BASE METAL ALLIANCE NEWS Inco, LionOre Join Forces in Australia

TORONTO, Ont. INCO and LIONORE MINING INTERNATIONAL have an agreement in principle to create a strategic alliance. The pact covers "several areas of mutual interest". These areas include collaboration on LionOre's Activox hydrometallurgical process for treating sulphide ores, and joint venture exploration projects in Australia.

The agreement calls for Inco to purchase nickel concentrate from LionOre's 100%-owned Maggie Hays mine in Australia, when production begins in 2004. Concentrates will be smelted at Inco's plants in Thompson, Man., and Sudbury, Ont. Inco will also subscribe to a private placement of LionOre shares. The proceeds will be used to repay a Aus$25-million loan that Inco extended to LionOre for the development of the Emily Ann nickel sulphide deposit.

Learn more about the Activox process at LionOre's web site, www.lionore.com.