NICKEL DEVELOPMENT: Final piece of funding falls into place for Ambatovy project

MADAGASCAR — Toronto-based Sherritt International and its partners in the Ambatovy laterite project, Sumitomo (27.5%), Korea Resources (27.5%) and SNC-Lavalin (5%), have reached an agreement to fund Sherritt's remaining share of the project. The agreement will not affect the original US$2.1 billion senior project financing.

The other partners have agreed to provide support to Sherritt whereby Sherritt will not be required to directly contribute any new shareholder funding to the project and will remain as its operator. Sherritt may now fund its 40% pro rata share of funding obligations with new, non-recourse loans provided by the other Ambatovy partners.

The Ambatovy property lies 80 km east of the Madagascan capital, Antananarivo. Project construction is about 50% complete on an open pit mine, ore preparation plant and concentrate slurry pipeline to the Indian Ocean. Start up is planned for the latter part of 2010, and yearly output at full production will of 60,000 tonnes of nickel, 5,600 tonnes of cobalt and 190,000 tonnes of ammonium sulphate. Ambatovy will then be the world's largest laterite mine.

A wealth of information about the project and Madagascar is available at www.Sherritt.mg.