Hudbay and Multiple Labor Unions Announce Project Labor Agreement Letter of Intent to Support Copper World Mine Project

Rhea-AI Summary

Hudbay and several labor unions have signed a Letter of Intent for a Project Labor Agreement to build the Copper World Mine in Pima County, Arizona. The unions involved include the International Brotherhood of Boilermakers Local 627, Laborers International Union of North America Local 1184, and United Brotherhood of Carpenters and Joiners of America Local 1912.

The Copper World Mine, located 19 miles south of Tucson, is one of Arizona's largest construction projects. Over its 20-year lifespan, the mine is expected to contribute over $850 million in U.S. taxes, including $170 million to Arizona, and generate 400 direct and up to 3,000 indirect jobs. The project will offer competitive wages and benefits, and focus on local workforce training.

Additionally, Copper World plans to produce copper cathode domestically by the fourth year, reducing energy requirements and emissions. The project aims to support Arizona's green economy and provide significant economic benefits to the local community.

Positive

• Letter of Intent signed with multiple labor unions.
• Expected contribution of over $850 million in U.S. taxes over 20 years.
• Approximately $170 million in taxes to the state of Arizona.
• Creation of 400 direct and up to 3,000 indirect jobs.
• Competitive wages and benefits for workers.
• Focus on local workforce training programs.
• Reduction in energy requirements and emissions by producing copper cathode domestically.
• Support for Arizona's green economy.

Negative

• Details on potential environmental impacts are not provided.
• Success of the project heavily depends on future economic conditions.

Insights

Financial Analyst

The signing of a Project Labor Agreement (PLA) for the Copper World Mine is a significant development, with important implications for Hudbay Minerals and its stakeholders. The agreement is expected to create more than 400 direct jobs and up to 3,000 indirect jobs in Arizona, providing a strong boost to the local economy. Additionally, the company's commitment to investing in training programs and partnerships with local apprenticeship programs could help mitigate labor shortages and ensure a skilled workforce. Overall, the PLA indicates a positive collaboration between Hudbay and local labor unions, which bodes well for the project's timeline and cost management.

Financial Impact: The Copper World project is projected to generate $850 million in U.S. taxes over its 20-year life, including approximately $170 million in state taxes. The project is also expected to contribute $250 million in property taxes. These figures are indicative of a significant financial impact on the local and state economy, potentially making the project attractive to investors looking for long-term stable returns. However, investors should remain cautious about potential cost overruns and delays, which are common in large-scale industrial projects.

Market Research Analyst

The Copper World Mine project is strategically important for Hudbay Minerals as it aims to produce 'Made in America' copper cathode, which will reduce energy requirements and lower greenhouse gas emissions. This aligns with the increasing market demand for domestically produced, environmentally responsible materials. The rise in copper demand, driven by the global transition to a green economy, underscores the project's relevance. By securing domestic production capabilities, Hudbay positions itself favorably in a market where supply chain stability is becoming increasingly critical.

Market Position: The local production of copper cathode will not only reduce overseas shipping and related emissions but also potentially provide a competitive edge in terms of cost savings and environmental compliance. This can enhance Hudbay's market position and attractiveness to investors focused on ESG (Environmental, Social and Governance) criteria. The long-term commitment to community development and job creation also strengthens the company’s social license to operate, which is vital in today’s market environment.

TUCSON, Ariz., June 6, 2024 /PRNewswire/ -- Copper World, Inc. jointly announces the signing and acceptance of a Letter of Intent with several unions, including The International Brotherhood of Boilermakers, Iron Ship Builders, Forgers and Helpers Local 627; The Laborers International Union of North America Local 1184; and The United Brotherhood of Carpenters and Joiners of America Local 1912. The letter outlines the intention to enter into a mutually acceptable Project Labor Agreement for the construction of the Copper World Mine in Pima County, Arizona.

"We recognize and acknowledge the skill and professionalism of local construction unions," said Javier Del Rio, Hudbay's SVP of South America and the USA, "Recognizing how substantial the construction of this project will be, we are delighted to have our construction team include their trained and able workforce."

"Boilermakers Local 627 has been a chartered union in Arizona since 1937. The skills and abilities of Boilermakers have supported heavy industrial projects in Arizona and have supported generations of construction workers with good wages and benefits. Having a Project Labor Agreement on this project will ensure a local workforce is trained and benefits from this project remain in our community. Local 627 looks forward to working to build the Copper World Mine," said Jacob Evenson, Business Manager of Boilermakers Local 627. 

