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"With the potential to be one of the world's largest, lowest cost zinc producers, we expect Taylor will deliver value for our shareholders for decades to come."

Graham Kerr
South32 CEO


15 February 2024

We are pleased to announce final investment approval for the Taylor deposit, the first development at our Hermosa project in Arizona, United States.

Final investment approval to develop Taylor is a major milestone aligned with our strategy to reshape our portfolio toward commodities that are critical for a low-carbon future.

Taylor is expected to deliver attractive returns over multiple decades, with the feasibility studyconfirming the potential for a long-life, low-cost, low-carbon operation, with an initial operating life of ~28 years(a), an average EBITDA margin of ~50% and an internal rate of return of ~12%.

The South32 Board has approved the development of Taylor, for direct and indirect capital expenditure of US$2,160M. Taylor is expected to reach first production in H2 FY27 and deliver nameplate production in FY30.

See the full announcement




100% owned by South32, Hermosa is located in the Patagonia Mountains in southern Arizona, about 80 kilometres southeast of Tucson.

Hermosa is in Santa Cruz County, with the town of Patagonia located to the north and Nogales and Rio Rico to the west. It is situated less than 20 kilometres north of the United States-Mexico border.


Hermosa is the only advanced mine development project in the United States as of 2024 that could produce two federally designated critical minerals — zinc and manganese.

While the final investment decision we've announced relates to the Taylor zinc-lead-silver deposit, the broader Hermosa project includes other opportunities co-located on the same land package.

Beyond Taylor, it also comprises the Clark battery-grade manganese deposit and an extensive, highly prospective land package with the potential for further polymetallic and copper mineralisation. Exploration drilling is ongoing at our Peake copper prospect, located south of Taylor, and at our Flux prospect, which has the potential to host Taylor-like mineralisation.

Swipe through below to learn more about the components of the Hermosa project.


"Once in production, Taylor is expected to add an additional 8% to Group volumes relative to FY23 levels, increasing our supply of critical commodities and sustainably lifting margins due to its first quartile cost position."

Graham Kerr
South32 CEO


~28 years

initial operating life

~4.3 Mt

nameplate processing capacity

H2 FY27

first production expected

The final investment decision for the Taylor deposit follows the completion of a feasibility study, which confirmed the potential for a long-life, low-cost, low-carbon operation that is expected to deliver attractive returns over multiple decades.

The feasibility study shows that Taylor has the potential to be one of the world’s largest, lowest cost zinc producers, supplying a critical metal needed for the adaption and strengthening of future renewable energy infrastructure.

Taylor is designed to be the first phase of a regional scale opportunity at Hermosa, with ongoing activities to unlock additional value from the Clark battery-grade manganese deposit and exploration opportunities in our highly prospective regional land package.


Efficient, large scale and long-life

Potential top 10 global zinc producer with an initial operating life of ~28 years, and potential to realise further exploration upside

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A low-cost operation

Average operating unit costs of ~US$86/t ore processed - in the industry's first quartile

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Attractive returns

Average annual EBITDA of ~US$400M in steady state production at a margin of ~50%

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A regional scale opportunity

Infrastructure established for Taylor will unlock value for the Clark deposit and future potential discoveries at Hermosa

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Strengthening our position

Taylor is expected to add the equivalent of an additional ~8% to Group production, increasing our exposure to commodities critical to a low-carbon future

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A pathway to net zero

Mine designed to enable a future all-electric underground mining fleet - supporting a potential low-carbon operation

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A low-impact mine creating local jobs

Taylor will be a small footprint underground mine, and is expected to create hundreds of jobs

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Taylor has been designed to minimise its environmental impact, featuring a small footprint underground mine with efficient water use and dry-stack tailings. 

The design for Taylor as assessed by the feasibility study is a dual shaft underground mine, employing longhole open stoping with paste backfill. The mine development schedule has been aligned to a federal permitting process under FAST-41, which enables earlier access to multiple mining areas and an efficient ramp up to nameplate processing capacity of 4.3Mtpa.

