TALV.L Regulatory News (TALV)

4 Dec 2007 07:02

Talvivaara Mining Company Ltd04 December 2007 04 December 2007 Talvivaara announces significant increase in Mineral Resource Talvivaara Mining Company Ltd ("Talvivaara" or "the Company"), the Finnishmining company with a primary focus on nickel and zinc, is pleased to announce a26% increase (76 million tonnes) in Measured and Indicated Mineral Resources, asdefined by the JORC code, and a 23% increase (77 million tonnes) in Measured,Indicated and Inferred Resources, as defined by the JORC code, in the Kuusilampiand Kolmisoppi deposits in Sotkamo, Finland. The 26% addition now takes theMeasured and Indicated Resources to a total of 336 million tonnes and the totalMineral Resource up to 414 million tonnes. The increased resources contain 1.1million tonnes (up from 0.89 million tonnes) of nickel metal and 2.2 milliontonnes of zinc metal (up from 1.6 million tonnes), reaffirming Talvivaara'sposition as one of the top nickel mines globally and as an internationallysignificant zinc producer. The resource increase is within the existing known resource body and excludesany additional resources Talvivaara may identify in adjacent areas or betweenthe deposits. It results from a drilling campaign focused on ore boundarydefinition at the Kuusilampi orebody. The Kuusilampi Mineral Resource now totals248 million tonnes in Measured and Indicated Categories and 304 million tonneswith Inferred Resource included. The Kuusilampi orebody is still open at north,east, south and at depth. Mineral Resources at the Kolmisoppi deposit remain at their previous levels, asthe in-fill drilling campaign only covered the Kuusilampi deposit inanticipation of the planned production start-up in 2008. Talvivaara is currently evaluating its options with regard to this significantincrease. As part of this, Talvivaara has commenced a study to maximiseshareholder benefits through production expansion. The study is expected tocontinue through the coming year and have emphasis on economic, technical andenvironmental permitting aspects. It will continue in conjunction with theplanned project development and will have no impact on the timing of scheduledproduction to commence in late 2008. Pekka Pera, CEO of Talvivaara, commented: "We are extremely pleased that thisnotable increase in resources has arisen from the Kuusilampi in-fill drilling,and that this leaves the significant exploration potential we possess stillcompletely untouched. The Kuusilampi deposit alone now offers Measured andIndicated Resources that are equal to the two deposits previously combined. Thisshould give rise to significant cost savings even with the planned capacity dueto decreased waste mining. In addition, on average, the newly defined resourcesare also closer to surface, which reduces vertical transportation costs." The updated and previously published Mineral Resource tables based on 0.15%nickel cut-off grade are presented below. For reference, the Mineral Resourceestimates are also presented as calculated with 0.07% nickel cut-off. The lowercut-off is based largely on raised consensus long term metal prices. The newmine production plan under preparation will apply the 0.07% cut-off. Table 1: Kuusilampi and Kolmisoppi Resources as of 4 December 2007 (at 0.15% nickel cut-off) Tonnage Grade / Product Mineral Resource (Mt) (Ni %) (Mt Ni) (Co %) (Mt Co) (Cu %) (Mt Cu) (Zn %) (Mt Zn) Measured 199.3 0.27 0.54 0.02 0.04 0.14 0.28 0.54 1.08Kuusilampi 156.6 0.27 0.42 0.02 0.03 0.14 0.22 0.54 0.85Kolmisoppi 42.7 0.28 0.12 0.02 0.01 0.15 0.06 0.56 0.24 Indicated 136.8 0.27 0.37 0.02 0.03 0.14 0.19 0.56 0.77Kuusilampi 91.5 0.27 