Mr. Peter Kukielski reports

HUDBAY RELEASES COPPER MOUNTAIN TECHNICAL REPORT AND ADVANCES MINE STABILIZATION PLANS

Hudbay Minerals Inc. has completed a National Instrument 43-101 technical report in respect of its 75-per-cent-owned Copper Mountain mine in British Columbia, Canada. This is Hudbay's first technical report for the Copper Mountain mine since acquiring Copper Mountain Mining Corp. (CMMC) in June, 2023. All dollar amounts are in U.S. dollars, unless otherwise noted.

"We are pleased to release our first mine plan for Copper Mountain which demonstrates the meaningful copper production this long-life asset brings to our operating platform and the unique opportunity we have to leverage our efficient operating capabilities to drive value," said Peter Kukielski, Hudbay's president and chief executive officer. "We have applied our proven reserve and resource estimation methodology to develop a prudent and reliable mine plan and are now positioned to implement several operating enhancements to transform Copper Mountain into a stable cash flow generator for our business. With the addition of Copper Mountain, we expect to maintain annual consolidated copper production above 150,000 tonnes through to the end of the decade and are better positioned to achieve our deleveraging objectives and deliver on future copper growth. This increased scale and diversification enhances the company's ability to prudently advance our organic growth pipeline of brownfield expansion and greenfield development opportunities in Tier 1 mining jurisdictions."

Mine plan summary

The Copper Mountain mine is located 21 kilometres south of the town of Princeton and 304 kilometres east of Vancouver. The operations include a series of open pits, an ore processing plant, a waste rock facility, a tailings management facility and other ancillary facilities that support the operations. All claims are controlled by Copper Mountain Mine (B.C.) Ltd., a joint venture held 75 per cent by Hudbay and 25 per cent by Mitsubishi Materials Corp.

The mine plan contemplates average annual copper production of 46,500 tonnes in the first five years, 45,000 in the first 10 years and 37,000 tonnes over the 21-year mine life. Average cash costs and sustaining cash costs over the mine life are expected to be $1.84 and $2.53 per pound of copper, respectively. The updated mine plan represents an approximate 90-per-cent increase in average annual copper production and a 50-per-cent decrease in cash costs over the first 10 years compared with 2022.

Copper Mountain increases Hudbay's expected consolidated annual copper production by approximately 50 per cent and maintains the 150,000-tonne-per-year level beyond 2025.

A summary of key production and cost details can be found herein.

Hudbay's stabilization plans

Since completing the acquisition of CMMC in June, 2023, Hudbay has been focused on advancing its plans to stabilize the Copper Mountain mine over the next few years to improve reliability and drive sustainable long-term value. The technical report reflects Hudbay's base case stabilization plan, including many elements as described further below.

Increased mining activities

The company has commenced a fleet ramp-up plan which remobilizes idle haul trucks. The fleet ramp-up plan entails a ramp-up from 14 trucks to 26 trucks by the end of 2023, with 23 trucks ramped up to date. Once the fleet ramp-up plan is complete, Copper Mountain is expected to have improved flexibility in the mine with additional mining faces.

Accelerated stripping to access higher grades

As reflected in the technical report, the company is planning a campaign of accelerated stripping over the next three years to enable access to higher-grade ore and to mitigate the substantially reduced stripping undertaken by Copper Mountain over the four years prior to completion of the acquisition. The accelerated stripping program is also expected to improve operating efficiencies and lower unit operating costs. A portion of the accelerated capitalized stripping costs is considered discretionary and could be reduced or deferred to a later date based on further geotechnical evaluation and other considerations.

Improved mill throughput and recoveries

Hudbay's mine plan for Copper Mountain assumes a mill ramp-up to its nominal capacity of 45,000 tonnes per day in 2025. An expansion to the permitted capacity of 50,000 tonnes per day is planned in 2027. The mine plan assumes approximately $23-million in growth capital spending over 2025 and 2026 in connection with the mill expansion. The company also plans to improve mill recoveries with a more consistent ore feed grade, changes to the flotation reagents and replacement of key pumps.

Operating efficiencies and corporate synergies

Hudbay's stabilization plans as reflected in the technical report are expected to generate more than $20-million in annual operating efficiencies over the next three years, compared with Copper Mountain's performance in 2022, through improvements in copper recovery, higher throughput rates and lower combined unit operating costs. In addition, Hudbay has realized approximately $9-million of the targeted $10-million in annual corporate synergies and is on track to exceed the target. A full comparison of Hudbay's plan versus Copper Mountain's 2022 performance is presented in the attached table.

