Hudbay Minerals has reclassified the amount of copper at its proposed Rosemont mine made by former owner Augusta Resource Corporation as “historical estimates” rather than as current mineral reserves.
“A qualified person has not done sufficient work for us to classify Rosemont’s mineral reserves or resources as current mineral reserves or resources,” the Toronto-based company stated in its Annual Information Form for 2014 released on March 30.
The lack of a “qualified person” raises questions over Augusta’s previous feasibility studies that provided resource estimates for the proposed open pit copper mine in the Santa Rita Mountains on the Coronado National Forest southeast of Tucson.
Augusta’s feasibility studies released in 2007, 2009 and 2012 were required to meet Canadian regulatory standards by having a “qualified person” make resource estimates.
The reclassification also raises questions with the size and exact location of the copper resource that Hudbay wants to mine and raises the possibility that Hudbay intends to greatly expand its mining footprint in the Santa Ritas.
Hudbay’s growth policy focuses on developing “mineral assets that we believe offer significant potential for exploration, development and optimization.” (Emphasis added.)
Scrapping Augusta’s copper resource estimates also raises questions about the accuracy of the Coronado National Forest’s Final Environmental Impact Statement for the Rosemont copper project released in December 2013.
The FEIS was based on Augusta’s Mine Plan of Operations submitted in 2007 and as modified by subsequent feasibility studies including the 2012 report.
Soon after acquiring Augusta last summer, Hudbay began a 43-hole “confirmatory drill program” at the site for the proposed mile-wide, half-mile deep open pit copper mine that is projected to produce 240 million pounds of copper a year for 21 years.
Hudbay completed the drilling in December and is continuing metallurgical testing of the core samples.
While, Hudbay states it doesn’t anticipate significant changes to copper resource estimates included in Augusta’s feasibility study, the company also warns that unexpected findings from its ongoing analysis may occur.
“We are currently reviewing the cost, production and other assumptions underlying the previous feasibility study for the Rosemont project and are advancing the basic engineering,” the AIF states.
“Once our review is complete and the engineering is sufficiently advanced, we expect to complete a feasibility study, including an estimation of the mineral resources and reserves at Rosemont.
“Any changes that we make to assumptions, or any such assumptions otherwise proving incorrect, could negatively impact project economics for Rosemont.”
THE TRUTH HAS FINALLY SURFACED . IT APPEARS THAT AUGUSTA CREATED A FALSE PICTURE OF THE ROSEMONT COPPER PROSPECT IN ORDER TO ” FLIP ” THE PROSPECT FOR THEIR MAXIMUM BENEFIT . THEY DID SO VERY SUCCESSFULLY WITH THE FULL SUPPORT OF THE FOREST SERVICE WHO ACCEPTED AUGUSTA’S ” SPIN ” AND PROCEEDED WITH THE PERMITTING AS IF ALL WAS WELL AND ” ABOVE BOARD “. IF THE SUPPOSED ” RESERVES ” QUOTED FOR THE ROSEMONT COPPER PROSPECT ARE INACCURATE , IN ANY WAY AS REPORTED , THEN THE ” QUALIFIED PERSONS ” INVOLVED ARE IN VIOLATION OF THEIR PROFESSIONAL STANDING .
HUDBAY APPEARS TO HAVE BEEN AWARE OF THIS MATTER AS THEY INITIATED A MAJOR DRILLING PROGRAMME SHORTLY AFTER ACQUIRING THE PROPERTY FROM AUGUSTA IN ORDER TO BETTER DEFINE THE RESERVES FOR THEIR ONGOING EVALUATION .
THROUGHOUT THE AUGUSTA SAGA , SERIOUS CONCERN WAS EXPRESSED OVER THE APPARENT INADEQUATE MINE PLAN PROVIDED BY AUGUSTA TO THE FOREST SERVICE AS PART OF THE PERMITTING PROCESS .
THIS MATTER RAISES SERIOUS QUESTION OVER THE FOREST SERVICE’S ABILITY TO CARRY OUT FACTUAL AND FULLY TRANSPARENT PERMITTING OF THE ROSEMONT COPPER PROSPECT .
THE OFFICERS OF AUGUSTA CERTAINLY PULLED THE WOOL OVER THE EYES OF THE FOREST SERVICE . THE OFFICERS OF AUGUST DID WHAT THEY DO BEST AND THAT IS TO MAKE MONEY AT THE EXPENSE OF OTHERS . NOW THEY HAVE HITCHED THEIR HORSES TO A WAGON IN PATAGONIA .
IT APPEARS THAT HUDBAY WILL SUBMIT NEW RESERVE FIGURES AND THEIR OWN ” MINE PLAN ” WITH MAJOR REVISIONS TO THE APPLICATION ORIGINALLY SUBMITTED TO THE FOREST SERVICE . CAN THE FOREST SERVICE DEAL WITH MATTER UNDER THE CIRCUMSTANCES ? MAYBE IT IS TIME FOR THEM TO SAY ” NO ” TO THE PROPOSAL AND ADVISE THE ARMY CORP OF ENGINEERS ACCORDINGLY .
Alan, You are correct. People kept saying that’s that they never planned to mine–and I dug up the proof. At the present time, Augusta Resource Corp. is stating that Rosemont in Arizona is its sole property, even though press releases in 2000, 2002, 2004 and 2006 stated they had obtained properties in Guadalupe, Mexico, Nunavut, Canada, White Pine County, Nevada and New Mexico. We have to know what is happening on these properties to get a picture of what could happen here or even if the press releases were based on facts. (See more: http://www.savethesantacruzaquifer.info/Augusta.htm
Another sure sign of their duplicity was the properties they bought in old Sahuarita for their water supply wells. They purchased the property under assumed names–Kanarco Company, Sanrita Properties, Dawson Properties Kanarco Company, Sanrita Properties, Dawson Properties –so the owners wouldn’t know they were selling to a mining company. (One of the Colorado addresses was inaccurate.) http://www.savethesantacruzaquifer.info/Augusta-Well-Properties.htm
Okay, one other big one. Rosemont was always claiming they would not be mining on the west side of the mountain. Yet, in their Plan of Operations and reports to investors, they were stating that they had properties to expand to the west. “Mineralization also is known to occur in the Broadtop Butte, Copper World and Peach-Elgin deposits on the Rosemont Property, which could potentially add to the total mineral resource base of the Rosemont area…. http://www.savethesantacruzaquifer.info/Map%20of%20Patented%20Claims.htm
I kept insisting that the Forest Service include the total operation in the EIS–good luck with that logic. After all, Rosemont was writing the EIS, and paying Forest Service hours for any time they spent on the Rosemont project.