Doubleview (TSXV: DBV) announced the option agreement yesterday, saying its ultimate goal at Hat was to joint venture with a successful and well-respected major mining company.
"In this milestone agreement, we have achieved this goal," president and CEO Farshad Shirvani said.
Doubleview discovered Hat in 2014 and said earlier this month it was resuming exploration activity at the project, where it said numerous long drill hole intercepts and porphyry deposit modelling had shown the large potential of the deposit.
It said one of the significant intercepts included 110.16m at 1.01% copper-equivalent, within a wider 418.28m at 0.51% CuEq from 45.5m.
Under the agreement's first option, Hudbay will become operator and must spend $25 million on exploration and deliver a resource estimate within four years to earn 51%.
It can earn a further 4% by spending $15 million within the following three years, completing a pre-feasibility study and paying $1 million in cash, under the second option.
It could earn another 10%, taking its stake to 65%, by completing a feasibility study before the 10th anniversary of the agreement.
If Hudbay bows out after the first option, Doubleview can purchase a 2% interest from Hudbay for C$500,000 (US$377,000) to become 51% owner and operator.
Doubleview also has the Red Spring VMS and Mt Milligan North copper-gold exploration projects in BC.
It had requested a trading halt on Friday pending the announcement and last traded at C10c, a gain of 66.7% year-to-date, capitalising it at $10.5 million.
Hudbay has operations in the Americas and announced improved earnings and increased copper, gold and silver production in the March quarter.
Its shares closed down 3.27% to C$8.28 yesterday amid softer markets and commodity prices. Hudbay is down 25.61% year-to-date and is valued at $2.16 billion.