"Arizona's population is ever growing and projects such as the Copper World Mine are essential to working families. The Copper World Mine project will provide local jobs, higher wages and benefits for workers and their families. We are delighted that Copper World Inc is committed to investing in our community and in union labor. Union labor guarantees fair wages and provides skilled workers committed to building quality projects that are built to last," said Fabian Sandez, President of Carpenters Local Union 1912.

"Copper is key to a transition to a clean energy future. The Copper World Mine will not only help us transition to that future but having a PLA on this project will ensure our workers have a future in Southern Arizona. Our Laborers are the best trained workers in the construction industry and are experts at building out mining operations. We look forward to getting to work building this mine and ensuring it is a jewel in the crown of Arizona," said Michael Dea, Business Manager of Laborers Union Local 1184.

The Copper World Mine, located 19 miles south of Tucson, is one of the largest non-government-funded construction projects in Southern Arizona history and will be a crucial part of Arizona's contributions to materials needed for the green economy. The Copper World project is expected to generate significant benefits for the community and local economy in Arizona. Over the anticipated 20-year life in the proposed first phase of operation, the company expects to contribute more than $850 million in U.S. taxes, including approximately $170 million in taxes to the state of Arizona. Hudbay also expects Copper World to create more than 400 direct jobs and up to 3,000 indirect jobs in Arizona. Copper World will offer competitive wages and benefits and the company intends to engage in partnerships with local apprenticeship readiness programs and community-based workforce training programs across the skilled and technical levels to fill and maintain all positions. The project is also expected to generate approximately $250 million in property taxes over the 20-year mine life.

Copper World will be a key contributor to the domestic U.S. supply chain with the company's intention to produce "Made in America" copper cathode by building a concentrate leach processing facility in the fourth year of operations. Local production of copper cathode would reduce the operation's total energy requirements, and lower greenhouse gas and sulfur emissions by eliminating overseas shipping, smelting and refining activities relating to processing copper concentrate. Copper World is an attractive copper growth project for Hudbay and its stakeholders, which will bring many benefits to the community and local economy in Arizona.

About Hudbay
Hudbay (TSX, NYSE: HBM) is a copper-focused mining company with three long-life operations and a world-class pipeline of copper growth projects in tier-one mining-friendly jurisdictions of Canada, Peru and the United States.

Hudbay's operating portfolio includes the Constancia mine in Cusco (Peru), the Snow Lake operations in Manitoba (Canada) and the Copper Mountain mine in British Columbia (Canada). Copper is the primary metal produced by the company, which is complemented by meaningful gold production. Hudbay's growth pipeline includes the Copper World project in Arizona (United States), the Mason project in Nevada (United States), the Llaguen project in La Libertad (Peru) and several expansion and exploration opportunities near its existing operations.

The value Hudbay creates and the impact it has is embodied in its purpose statement: "We care about our people, our communities and our planet. Hudbay provides the metals the world needs. We work sustainably, transform lives and create better futures for communities." Hudbay's mission is to create sustainable value and strong returns by leveraging its core strengths in community relations, focused exploration, mine development and efficient operations.

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SOURCE Hudbay Minerals

FAQ

What is the Copper World Mine project?

The Copper World Mine project is a large-scale mining operation located 19 miles south of Tucson, Arizona, aiming to produce copper and support the green economy.

Which unions are involved in the Copper World Mine Project Labor Agreement?

The unions involved are the International Brotherhood of Boilermakers Local 627, Laborers International Union of North America Local 1184, and United Brotherhood of Carpenters and Joiners of America Local 1912.

How many jobs will the Copper World Mine project create?

The project is expected to create 400 direct jobs and up to 3,000 indirect jobs in Arizona.

What are the expected tax contributions of the Copper World Mine project?

The project is expected to contribute over $850 million in U.S. taxes over its 20-year lifespan, including approximately $170 million to the state of Arizona.

When will the Copper World Mine begin producing copper cathode domestically?

Copper World plans to produce copper cathode domestically by the fourth year of operations.

What are the environmental benefits of producing copper cathode domestically?

Producing copper cathode domestically will reduce total energy requirements and lower greenhouse gas and sulfur emissions by eliminating overseas shipping, smelting, and refining activities.