ROSEMONT: LOM MINE PLAN RP16JUN

| June 28, 2016

HBM

General Layout IMC - DFS

Plant

PIT

DSTF

SR 83

Ore stock
WRF

INVESTOR PRESENTATION | 2

General Layout HB - RP16JUN

Plant

PIT

DSTF

SR 83

Ore stock
WRF

INVESTOR PRESENTATION | 3

Mineral Resources
Model

2015
(*)

2016 V1
(**)

2016 V2
(**)

2016 V3
(**)

M+I
(M Tons)

1,018

1,279

1,319

1,294

Tcu%

0.39

0.35

0.35

0.35

SCu%

0.33

0.29

0.29

0.30

Cu Cont.

336

371

383

388

Inferred

129

167

121

84

1,147

1,446

1,440

1,378

Total

2015

2016

Notes

NSR Cutoff for report

o Oxide: 4.0 $
o Sulphur: 5.7 $
Main changes between models
(*) 302 DHs
(**) 356 DHs
Model V3 is being used for detail
mine plan RP16JUN.

(*) Pitshell IMC new pit1.1.msr

(**) Pitshell Hudbay pit3

INVESTOR PRESENTATION | 4

Mineral Reserves
Hudbay
RP16JUN

IMC DFS
82,90 105,149

Pre Stripping, Mt

105

105

Annual Movement, Mt

132

149

82 (1yr 5 yr)
90 (6 yr EOM)

82 (1yr 5 yr)
90 (6 yr EOM)

592

501

T Cu%

0.45

0.49

S Cu%

0.40

0.44

Waste, M tons

1,248

1,369

Stripping Ratio (SR)

2.1

2.7

Total Mined, M ton

1,840

1,870

76

48

1,916

1,918

20

17.5

2,080

1,929

Total: 641
Avg.: 128

Total: 674
Avg.: 135

Total: 1,440
Avg.: 103

Total: 1,256
Avg.: 114

Throughput, Ktpd
Mill Ore, M ton

Rehandle, M ton
Total Movement, M ton
Life of Mine*
Fine Copper, K Ton
Fine Copper 1 5Yr, K ton
Fine Copper 6 EOM, K ton

Notes

*Life of Mine considers 1 yr of pre-strip period in RP16JUN mine plan in comparison with 1.5 yrs of IMC DFS.

Fine copper no affected by payable factors.

Recoveries for fines calculation are: 88% for Sulphur and mixed ores, and 81% for oxide ore.
INVESTOR PRESENTATION | 5

Plan Optimized Until June 24, 2016

RESOURCES

New model 2016 V3 (June 08):

o

Updated geological interpretation (litho and mineralization)

Updated geostatistical parameter of estimation

More tonnage but lower grade

RESERVES
o

New model, more ore but less tonnage

Pit optimization with more revenue

Phases optimization (economical, technical operational): 6 phases, previous was 8 phases

Pit Schedule optimization:

o

MSSO to mine better values in the earlier periods, two haul roads, equipment utilization. Experience from Constancia using in the
KPIs parameters.

132 Mton based on an NPV optimization.

Stripping ratio optimization

Geotechnical and Hydrogeological optimization using information from C&N, Neirbo, Dave Lewis and HB. Further geotechnical analysis:
o

To updated database from holes, mapping, laboratory

Geotechnical model for RQD, hardness

Geotechnical sectors with lithology, geological faults, strength properties. IRA, Overall, pit design and pit mined worked together.

Slope stability sections and analyses

Hydrogeological analyses based on the hydrogeological review.

Mine CAPEX
o

Mine Fleet Equipment with one less shovel.

INVESTOR PRESENTATION | 6

Path forward Before July 18, 2016

CAPEX

Pre-Stripping stage developed in 01 year. Direct & indirect cost savings.

Mine Equipment Purchasing (max asset utilization), cost savings around

~35 M $.

OPEX

DFS

RP16JUN

MINE OPERATIONS, M $

387.0

352

G&A

19.9

19.9

Operational Readiness

4.0

4.0

Mine Fleet Procurement

236.5

201.5

To reduce total OPEX cost (US$) per year (less material movement).

Pre-stripping

105.9

105.9

To reduce mine trucks, then OPEX reduction.

20.6

20.6

To optimize fleet equipment utilization (considering one less shovel)

Misc Items, Services &

Light Vehicles

To review and optimize Drilling and Blasting

Fleet Management System to increase final asset utilization.

