VMS Ventures reported in early April 2012 that HudBay Minerals and Stantec Consulting have completed a positive NI 43-101 compliant prefeasibility study for the underground Reed joint-venture copper mine in Manitoba.

The project is owned 70% by HudBay and 30% by VMS and is based on a high-grade copper deposit located 120 km east of Flin Flon, Manitoba. The project received HudBay board approval to proceed to full construction in December 2011, and first production is expected by late 2013. Mine life is currently projected at five years.

Initial capital to develop the Reed mine is estimated at C$71.9 million. Run-of-mine ore will be transported by truck to HudBay’s Flin Flon concentrator, where it will be crushed to less than 150 mm. The Reed ore will be batched separately through the concentrator, with assumed metal recoveries of 94% copper, 58% gold and 62% silver in a copper concentrate. Production from the Reed ores is expected to average 17,000 mt/y of copper in concentrate.

Access to the underground Reed mine will be via a trench, portal, and decline located near the center of the surface site. The decline will be excavated 6 m wide and 5 m high to a depth of 510 m from surface and will be able to accommodate a 60-mt truck. Mining levels will be spaced 25 m vertically and will be accessed from the decline. Level development will be 5.5 m wide by 4.5 m high to accommodate a 10-yd3 Scooptram. Mining will be at a rate of 1,300 mt/d, using long-hole open stoping methods.

Infrastructure required at the Reed site includes an employee camp, mine office and changehouse dry, mechanical shop, warehouse, core shack, explosive magazine, electrical generator and fuel storage area, electrical office, ventilation downcast building, and compressor building.

As of March 30, 2012, the Reed project had probable minerals reserves totaling 2.2 million mt, grading 3.83% copper, 0.59% zinc, 0.48 g/mt gold, and 6.02 g/mt silver. HudBay and VMS are optimistic that additional resources can be developed down-dip from the current reserves.

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