NICKEL DEVELOPMENT – Falconbridge shoulders Koniambo cost

NEW CALEDONIA - Toronto's FALCONBRIDGE has agreed to finance up to 100% of the Koniambo ferronickel project in the Northern Province. The project is a joint venture of Falconbridge (49%) and Societe Miniere du Sud Pacifique (SMSP). The development cost of US$2.2 billion (in 2004 dollars) excludes working capital and interest during construction.

The Koniambo project contains measured plus indicated resources totalling 142.1 million tonnes at 2.13% Ni at a cut-off grade of 1.5% Ni. Together with additional inferred resources of 156 million tonnes at 2.2% Ni, Koniambo is one of the world's largest and highest grade nickel laterite deposits. Production is planned for 2009. In addition, the project has an inferred limonite resource estimated at 100 million tonnes at 1.6% Ni and 0.2% Co that could be developed at a later date.

Meanwhile, the High Court of Justice in Paris rejected ERAMET's application questioning the legality of Falconbridge's and SMSP's ownership of the Koniambo deposit. Eramet is an integrated mining and metallurgy company based in France.

For more information on the Koniambo project, write to ProjectsEngineering@Falconbridge.com.