Sydney - Tuesday - May 29: (RWE Aust Business News) - The Sally Malay nickel project of a preliminary forecast is 7,500-8,000t Ni contained (target 8,000t Ni) in 2007/08 based on treating about 700,000t ore at 1.2-1.3% Ni at 87-88% metallurgical recovery. This is 10 per cent below the company's previously advised target of 8,600t Ni contained and is primarily due to a combination of the following factors: * Significant production coming from a lower grade portion of the orebody; * The new paste plant not due to be commissioned until late Q4 2007; and * higher grade stopes not accessible in 2007/08 due to paste filling schedule. Directors say it should also be noted that every effort will be made to increase nickel production in 2007/08 to take advantage of the current high prices. Nickel tonnes per vertical metre increases with depth at Sally Malay; and * Mining with paste fill will allow 100% ore extraction and is anticipated to add over 600,000 tonnes of ore and 12 months additional mine life to the Project. The preliminary forecast for the Lanfranchi Project is 8,000t nickel contained in 2007/08 based on mining and trucking about 300,000t ore at 2.65% Ni. The preliminary forecast is lower than our previously advised target due to first ore from Winner now scheduled for October 2007 (previously August 2007); and ramp up to full production at Deacon will take longer that anticipated due to the additional development time required to setup the proposed longhole stope mining method.
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