Shaft sinking is on-track to commence in Q1 FY25, with first production targeted in H2 FY27 and nameplate production rates in FY30.

Ore will be mined in an optimised sequence concurrently across four independent mining areas, crushed underground and hoisted to the surface for processing. The mine design contemplates two vertical shafts, for access, ore hoisting, ventilation and cooling. The primary haulage and material handling level is expected to be located at a depth of approximately 800m.

Remote operations

Remote operations

Hermosa will use extensive automation technology and, in part, be run remotely from an Integrated Remote Operating Center (iROC) within Santa Cruz County.

The iROC will monitor and control mining, processing, maintenance and engineering to ensure the integration of activities and to optimise the entire value chain.

As an underground zinc-lead-silver mine, many of the learnings and processes from our Cannington operation in Australia will support the way we operate at Hermosa. This includes remote operations as well as other innovative technologies which are now being trialed in the field at Cannington.

Site infrastructure

Site infrastructure

We have made substantial progress installing initial non-process infrastructure, including required tailings, power and dewatering infrastructure.

The feasibility study includes two state-of-the-art dry stack tailings storage facilities (TSFs) that have been designed in accordance with South32’s Dam Management Standard. All tailings will be thickened and filtered with approximately half sent back underground as paste backfill with the potential to further reduce our surface footprint by using processed tailings from Taylor as paste backfill for Clark.

Dewatering is a critical phase activity that will enable access to both the Taylor and Clark deposits. Dewatering requirements will be met through two water treatment plants, with the second water treatment plant recently commencing operation. We have installed four of seven required dewatering wells, recently commissioning two critical wells that will enable the first ten years of mining at Taylor.


Hermosa is currently the only advanced project in the United States that could supply two federally designated critical minerals — zinc and manganese.

With the development of Taylor set to produce zinc, as well as silver and lead, it is poised to play an important role in supporting the global energy transition over the coming decades.

Elsewhere at Hermosa, the potential for Clark to produce battery-grade manganese for the domestic US market is promising, and well positioned to serve a vital market as battery technology continues to evolve - while the potential production of copper from Peake would supply another important and in-demand commodity.



Zinc has an important role to play in renewable energy technologies and the infrastructure associated with them.

Zinc is a metal widely used for galvanising iron and steel to protect against corrosion, as well as a wide range of other applications.

It is needed to make infrastructure weather resilient, providing a protective coating to weather exposed steel structures such as wind turbines.

Strong outlook

With global zinc demand growth expected to outpace production by ~3Mt to 2031, an industry challenge of similar magnitude to copper, we expect higher incentive zinc prices as Taylor ramps up to nameplate capacity.

Conversely, zinc mine supply is constrained. Despite higher prices, China, the world’s largest producer, has not been able to lift supply due to rising environmental regulations and declining grades. Globally, processed zinc grades have nearly halved since the early 2000s, and Taylor has been the only major discovery in the past decade.

Zinc demand is forecast to grow at 2% per annum (vs. 1% in the prior decade) to 2031, supported by increasing intensity of use and the rapid deployment of wind and solar infrastructure.



Silver has been in use for thousands of years, but its unique properties have meant that it has a wide range of important applications in modern technologies.

In particular, silver is an excellent conductor of heat and electricity, even when tarnished. For this reason, it is widely used in electronics in a number of ways, particularly in connectors, circuitry and solder, but with a range of other uses as well. Electronics are now the most common use of silver.

Silver is also a key component for the production of solar photovoltaic cells, playing an important role in converting the sun's light into electricity as a conductor.

Elsewhere, silver's anti-bacterial properties give it important applications in medical equipment and water purification.

Silver demand is also expected to benefit from the global energy transition, as the preferred metal used in solar panels due to its superior electrical conductivity. There are very few high-silver polymetallic options identified globally, supporting the potential for a material market deficit. 