OPEX optimization from 1.23 $/t to 1.18 $/t (inc mine G&A). 5%
reduction in total Opex

DFS

RP16JU
N

Mining Infrastructure

5.7

5.7

Process Plant
Dry Tailings Stacking
System
Subtotal Direct Costs

122.2

122.2

19.8

19.8

147.7

147.7

Indirect Cost

32.5

32.5

Owners costs

195.4

177.4

375.6

357.6

Description
Direct Cost

SUSEX
o

Mine Fleet Equipment (Trucks): DFS maximum 43 in year 6 to RP16Jun

maximum 38 units in year. (~18 M$)

Dry Stacking Tailings Facility (DSTF) design and stacking plan review and

optimization (less total waste tonnage placed and in deferring periods).

o

WRF design and loading plan (to optimize distance and according to
DSTF plan and design).

Contingency

TOTAL COST

INVESTOR PRESENTATION | 7

Path forward Before July 18, 2016

IMC DFS
Category

Type

Drilling

Loading
Haulage

Support Equipment

Model

RP16JUN

Unit Price

Units

Blast-hole Drills

Atlas Copco PV271

$ 2,797,000

8,391,000

5,594,000

Blast-hole Drill, 7 7/8 - 9 7/8

Atlas Copco DML

$ 1,400,000

1,400,000

1,400,000

Electric Rope Shovel

Caterpillar 7495HD

$22,856,173

$ 68,568,520

$ 45,712,347

Hydraulic Shovel

Caterpillar 6060 FS

$10,500,000

$ 10,500,000

$ 10,500,000

Front End Loader

Caterpillar 994H

$ 5,726,500

5,726,500

Off Highway Mining Truck

Caterpillar 793F

$ 3,976,500

27

$107,365,500

25

Track Dozer

Caterpillar D10T2

$ 1,489,127

Front End Loader, 8 Yd.

Caterpillar 988H

918,516

Rubber Tired Dozer (RTD)

Caterpillar 834K

$ 1,211,555

Motor Grader

Caterpillar 16M

628,210

Water Truck 20000 Gallon

Caterpillar 777

$ 1,893,202

Hydraulic Excavator

Caterpillar 352FL w/Hammer CL

699,977

Loader Backhoe

Caterpillar 2 CY

All Terrain Crane

Lube Truck
Truck Mounted Lube Truck

Sub total

Units

Sub total

5,726,500

$ 99,412,500

7,445,635

918,516

918,516

3,634,665

3,634,665

1,884,630

1,884,630

7,572,808

7,572,808

699,977

699,977

180,500

180,500

180,500

TBD 75 Ton

$ 1,000,000

1,000,000

1,000,000

Caterpillar 773G

$ 1,365,058

2,730,116

2,730,116

TBD

213,400

213,400

213,400

Mechanic Field Service Truck Ford F550

282,075

1,692,450

1,692,450

Boom Truck

15 Ton

230,200

460,400

460,400

Forklift, Truck Shop

GRADE ALL 20,000 lbs

457,628

457,628

457,628

Integrated Tool Carrier

Komatsu 140HP/WA250

210,057

210,057

210,057

Solar Light Plant

Atlas Copco TBD

20,450

15

306,750

15

306,750

Cable Reeler

Caterpillar 980

840,900

840,900

840,900

Compactor

Caterpillar CS78LT

235,040

235,040

235,040

Shovel Motivator

TBD

$ 1,520,000

1,520,000

1,520,000

Spare Shovel Bucket

TBD

$ 2,250,000

2,250,000

2,250,000

Spare Truck Bed

TBD

300,000

300,000

$236,531,492

83

TOTAL MINE MOBILE EQUIPMENT

300,000

89

5,956,508

$201,409,692

Deferred equipment to
SUSEX Cost (since year 02).
INVESTOR PRESENTATION | 8

Preliminary Economic Analysis Impact

Operative analyses

Economic Model V3 (Mark G.)

Hudbay
RP16JUN

IMC DFS
82,90 105,149

Hudbay
RP16JUN*

IMC DFS
82,90 105,149

NPV @8%, USD M

1,403

1,188**

732

610

IRR, %

18.8%

16.4%

16.5%

15.8%

1.74

1.55

CAPEX*, USD M

1,895

1,895

1,860

1,895

OPEX*, USD M

5,569

5,046

5,900

5,466

SUSEX*, USD M

375

375

357

375

Operative Cash cost

($/Cu Lb)

1.37

1.34

1.50

1.54

Profitability Index
Payback (yrs)

Notes

NPV, IRR, PI and Cash cost calculated by Technical Services Team for comparison purpose; It does not consider Silver
Wheaton Stream and other economic and financial considerations.

* CAPEX and SUSEX cost estimation from DFS (Financial model V3 from Mark Gupta).

* OPEX defined by the following unitary costs for both mine plans:
Mine 1.14 $/ton - Mill 5.0 $/ton and G&A cost 1.0 $/ton

General cost revision for optimization and NPV improvement.

