July 3, 2012 / 11:01 AM / 5 years ago

UPDATE 1-Aquila says HudBay suspends work at Michigan project

July 3 (Reuters) - Aquila Resources Inc said joint venture partner HudBay Minerals Inc has decided to suspend development activities at the Back Forty zinc project in Michigan due to its capital commitments to other development projects.

Base metal miner HudBay, which traces its roots back more than 80 years to the Flin Flon mine in northern Manitoba, has been looking to expand its asset base in Peru.

Aquila owns 49 percent interest in the advanced stage exploration gold-zinc project, while HudBay holds the rest.

“The Back Forty project is in the final phases of permit preparation and remains a highly prospective development prospect,” said Aquila CEO Tom Quigley.

The estimated production rate at Back Forty is 3,150 tonnes per day and the mine is expected to have a life of 8 to 10 years, according to HudBay’s website.

HudBay is also terminating the strategic exploration alliance with Aquila.

Shares of Aquila closed at 24 Canadian cents on Friday on the Toronto Stock Exchange, HudBay shares closed at C$7.85.

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