Lead is a heavy metal that is now mainly used in batteries. Rechargeable lead-acid batteries are widely used in the automotive industry for starting cars, and they are also used in electric vehicles. Lead-acid batteries are also used in a range of contexts to support and store energy from various renewable energy technologies.

Lead demand is also expected to be supported by growth in renewable energy infrastructure, with the safety-related and low-cost characteristics of lead-acid batteries making them an attractive choice for renewable energy storage.

We expect that rising lead scrap production will be insufficient to balance the projected market shortfall, requiring new mine supply and incentive prices.

Lead also has important medical and industrial uses as a shield for radiation and to contain corrosive liquids, among other applications.


The decision to invest US$2.16 billion to develop the Taylor deposit represents the largest-ever private investment in Southern Arizona.

Local jobs in Santa Cruz County

Local jobs in Santa Cruz County

Development of the Taylor Deposit is set to create hundreds of good-paying local jobs and support economic growth throughout the region.

Currently, Hermosa directly employs more than 150 people, as well as supporting hundreds of jobs through contractors and vendors.

Once fully operational, the project is expected to support up to 900 direct jobs, including mining and processing operators, engineers, geologists, electricians and technicians, as well as environment, health and safety, information technology, finance, external relations and human resources.

We have set a goal to have at least 80% of our workforce living and working in Santa Cruz County, ensuring downstream economic benefits flow to the local region.


Up to 900

direct jobs


indirect and induced jobs created across Arizona


local workforce goal

*Estimates include jobs generated by both the Taylor and Clarke deposits


To help local residents secure the quality, good-paying jobs which the Hermosa project will create, we have already established a new Workforce Development Taskforce.

The taskforce is tasked with identifying the skills needed and local facilities available to help train, develop and expand the region’s workforce. The taskforce enables the Hermosa team to work with local education experts to develop a clear pathway for training local residents to fill skilled jobs at the project.

By partnering with community members and making use of their expertise and understanding of the region’s educational needs, the taskforce has an important role to play in helping to transform the local economy.

Related information

Local information

See local information and learn more about the Hermosa project and its significance of the project to Santa Cruz, Southern Arizona and the broader United States on their local website.

(a) The information in this announcement that refers to Production Target and forecast financial information is based on Probable (65Mt, 61%) Ore Reserves and Measured (1.1Mt,1%), Indicated (4.7Mt, 5%), Inferred (10Mt, 9%) Mineral Resources and Exploration Target (26Mt, 24%) for the Taylor deposit. The Ore Reserves, Mineral Resources and Exploration Target underpinning the Production Target, included in this announcement, have been prepared by a Competent Person and reported in accordance with the JORC Code (2012). All material assumptions on which the Production Target and forecast financial information is based are provided in Annexure 1 of this announcement. There is low level of geological confidence associated with Inferred Mineral Resources and there is no certainty that further exploration work will result in the determination of Indicated Mineral Resources or that the Production Target will be realised. The potential quantity and grade of the Exploration Target is conceptual in nature. In respect of Exploration Target used in the Production Target, there has been insufficient exploration to determine a Mineral Resource and there is no certainty that further exploration work will result in the determination of Mineral Resources or that the Production Target itself will be realised. The stated Production Target is based on South32’s current expectations of future results or events and should not be solely relied upon by investors when making investment decisions. Further evaluation work and appropriate studies are required to establish sufficient confidence that this target will be met. South32 confirms that inclusion of 33% of tonnage (9% Inferred Mineral Resources and 24% Exploration Target) is not the determining factor of the project viability and the project forecasts a positive financial performance when using 67% tonnage (61% Probable Ore Reserves and 1% Measured and 5% Indicated Mineral Resources). South32 is satisfied, therefore, that the use of Inferred Mineral Resources and Exploration Target in the Production Target and forecast financial information reporting is reasonable. 

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