A private Denver, Colorado-based concern GRG International Corp reported this week it had completed the sale of 187 mining claims to Hudbay.

It described it as "a rare consolidated" land package that included 87 past-producing patented lode-mining claims in the Yerington Copper District next to Hudbay's Mason ground.

The land package is said to feature four underground mines previously worked by colonel William Boyce Thompson, Newmont's founder.

The HudBay agreement includes an upfront cash payment of US$3.5 million, plus additional obligations including two milestone payments based on Hudbay reporting resources. Hudbay has also agreed to buy down a 0.5% net smelter royalty (NSR) for $500,000 and has the option to further reduce the NSR by 1%, leaving GRG with a perpetual 1% royalty.

Hudbay first entered the Yerrington district in late 2018 with the acquisition of Mason Resources for C$31 million amid shareholder opposition to the move. Hudbay said at the time the Ann Mason project was "an ideal fit for Hudbay's development pipeline".

The project hosts compliant measured and indicated resources of 1.4 billion tonnes grading 0.32% copper, 0.006% molybdenum, 0.03 grams per tonne gold and 0.65g/t silver, as well as an inferred resource of 623Mt grading 0.29% copper, 0.007% molybdenum, 0.03g/t gold and 0.66g/t silver using a 0.2% copper cut-off.

A 2017 Ann Mason preliminary economic assessment, based on a US$3/lb copper price, $11/lb molybdenum, $1,200/oz gold and $20/oz for silver, delivered a base case net present value (post-tax at a 7.5% discount rate) for a $1.35 billion develoment project of $770 million and an internal rate of return of 13.7%.

Production was estimated at 5.1Blb copper over a 21-year mine life, or 241Mlb per annum.

Also in the district is Nevada Copper's new Pumpkin Hollow mine.

Hudbay shares (TSX:HBM) advanced 5.5% in Toronto on Wednesday to C$8.96. It has a market cap of $2.34 billion (US$1.8 billion).