HudBay eyeing new zinc sources

BALMAT — Exploration for zinc continues despite the shutdown of the mines in the town of Fowler.

"HudBay wants to continue working with the assets they have here," said Ryan P. Schermerhorn, mill superintendent for St. Lawrence Zinc, which runs HudBay's Balmat operations. "This area has had a very long and prosperous history. Hopefully, we'll get a few hits."

As a follow-up to electromagnetic mapping conducted in 2008 with the aid of a helicopter, St. Lawrence Zinc has identified more than 20 sites within a 25-mile radius of Balmat that deserve a closer look.

"They've gone through and prioritized them," Mr. Schermerhorn said. "Our hope is to find a good source within easy trucking distance."

St. Lawrence County has the mineral rights on some of the sites, including three in the town of Edwards, County Administrator Karen M. St. Hilaire said.

One of the properties to which the county has the mineral rights is owned by St. Lawrence Zinc, while the other two are privately owned. All three are contiguous, Ms. St. Hilaire said.

"They'd obviously have to work with the surface owners," she said.

St. Lawrence Zinc is interested in an option with the county on the mineral rights, with the possibility of a lease if further research shows extensive deposits, Ms. St. Hilaire said.

"It just means a possibility for exploration," she said.

County officials are fine-tuning the issues they need to map out with St. Lawrence Zinc before making a recommendation to legislators, Ms. St. Hilaire said.

On Friday, HudBay announced it is reopening its Chisel North mine and concentrator in Manitoba, which it closed earlier this year because of weak zinc prices. With the price of zinc at about $1 per pound, HudBay believes it is profitable to reopen the mine.

The Balmat mine also was shut down because of low zinc prices, but a reopening of that operation isn't planned anytime soon.

"Balmat is a significantly higher cost producer. It has to do with grades of ore," said John Vincic, HudBay vice president for investor relations and corporate communications. "We'd have to see numbers of about $1.25 per pound before we could consider it."

Over the long term, HudBay is predicting zinc prices closer to 85 cents per pound, he said.