0.25 0.02 0.02 0.14 0.13 0.57 0.52Kolmisoppi 45.3 0.26 0.12 0.02 0.01 0.14 0.06 0.54 0.24 Measured + Indicated 336.1 0.27 0.91 0.02 0.07 0.14 0.47 0.55 1.84 Inferred 77.7 0.24 0.19 0.02 0.02 0.14 0.11 0.49 0.38Kuusilampi 54.3 0.24 0.13 0.02 0.01 0.14 0.08 0.50 0.27Kolmisoppi 23.4 0.23 0.05 0.02 0.00 0.13 0.03 0.48 0.11 Total 413.8 0.26 1.09 0.02 0.08 0.14 0.58 0.54 2.22 Table 2: Kuusilampi and Kolmisoppi Resources as of 4 December 2007 (at 0.07% nickel cut-off). Tonnage Grade / Product Mineral Resource (Mt) (Ni %) (Mt Ni) (Co %) (Mt Co) (Cu %) (Mt Cu) (Zn %) (Mt Zn) Measured 263.2 0.25 0.65 0.02 0.05 0.14 0.36 0.52 1.37Kuusilampi 201.3 0.25 0.50 0.02 0.04 0.14 0.28 0.52 1.04Kolmisoppi 61.9 0.25 0.15 0.02 0.01 0.14 0.09 0.52 0.32 Indicated 189.5 0.23 0.43 0.02 0.04 0.13 0.25 0.51 0.97Kuusilampi 114.9 0.23 0.26 0.02 0.02 0.13 0.15 0.53 0.61Kolmisoppi 74.5 0.22 0.16 0.02 0.01 0.13 0.10 0.49 0.37 Measured + Indicated 452.7 0.24 1.08 0.02 0.09 0.13 0.61 0.52 2.34 Inferred 116.6 0.20 0.24 0.02 0.02 0.12 0.15 0.47 0.55Kuusilampi 75.3 0.20 0.15 0.02 0.01 0.13 0.09 0.47 0.36Kolmisoppi 41.3 0.20 0.08 0.02 0.01 0.12 0.05 0.47 0.19 Total 569.4 0.23 1.32 0.02 0.11 0.13 0.76 0.51 2.89 Table 3: Kuusilampi and Kolmisoppi Resources as published in the TalvivaaraMining Company Prospectus dated 30 May 2007 (at 0.15% nickel cut-off). Tonnage Grade / Product Mineral Resource (Mt) (Ni %) (Mt Ni) (Co %) (Mt Co) (Cu %) (Mt Cu) (Zn %) (Mt Zn) Measured 124,0 0.27 0.33 0.02 0.02 0.15 0.19 0.55 0.68Kuusilampi 81.3 0.27 0.22 0.02 0.02 0.15 0.12 0.55 0.45Kolmisoppi 42.7 0.28 0.12 0.02 0.01 0.15 0.06 0.56 0.24 Indicated 142.3 0.27 0.38 0.02 0.03 0.14 0.20 0.55 0.78Kuusilampi 97.0 0.27 0.26 0.02 0.02 0.14 0.14 0.55 0.53Kolmisoppi 45.3 0.26 0.12 0.02 0.01 0.14 0.06 0.54 0.24 Measured + Indicated 266.3 0.27 0.72 0.02 0.05 0.15 0.39 0.55 1.46 Inferred 70.8 0.24 0.17 0.02 0.01 0.13 0.09 0.49 0.35Kuusilampi 47.4 0.24 0.11 0.02 0.01 0.13 0.06 0.50 0.24Kolmisoppi 23.4 0.23 0.05 0.02 0.00 0.13 0.03 0.48 0.11 Total 337.1 0.26 0.89 0.02 0.07 0.14 0.48 0.54 1.81 The information released referring to the Mineral Resources and Explorationresults have been audited by SRK Consulting UK Ltd. The Competent Person, asdefined by the JORC Code, responsible for auditing the Mineral Resource estimateis Dr. Mike Armitage. For further enquires and additional information regardingcompiled details and figures please contact: SRK Consulting UK Ltd. Tel + 44 (029) 2034 8150 ENQUIRIES Talvivaara Mining Company Ltd Tel: +358 20 7129 800Pekka PeraSaila Miettinen-Lahde Tel: +358 40 548 3695 Merlin Tel: +44 207 653 6620David SimonsonTom RandellAnca Spiridon NOTES TO EDITORS Company Overview • Talvivaara aims to become an internationally significant base metals producer with its primary focus on nickel and zinc using a technology known as bioheapleaching to extract metal out of low grade ore • The Company's main activity is the development and exploitation of two polymetallic deposits, Kuusilampi and Kolmisoppi, in Sotkamo, Finland (together, the "Talvivaara deposits") using bioheapleaching technology (the "Talvivaara Project") - The Talvivaara deposits comprise one of the largest known sulphide nickel resources in Europe - Production is expected to start in late 2008, with an expected annual nickel output of approximately 33,000 tonnes; the Company has the potential to provide approximately 2.3% of the world's current annual production of nickel by 2010 (based on previous resource estimates) - As by-products of the process, the mine is also expected to produce zinc (approximately 60,000 tpa), copper (approximately 10,000 tpa) and cobalt (approximately 1,200 