To help fund the project, the Toronto-based miner said it has entered into an agreement with Silver Wheaton Corp. SLW +5.26% pursuant to which Silver Wheaton will acquire 100% of the life-of-mine silver production from HudBay's currently producing 777 mine in Canada and 100% of the life-of-mine silver production from Constancia.

Silver Wheaton has also agreed to acquire 100% of the life-of-mine gold production from the 777 mine until Constancia satisfies a completion test, or the end of 2016, whichever is later. At that time, its share of gold production from 777 will be reduced to 50% for the remainder of the mine life.

HudBay will get a total of $750 million from the precious-metals stream agreement, including a $500 million payment on closing, Dow Jones Newswires reported.

The company said it's projecting nine quarters of construction for the Peru mine, with initial production in late 2014 and full production in the second quarter of 2015. That timeline to completion is shorter than previously forecast, it noted.

Annual contained copper metal in concentrate is expected to average about 118,000 metric tons during the first five full years of production (2015-2019) and 77,000 tons in subsequent years. Operating cash costs, net of by-product credits, are seen averaging 66 cents per pound of copper for the first five years of production, and $1.11 thereafter.

Hudbay also said it is arranging a new $600 million credit facility from a syndicate of Canadian and international banks. The company said planned capital spending on Constancia and its Lalor and Reed mining projects in Canada totals about $2 billion, and that it expects to fund this requirement with a combination of $710 million in cash on hand, operating cash flow, and the funds received under the precious-metals stream transaction and credit facility.

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