TALV.L Regulatory News (TALV)

13 Jun 2007 07:01

Talvivaara Mining Company Ltd13 June 2007 The information contained herein is restricted and is not for publication,release or distribution, directly or indirectly, in or into the United States,Australia, Canada or Japan or to residents or citizens of Australia, Canada orJapan. Talvivaara's Board approves investment plan for the Talvivaara project development 13 June 2007 Talvivaara Mining Company Ltd ("Talvivaara" or "the Company"), the Finnishmining company with a primary focus on nickel and zinc, is pleased to announcethat following the successful listing of Talvivaara on the Main Market of theLondon Stock Exchange on 1 June 2007 and the offering of shares to institutionalinvestors (the "IPO"), the Board of the Company approved on 8 June theinvestment plan for the development of the Talvivaara mine (the "TalvivaaraProject"). The Company has now completed the expected financing for the Talvivaara Project(collectively consisting of a $320 million project finance facility and the£181.9 million net proceeds from the IPO). The investment plan provides theframework for the deployment of this capital and will enable the Company tocontinue the construction of general mine site infrastructure, preparation ofthe site for production and acquisition and installation of necessary equipment.The Company estimates that the capital expenditure programme for the years2007-2009 will amount to approximately €450 million. At IPO the market capitalisation of Talvivaara was approximately £557 million.JPMorgan Cazenove Limited was Sponsor, Sole Global Co-ordinator and Bookrunner.Nordea Bank Plc was Co-lead Manager. The IPO followed the arrangement of the$320 million project finance facility secured by the Company only five monthsafter completion of a bankable feasibility study (which contained detailedestimates of all material capital and operating expenditures expected to beincurred in connection with constructing and operating the project). The projectfinance facility was structured by Standard Bank Plc with Standard Bank Plc,Societe Generale, HVB and Nordea Bank Plc as mandated lead arrangers. Commenting on the Board's decision, Pekka Pera, Chief Executive Officer of theCompany said: "I am pleased with the strong support we received during the recent IPO.Following approval of the investment plan, we shall be working hard to executeour plans and continue full scale development of this exciting project". ENQUIRIES Talvivaara Mining Company Ltd Tel: +358 20 7129 800Pekka Pera Tel: +358 40 585 9225Saila Miettinen-Lahde Tel: +358 40 548 3695 Merlin Tel: +44 207 653 6620David SimonsonTom RandellMaria Suleymanova NOTES TO EDITORS Company Overview • Talvivaara and its subsidiary Talvivaara Project Ltd 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 with 266 million tonnes of ore in measured and indicated resources > Resources are sufficient to support anticipated production for a minimum of 24 years, 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 > In addition to the mining of nickel, 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 the 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 has a nickel content of 0.27 per cent. and 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 product output of nickel and cobalt to Norilsk Nickel • With good infrastructure, progressive mining laws, subsidy policies and economically and politically stable operating environment and readily available mining expertise, Finland provides a favourable environment for operating a mine This announcement may not be distributed, directly or indirectly, in or into theUnited States, Canada, Australia or Japan. This announcement does not constituteor form part of an offer to sell or issue, or any solicitation of an offer tobuy or subscribe for, any securities referred to herein in the United States orany other jurisdiction. The securities mentioned herein have not been registeredunder the U.S. Securities Act of 1933 as amended (the "Securities Act"), and maynot be offered or sold in the United States (as such term is defined inRegulation S under the Securities Act) unless they are registered under theSecurities Act or pursuant to an exemption from the registration requirements ofthe Securities Act. This information is provided by RNS The company news service from the London Stock Exchange