ONTARIO - SCOTT WILSON RPA has completed the feasibility study of the Premier Ridge nickel property 13.5 km east of XSTRATA NICKELs Strathcona mill complex. FIRST NICKEL of Toronto is earning 100% interest in the Premier Ridge property.
The study was based on an indicated resource of 1.44 million tonnes grading 1.42% Ni and 0.54% Cu at a 1.0% nickel equivalent cutoff grade. Conversion of the resources to reserves yielded a probable reserve of 1.15 million tonnes grading 1.33% Ni and 0.53% Cu.
The project has an IRR of 37.1% and would generate an undiscounted pre-tax cash flow of $27.8 million after capital recovery, assuming average metal prices of US$7.62/lb Ni, US$2.19/lb Cu and US$9.00/lb Co over a five-year mine life. Based on a 10% discount rate the project has a $14.3 million NPV. The pre-production and sustaining capital requirements have been estimated at $42.8 million and $4.2 million respectively. Unit cash operating costs net of by-product credits are estimated at US$5.49/lb Ni.
First Nickel says that mining of development ore is scheduled for March of 2008, and yearly output will average 230,000 tonnes of ore. The deposit is relatively flat-lying and amenable to room and pillar, blasthole (longhole), and ramp pillar recovery methods.
At First Nickels Lockerby mine, the access to the western portion of the 65 level has been completed and will provide development ore from the area. The company says the mine is generating a cash flow and that expansion will continue. Additional information is available at www.FirstNickel.com.