Hudbay Minerals and Japan’s Mitsubishi have approved construction of the Copper World project in southern Arizona, committing to a development with an estimated capital cost of $2.1 billion (C$2.9 billion). Canadian Mining Journal reported that the decision comes despite a 59% increase in construction costs compared with the earlier estimate. The approval follows completion of a definitive feasibility study.
The project’s capital requirement was put at $1.3 billion in a 2023 prefeasibility study. In a statement issued on Wednesday, Hudbay said changes to the project’s scope since that study had added $200 million to capital costs. That figure represents the contribution from scope changes, rather than the full increase between the earlier estimate and the newly approved investment level.
Hudbay expects its own contribution to total about $500 million, equivalent to less than a quarter of the initial investment, according to the report. Its first instalment is not due until 2028. The company’s expected funding contribution is therefore substantially below the overall project cost, although the report did not provide a complete breakdown of how the remaining investment would be funded.
Copper World lies approximately 50 km southeast of Tucson and is scheduled to begin production in the second half of 2029. Canadian Mining Journal described it as one of the largest new copper mines planned in the United States. Together with growth initiatives at Hudbay’s existing operations, the project is expected to help double the company’s consolidated annual copper output to around 250,000 tonnes; that target is not Copper World’s standalone production forecast.
RBC Capital Markets mining analyst Sam Crittenden characterised the approval as progress towards Hudbay’s medium-term growth plans in a Wednesday note, while suggesting the share-price response could be limited because the scope and initial capital estimate were broadly anticipated. Hudbay shares gained 0.2% to C$33.34 in Toronto on Wednesday morning, giving the company a market value of approximately C$14.8 billion ($10.6 billion).