tpa) - The mine site is situated close to existing energy and transportation infrastructure • The Group plans to develop the Talvivaara deposits using bioheapleaching technology - Bioheapleaching harnesses locally occurring, live bacteria for the extraction of metals from ore - This technology is already widely used for other metals, notably copper and gold - During the last two years, the Group has demonstrated the viability of using bioheapleaching technology for the extraction of nickel in large on-site pilot trials • The Talvivaara orebody is well-suited for open pit mining due to the thin overburden, favourable resource geometry and a low waste to ore ratio • The ore is well-suited to bioheapleaching due to both its high sulphide content and its low pH, which enables rapid leaching with reduced need for chemical catalysis • The Company has secured a 10-year off-take agreement for 100 per cent of its main output of nickel and cobalt to Norilsk Nickel • With good infrastructure, progressive mining laws and economically and politically stable operating environment and readily available mining expertise, Finland provides a favourable environment for operating a mine This announcement includes statements that are, or may be deemed to be,"forward-looking statements". These forward-looking statements can be identifiedby the use of forward-looking terminology, including the terms "believes","estimates", "plans", "projects", "anticipates", "expects", "intends", "may","will", or "should" or, in each case, their negative or other variations orcomparable terminology, or by discussions of strategy, plans, objectives, goals,future events or intentions. These forward-looking statements include allmatters that are not historical facts. They include, but are not limited to,statements regarding the Group's intentions, beliefs or current expectationsconcerning, amongst other things, the results of operations, financial position,liquidity, prospects, growth, strategies and the mining industry. By their nature, forward-looking statements involve risk and uncertainty becausethey relate to future events and circumstances. Forward-looking statements arenot guarantees of future performance and the actual results of the Group'soperations, financial position and liquidity, and the development of the marketsand the industry in which the Group operates, may differ materially from thosedescribed in, or suggested by, the forward-looking statements contained in thisannouncement. A number of factors could cause results and developments to differmaterially from those expressed or implied by the forward-looking statements,including, without limitation, expectations regarding the commencement ofcommercial mining operations at the Talvivaara Project area, expectationsregarding the Group's planned capital expenditure and financial commitments, theGroup's ability to finance the planned Talvivaara Project and manageexpenditure, expectations regarding the Group's ability to generate revenue,expectations regarding the use of the bioheapleaching and metal recoverytechnology in large-scale production, general economic and business conditions,industry trends and competition, expectations regarding commodity prices,changes in regulation, and fluctuations in interest and exchange rates. TheCompany does not intend and does not assume any obligation to update anyforward-looking statements contained herein unless required by applicablelegislation. As a result of these factors, prospective investors are cautionednot to rely on any forward-looking statement. This information is provided by RNS The company news service from the London Stock Exchange