The Lalor Deposit: A New Discovery in Canada. Kelly Gilmore PDAC March 4, 2009

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1 The Lalor Deposit: A New Discovery in Canada Kelly Gilmore PDAC March 4, 2009

2 ForwardLooking Information This presentation contains "forwardlooking information" within the meaning of applicable Canadian securities legislation. Forwardlooking information includes, but is not limited to, information concerning HudBay's mineral resource estimates and potential plans for Lalor as well as HudBay's exploration and development plans and its strategies and future prospects. Generally, forwardlooking information can be identified by the use of forwardlooking terminology such as "plans", "expects", or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "does not anticipate", or "believes" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might", or "will be taken", "occur", or "be achieved". Forwardlooking information is based on the opinions and estimates of management at the date the information is made, and is based on a number of assumptions and subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forwardlooking information. Many of these assumptions are based on factors and events that are not within the control of HudBay and there is no assurance they will prove to be correct. Factors that could cause actual results to vary materially from results anticipated by such forwardlooking information include changes in market conditions, variations in ore grade or recovery rates, risks relating to international operations, fluctuating metal prices and currency exchange rates, economic factors, government regulation and approvals, environmental and reclamation risks, costs, timing and amount of future production, capital expenditures and requirements for additional capital, changes in project parameters, the possibility of project cost overruns or unanticipated costs and expenses, permitting timelines, labour disputes and the availability of skilled labour, results of exploration and other risks of the mining industry, failure of plant, equipment or processes to operate as anticipated, as well as those risk factors discussed in the Annual Information Form for the year ended December 31, 2007, and as contained in the Management Discussion and Analysis for the three and nine month period ended September 30, 2008 for HudBay Minerals Inc. available at Although HudBay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forwardlooking information, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no assurance that forwardlooking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. HudBay undertake no obligation to update forwardlooking information if circumstances or management's estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forwardlooking information. This presentation and the information contained herein does not constitute an offer of securities for sale in the United States and securities may not be offered or sold in the United States absent registration or exemption from registration. 2 The Lalor Deposit: A New Discovery in Canada

3 Location 3 The Lalor Deposit: A New Discovery in Canada

4 Flin Flon Snow Lake Greenstone Belt Background HudBay discoveries have produced: Over 155 million tonnes mined ore from over 26 deposits More than 20 million tonnes discovered since 1993 HudBay has mined at 8 mines in Snow Lake area for 50 years including Osborne, Rod, Stall, Anderson, Chisel, GhostLost, Photo, Chisel North Chisel North Mine and concentrator just placed on care and maintenance New Brittania gold mine with historical production of 1.4 million ounces gold now owned by Garson Gold 4 The Lalor Deposit: A New Discovery in Canada

5 Aerial picture of Lalor Snow Lake Chisel North Lalor 5 The Lalor Deposit: A New Discovery in Canada

6 Snow Lake Location Map and Infrastructure 15 km from Snow Lake Concentrator Geophysical discovery Discovered March drills 6 The Lalor Deposit: A New Discovery in Canada

7 Snow Lake Geology Thrust fault Synvolcanic intrusion Barren sulphide zone Zndominant deposits Cudominant deposits 7 The Lalor Deposit: A New Discovery in Canada

8 Lalor XSection 8 The Lalor Deposit: A New Discovery in Canada

9 Surface Depth in metres Diamond Drill holes Upper Chisel Sequence Lower Chisel Sequence 9 The Lalor Deposit: A New Discovery in Canada

10 Surface Diamond Drill holes Depth in metres Upper Chisel Sequence Hangingwall Fault? Lower Chisel Sequence 10 The Lalor Deposit: A New Discovery in Canada

11 Chisel Mine Chisel North Lalor Hangingwall Fault? 11 The Lalor Deposit: A New Discovery in Canada

12 Geological Section Close up 12 The Lalor Deposit: A New Discovery in Canada

13 13 The Lalor Deposit: A New Discovery in Canada

14 DUB 168: to % Zn 14 The Lalor Deposit: A New Discovery in Canada

15 Lalor Drill Holes Plan View 15 The Lalor Deposit: A New Discovery in Canada

16 Lalor Drill Holes 3D view 700m 700m 900m 900m 1100m 1300m 16 The Lalor Deposit: A New Discovery in Canada

17 Resource Estimate Zone Category Tonnes Au g/t Ag g/t Cu % Zn % 10 Main Indicated 2,092, FW #1 Indicated 1,296, Total Indicated 3,388, Zone Category Tonnes Au g/t Ag g/t Cu % Zn % 11 Main HW Inferred 289, Main Inferred 5,513, FW #1 Inferred 3,068, FW #2HW Inferred 579, FW #2 Inferred 2,252, FW #3 Inferred 1,540, Total Inferred 13,241, Mineral Resources as of June 23, 2008 NI Compliant 17 The Lalor Deposit: A New Discovery in Canada

