed capital in juniors,” Garofalo said.
Garofalo said so-called “junior” exploration companies struggling to find capital amid slumping metal prices regularly pitch their projects to Hudbay, a medium-sized miner that quadrupled its copper output in the last quarter.
“Right now we’re trying to separate the wheat from the chaff,” Garofalo said.
Hudbay recently moved its engineering team in Peru to Arizona to work on the design of its Rosemont project, a process that should take about eight to 10 months, Garofalo said.
Hudbay has been waiting for U.S. officials to issue an environmental permit for Rosemont.
“While the permitting is going on one track, on a parallel track we’re doing the engineering,” Garofalo said.
He said he hopes construction on Rosemont to start next year.
Reporting by Mitra Taj; Editing by Lisa Shumaker