Mineral reserve and resource estimates

The mine plan is based on a revised resource model and was constructed using the same methods applied at the Constancia, Copper World and Mason deposits. The mineral reserve estimates total 367 million tonnes at a copper grade of 0.25 per cent and a gold grade of 0.12 gram per tonne, supporting a 21-year mine life. An additional 140 million tonnes of measured and indicated resources at 0.21 per cent copper and 0.10 gram per tonne gold and 370 million tonnes of inferred resources at 0.25 per cent copper and 0.13 gram per tonne gold, exclusive of mineral reserves, provide significant upside potential for reserve conversion and extending mine life. Infill drilling is planned for 2024 to target reserve conversion.

The current mineral reserve and resource estimates for Copper Mountain (effective as of Dec. 1, 2023) are summarized herein.

Consistent with the expectations disclosed in the company's news release on Nov. 7, 2023, the 2023 mineral reserve and mineral resource estimates are consistent with historical estimates published by CMMC until 2019, after adjusting for mining depletion and a reclassification of some of the indicated mineral resources to the inferred category, as well as incorporating high-grade resources added through exploration since 2019. Hudbay's new 2023 resource estimates are closely aligned with production with both tonnage and grade reconciling positively within 3 per cent to 4 per cent of the credited mine production by the mill over the past three years.

Project optimization and upside opportunities

There are several opportunities to further increase production, improve costs and extend mine life for Copper Mountain. While these opportunities have not been considered in the technical report as they are not yet at the level of required engineering, the company is advancing studies to evaluate the potential for these to be reflected in future mine plans.

• Conversion of inferred resources to reserves -- there is a significant amount of high-grade mineralization in the inferred category that has the potential to be converted to reserves, which would increase production, improve head grades over the next 10 years and extend mine life beyond 21 years. The company has plans for infill drilling in 2024 to target reserve conversion.
• Lower stripping costs -- the company will carry out additional geotechnical investigations and pit slope stability tests in the area of Pit 3 to identify opportunities to maximize the use of double benching and reduce waste stripping that is currently classified as discretionary.
• Evaluation of mining technologies -- Hudbay will pursue technology trade-offs between trolley assist haul trucks and conveying systems for ore and waste movement in an effort to reduce mining costs, improve mining productivity and reduce greenhouse gas emissions.
• Continued process optimization -- Hudbay continues to conduct metallurgical testing and simulations to optimize mill throughput and recoveries.
• Renewable diesel -- Hudbay is evaluating the application of renewable diesel at Copper Mountain, which has the potential to reduce costs, lower greenhouse gas emissions and be eligible for additional federal tax credits under Canada's Clean Fuel Regulations.
• Green opportunities -- the company plans to install a mast to collect wind data to be able to evaluate the potential for site renewable energy generation. This initiative is in addition to the existing net-zero initiatives already under way, including trolley assist haulage and a new electric shovel, which favourably position Copper Mountain in the lowest quartile of the greenhouse gas emissions curve for copper mines.

Cautionary note regarding National Instrument 43-101

The scientific and technical information contained in this news release has been approved by Olivier Tavchandjian, PGeo, Hudbay's senior vice-president, exploration and technical services. Mr. Tavchandjian is a qualified person pursuant to Canadian Securities Administrators' National Instrument 43-101 -- Standards of Disclosure for Mineral Projects.

A copy of the NI 43-101 technical report will be made available on Hudbay's SEDAR+ profile and on Hudbay's EDGAR profile. This technical report is the current technical report in respect of the Copper Mountain mine and shall supersede and replace all prior technical reports relating to the Copper Mountain mine.

About Hudbay Minerals Inc.

Hudbay is a copper-focused mining company with three long-life operations and a world-class pipeline of copper growth projects in Tier 1 mining-friendly jurisdictions of Canada, Peru and the United States.

Hudbay's operating portfolio includes the Constancia mine in Cusco (Peru), the Snow Lake operations in Manitoba (Canada) and the Copper Mountain mine in British Columbia (Canada). Copper is the primary metal produced by the company, which is complemented by meaningful gold production. Hudbay's growth pipeline includes the Copper World project in Arizona, the Mason project in Nevada (United States), the Llaguen project in La Libertad (Peru), and several expansion and exploration opportunities near its existing operations.

We seek Safe Harbor.