Copper World (Base Case) Feasibility Study: $1.24B NPV, 16.8% IRR
Hudbay Minerals Inc.'s Copper World (Base Case) in United States, Arizona (approx. 50 km southeast of Tucson) has a Feasibility Study outlining an after-tax NPV of $1.24B, an after-tax IRR of 16.8%, and initial capital of $2.07B. The mine plan runs 15 years at about 102000 t Cu (first 10 years); 84kt yrs 1-5, 120kt yrs 6-10, 95kt LOM avg per year.
Hudbay Minerals Inc.'s Copper World (Base Case) has reported Feasibility Study results for the copper project in United States, Arizona (approx. 50 km southeast of Tucson). The study headlines an after-tax net present value of $1.24B at a 8% discount rate. It reflects Hudbay Minerals Inc.'s (HBM) latest disclosed economics for the asset.
Economics. The after-tax NPV is $1.24B using a 8% discount rate. After-tax IRR is 16.8%. Initial capital expenditure is estimated at $2.07B. The study models a payback period of 5.4 years. All-in sustaining costs are pegged at 2.22 USD/lb Cu (sustaining cash cost); cash cost $1.65/lb. Economics are based on Long-term copper $5.00/lb ($5.50/lb in year 1 and $5.13/lb in year 2); molybdenum $17.50/lb; gold stream price $540/oz (15% of market); silver stream price $6.75/oz (15% of market). Resource estimate used $5.00/lb Cu, $20.00/lb Mo, $3,600/oz Au, $50.00/oz Ag..
Production and mine plan. The project envisions an open-pit operation. Life of mine is 15 years. Average annual production is approximately 102000 t Cu (first 10 years); 84kt yrs 1-5, 120kt yrs 6-10, 95kt LOM avg. Average head grade is 0.47% Cu (reserves); 103 g/t Mo, 0.023 g/t Au, 5.08 g/t Ag. The open-pit strip ratio is 1.5.
Resources and ownership. The company holds a 70% interest in the project. Royalties and streams: Wheaton precious metals stream: $230M deposit for 92.5% of gold and silver contained in production, plus $70M additional deposit five years after commercial production subject to 90,000 tpd expansion; ongoing payments 15% of spot. 30% JV partner Mitsubishi..
These figures are extracted from Hudbay Minerals Inc.'s technical disclosures and reflect the most recent Feasibility Study on file. Compare this project against other developers and producers in our project economics database, and always verify the numbers against the original technical report before making any investment decision.
Reserves & Resources
| Category | Tonnage | Grade | Contained |
|---|---|---|---|
| Proven | 330 Mt | 0.47% Cu, 105 g/t Mo, 0.024 g/t Au, 5.25 g/t Ag | — |
| Probable | 60 Mt | 0.46% Cu, 94 g/t Mo, 0.018 g/t Au, 4.14 g/t Ag | — |
| Total Proven and Probable | 390 Mt | 0.47% Cu, 103 g/t Mo, 0.023 g/t Au, 5.08 g/t Ag | — |
| Category | Tonnage | Grade | Contained |
|---|---|---|---|
| Measured | 890 Mt | 0.42% Cu, 124 g/t Mo, 0.022 g/t Au, 4.43 g/t Ag | — |
| Indicated | 347 Mt | 0.35% Cu, 109 g/t Mo, 0.015 g/t Au, 3.32 g/t Ag | — |
| Total Measured and Indicated | 1,236 Mt | 0.40% Cu, 120 g/t Mo, 0.020 g/t Au, 4.12 g/t Ag | 4,993 kt Cu (2026 DFS) |
| Inferred | 309 Mt | 0.30% Cu, 103 g/t Mo, 0.012 g/t Au, 2.69 g/t Ag | 927 kt Cu |
Our Analysis
- IRR after-tax
- 16.8%
higher than 26% of 38 projects we track
- NPV after-tax
- $1.24B
higher than 62% of 45 projects we track
- Initial capex
- $2.07B
167% of NPV
costlier than 66% of 47 projects we track
- Payback
- 5.4yrs
slower than 89% of 36 projects we track
- Mine life
- 15yrs
- Discount rate
- 8%
- Study price assumption
- Long-term copper $5.00/lb ($5.50/lb in year 1 and $5.13/lb in year 2); molybdenum $17.50/lb; gold stream price $540/oz (15% of market); silver stream price $6.75/oz (15% of market). Resource estimate used $5.00/lb Cu, $20.00/lb Mo, $3,600/oz Au, $50.00/oz Ag.
- Spot copper today
- $6.58/lb
Against the 38 copper projects we track, this one lands in the lower half on returns and near the bottom on payback: an after-tax IRR of 16.8% and 5.4 years to recover capital, a payback faster than only 11% of the 36 projects with that data. For an investor, that combination means the project clears the practical ~15% after-tax threshold developers need to attract project finance, but with little headroom, and it asks for its money back later than almost everything else in the set. The NPV of $1.24B ranks higher than 62% of 45 peers, so the asset has size; the problem is the shape of the cash flow, not its scale.
The binding constraint is the build. Initial capex of $2.07B is 167% of NPV, and at roughly 0.2x the company's US$10.51B market cap it is small relative to the whole. That is the sharpest funding signal here, and it cuts both ways: the company can plausibly carry the cheque without a transformational raise, but it is one of 11 projects in the portfolio, so this asset competes for capital rather than commanding it. The feasibility study, with its tighter estimate band, gives these numbers more weight than a scoping exercise would, and the Arizona jurisdiction is a genuine positive on permitting and operating risk.
The price deck is where the returns get their help. The study assumes $5.00/lb copper long-term against a live spot of $6.58/lb, so there is real upside if spot holds, but the 16.8% IRR is built on that lower number and the long payback leaves little cushion if copper falls short of it. The question that decides this project: can it be financed and built on schedule at $2.07B, because a 5.4-year payback and a mid-table IRR leave no room for a capex overrun.
Our take, benchmarked against the project economics in the Mining Stocks database. Figures are estimates drawn from company technical reports — not investment advice; always verify against the source filing.
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