07:01 AM EDT, 03/13/2024 (MT Newswires) -- Hudbay Minerals Inc. ( HBM ) on Wednesday announced the signing of an option agreement granting Marubeni Corporation's Canadian subsidiary an option to acquire a 20% interest in three projects located within trucking distance of Hudbay's processing facilities in Flin Flon, Manitoba.

Marubeni will fund at least $12 million in exploration expenditures over five years with Hudbay acting as operator and carrying out the exploration activities. Upon completion of Marubeni's earn-in obligations, a joint venture will be formed to hold the selected projects, with Hudbay, acting as operator, holding an 80% interest and Marubeni holding the remaining 20% interest.

The agreement follows the signing of a memorandum of understanding between the parties that set out the framework for a multi-year exploration partnership, as previously announced in July 2023.

"This exploration partnership with Marubeni represents a significant milestone towards unlocking potential future value in the Flin Flon region," said Peter Kukielski, Hudbay's President and CEO. "This arrangement allows us to partner with Marubeni and leverage our operational and exploration expertise to test our large Flin Flon land package to potentially bring another mine into production and utilize Hudbay's idle processing infrastructure in Flin Flon."