** IMC NPV is affected by Silver Wheaton stream, which is US$ ~150 M.

INVESTOR PRESENTATION | 9

Path forward After July 18, 2016

CAPEX

Geo-metallurgical study

Dry Stacking Tailing Facility, engineering update.

OPEX
o

To reduce total OPEX cost (US$) per year

Review new alternatives of optimization for mine activities.

Electric Drill alternative.

Blasting assessment, rock type evaluation.

To review and optimize Drilling and Blasting (Mine to Mill, Mine to DSTF, Mine to WRF)

Fleet Management System

Mine Maintenance Management (Strategy, major repair, overhauls, minor repairs)

SUSEX

DSTF design and loading plan

o

KP design could be very conservative.

We need to review with more details the restrictions.

Mix, waste with tailings alternative

Mine Fleet Equipment (Trucks) as a consequence of the DSTF

Dry Stacking Tailings Facility (DSTF) design and stacking plan review and optimization

WRF design and loading plan (to optimize distance and according to DSTF plan and design).

NI 43 101, Rosemont 2016

INVESTOR PRESENTATION | 10

Path forward
Project
Country
Production
Metal
Transport Method
Filter
% Solids (Sc)
Clasificacin
% Fines
Specify Gravity (SG)
Moisture content %
Density
Compactation
Annual Precipitation
Annual Evaporation
Lift width
Gradient

Un Mantos Verde La Coipa El Peon Cerro Lindo KARARA Rosemont KP 2016

ktpd

%
SUCS
%

mm
mm

Chile
12
Cu
Conveyor
Bands
82-83
SM
35-40
2.67-2.69

Chile
Chile
18
2.6
Cu
Au
trucks
trucks
Bands
Bands
79-82
82-83
ML
ML
53-55
61-65
2.76-2.78 2.60-2.62

no
<50
>2,000

no
<50
>2,000

no
<50
>2,000

<10

<10

<10

Designer

Australia
35
Fe
Conveyor
Press
84-85

USA
90
Cu-Mo-Ag
Conveyor
Press
84-85

USA
90
Cu-Mo-Ag
Conveyor
Press
84-85

>4.0
18

2.95 - 3.05
12.0 - 18.0
1.84
no
400
1,810
20m
<10

2.95 - 3.05
12.0 - 18.0
1.84
no
400
1,810
20m
<10

310
3,875
25m
<10

Only Start Up
Downstream (yr10)
No Dam
Dam
Upstream (LOM)

Dam configuration
Overall angle
Total Height
Seismic Factor

Per
15
Zn-Pb-Cu
trucks
Bands
87-88
ML
56-58
4.0-4.2
6.0 - 8.0
2.7-2.8
si
200
1,500
0.3 m
>20

2.8:1
g

>0.45

>0.30

>0.45

Rosemont Tetra
Tech - Amec 2013

Upstream

0.45

3.0:1
90
<0.30

3.5:1
180
0.33

3.5:1
180
0.33

Golder

SRK

KP

Tetra Tech Amec

INVESTOR PRESENTATION | 11

Strategic Alternatives: Ridge Line & Process Plant

| June 28, 2016

HBM

RP16JUN Strategic: Cases to optimization

Since year 06 must choose the strategy to follow the Ph06

Preliminary
Pit Shell
Constraint
Cases
Type
Whittle Factor
Cu Price, $/lb
Impact?
Process Plant
Offset, ft
Ore
Mst
TCu %
SCu %
NSR $/t
Waste
Mst
Total
Mst
SR
Additional life of mine (yrs)

RL 43
Ridge Line
Base Case
A
0.80
1.00
3.15
4.10
NO
YES
400
592
764
0.45
0.42
0.40
0.37
20.6
19.1
1,249
1,844
1,841
2,608
2.11
2.41
5

Plan view
NoRL 35
NoRL 42
without Ridge Line
B
C
0.90
1.00
3.15
3.80
NO
YES
400
841
1,006
0.42
0.39
0.37
0.35
18.9
18.0
1,720
2,390
2,561
3,395
2.05
2.38
8
13

Case C
Case B
Case A

Process
Plant

Ph06

Elevation
DSTF
WRF
Overall slope
DSTF
WRF

Mst
Mst
Mst

ft
ft
H/V
H/V

1,121
720
1,841

1,341
1,220
2,561

Current
constraints

No
constraints

5,490
5,700

5,800
5,800

3.5:1
3.0:1

3.5:1
3.0:1

Case B
Case C
Case A

STOCK &
WRF

Section view GG
Stock &
WRF

Ridge Line

Storage Capacity
DSTF
WRF
Total

320ft

Base
Case

INVESTOR PRESENTATION | 13