18 The New Gold Zone Contact Gold mineralization in hanging wall and footwall of massive sulphide Separate gold mineralization Massive sulphide Zinc rich Stringer sulphide Contact Gold Mineralization Gold Copper +/ Lead Rich DUB g/t Au 0.26% Cu 15.38% Zn DUB m 26.4 g/t Au 3.74% Cu 1.52% Zn 18 The Lalor Deposit: A New Discovery in Canada

19 New Gold Mineralization Polished Samples 19 The Lalor Deposit: A New Discovery in Canada

20 Separate Gold and Electrum Separate Gold Mineralization associated with minor Chalcopyrite and Galena In Chlorite Carbonate Schist 20 The Lalor Deposit: A New Discovery in Canada

21 DUB 208W g/t Au 11.58% Zn g/t Au ZnCuPb % Aug/t Zinc Copper Gold Lead Depth m Footwall Gold Mineralization 21 The Lalor Deposit: A New Discovery in Canada

22 DUB % Zn ZnCuPb % g/t Au Au g/t Zinc Copper Gold Lead Sample Depth 0.00 Hanging wall Gold Mineralization 22 The Lalor Deposit: A New Discovery in Canada

23 DUB g/t Au 0.66% Cu 0.23% Zn ZnCuPb % Au g/t Zinc Copper Gold Lead Depth meters Separate Gold Mineralization 23 The Lalor Deposit: A New Discovery in Canada

24 Separate Gold Mineralization Legend Zone 10 Zone 11 Zone 20 Zone 30 Zone 31 Zone 40 Contact Gold to Zone 20 FW Gold Legend Zone 10 Zone 11 Zone 20 Zone 30 Zone 31 Zone 40 Contact Gold to Zone 20 FW Gold 24 The Lalor Deposit: A New Discovery in Canada

25 Zone 20 and Gold mineralization N O R T H Legend Zone 20 Contact Gold to Zone 20 FW Gold Legend Zone 20 Contact Gold to Zone 20 FW Gold 25 The Lalor Deposit: A New Discovery in Canada

26 Lalor Deposit Going Forward Infill drilling to upgrade the resource in Zone 10 and Zone 20 from the Inferred to an Indicated category Exploration drilling to define the extent and distribution of the contact and separate gold mineralization Metallurgical testing is underway The new gold mineralization could offer Lalor a distinct mining horizon with principal credits derived from gold not base metals It has the potential to considerably enhance the value of the deposit and Lalor may be developed as a gold mine rather than a zinc mine 26 The Lalor Deposit: A New Discovery in Canada

27 Acknowledgements Alan Vowles and Craig Taylor Jason Levers, Rob Carter, Alan Bailes Brian Janser and the crew at Lalor Over 26 geologists and 15 core techs so far Edgar Wright 27 The Lalor Deposit: A New Discovery in Canada

28 APPENDIX Reserves and Resources Estimated Mineral Reserves January 1, 2008 Estimated Inferred Mineral Resources January 1, 2008 Predevelopment Properties January 1, 2008 Lalor Mineral Resources 28 The Lalor Deposit: A New Discovery in Canada

29 Estimated Mineral Reserves January 1, 2008 Mine Tonnes Au (g/t) Ag (g/t) Cu% Zn (%) 777 Proven 4,464, Probable 11,224, Trout Lake Proven 1,535, Probable 831, Chisel North Proven 528, Probable 879, Balmat Proven 1,000, Probable 890, Total Proven 7,528,500 Total Probable 13,825,900 Total Reserves 21,354,400 Please refer to HudBay s Annual Information Form for the year ended December 31, 2007 and applicable technical reports in respect of the properties filed on SEDAR for further information. 29 The Lalor Deposit: A New Discovery in Canada

30 Estimated Inferred Mineral Resources January 1, 2008 Mine Tonnes Au (g/t) Ag (g/t) Cu% Zn (%) 777 1,456, Trout Lake 299, Chisel North 272, Balmat 1,442, Total 3,470,500 Please refer to HudBay s Annual Information Form for the year ended December 31, 2007 and applicable technical reports in respect of the properties filed on SEDAR for further information. Inferred resources diluted, recovered and economically tested. 30 The Lalor Deposit: A New Discovery in Canada

31 Predevelopment properties: Estimated Mineral Reserves January 1, 2008 Property Tonnes Au (g/t) Ag (g/t) Cu (%) Zn (%) Pb (%) Tom Indicated 4,980, Inferred 13,550, Jason Indicated 1,450, Inferred 11,000, Watts River Indicated Inferred 6,623, Bur Indicated 1,050, Inferred 302, Total Indicated 7,490,000 Total Inferred 31,475,000 Please refer to HudBay s Annual Information Form for the year ended December 31, 2007 and applicable technical reports in respect of the properties filed on SEDAR for further information. 31 The Lalor Deposit: A New Discovery in Canada

32 Reserves and Resources HudBay Minerals To estimate mineral reserves, measured and indicated mineral resources were first estimated by a 12step process, which includes determination of the integrity and validation of the data collected, including confirmation of specific gravity, assay results and methods of data recording. The process also includes determining the appropriate geological model, selection of data and the application of statistical models including probability plots and restrictive kriging to establish continuity and model validation. The resultant estimates of measured and indicated mineral resources are then converted to proven and probable mineral reserves by the application of mining dilution and recovery, as well as the determination of economic viability using historical operating costs. Other factors such as depletion from production are applied as appropriate. Long term metal prices, including premiums, used to determine economic viability of the 2008 mineral reserves were US $550 oz. gold, US $11.00 oz. silver, US $1.45 lb. copper and US $0.75 lb. zinc. Estimated inferred mineral resources within HudBay mines were estimated by a similar 12step process, used to estimate measured and indicted resources. The inferred mineral resources tabulated above and contained in HudBay mines are compliant with the requirements of NI and additionally have had dilution and recovery applied and have been economically tested using the same historical costs and long term metal prices as those used for the estimation of mineral reserves. The 2008 estimated measured and indicated mineral resource and the estimated inferred mineral resource were prepared under the supervision of Kimberley Lau, B.Sc., P.Geo, who is employed by Hudson Bay Mining and Smelting Co., Limited (HBMS), a whollyowned subsidiary of HudBay, as Superintendent, Mining Technical Services and who is a Qualified Person under NI The 2008 estimated mineral reserve and the estimated diluted, recovered and economically tested inferred mineral resources have been prepared under the supervision of Gerald Beauchamp, B.Sc., P.Eng., who is employed by HBMS as Senior Mines Analyst and who is a Qualified Person under NI Please refer to HudBay s Annual Information Form for the year ended December 31, 2007 and applicable technical reports in respect of the properties filed on SEDAR for further information. 32 The Lalor Deposit: A New Discovery in Canada

33 Lalor Mineral Resources Tonnes Au Ag Cu Zn (millions) (g/t) (g/t) (%) (%) Indicated Inferred Notes: 1. CIM Definitions were followed for the estimation of Mineral Resources. 2. Mineral Resources are estimated at a zinc equivalency (ZNEQ) cutoff of 4% (ZNEQ% equals Zn% + Cu% x Au g/t x Ag g/t x 0.009) and a minimum two metre true width. 3. Long term $US metal prices of $700/oz gold, $12.00/oz silver, $2.00/lb copper and $0.85/lb zinc were used for the estimation of ZNBQ. 4. Metal recovery assumptions of 65% gold, 60% silver, 90% copper and 90% zinc were used for the estimation of ZNBQ. 5. Specific gravity measurements using industry standard techniques were completed on all assayed intervals. The mineral resource estimate included above was prepared by Robert Carter, P. Eng., Senior Mines Analyst of HBMS, and audited by Ian Blakley, P. Geo., Senior Consulting Geologist of Scott Wilson RPA. Both are Qualified Persons under NI and have reviewed and approved the contents. Source: The Technical Report dated September 19, 2008 in respect of HudBay s Lalor property and available on SEDAR. 33 The Lalor Deposit: A New Discovery in Canada