Scandinavian Minerals Limited

Scandinavian Minerals Limited

January 15, 2008 08:00 ET

Scandinavian Minerals Reports First Quarter Results

TORONTO, ONTARIO--(Marketwire - Jan. 15, 2008) - Scandinavian Minerals Limited (TSX:SGL) today reported that it has filed its unaudited Financial Statements and Management's Discussion and Analysis for the three months ended November 30, 2007.

The Company reported a consolidated net loss for the quarter ended November 30, 2007 of $15,792 compared to a loss of $497,096 for the same period in 2006. The reduced loss is due principally to higher interest income, partly offset by higher administrative expenses as a result of increased corporate activity.

During the quarter the Company's focus was the continued development of its 100%-owned Kevitsa nickel-copper-PGE (platinum group elements) project in northern Finland. Subsequent to November 30, the Company also completed a non-brokered private placement with a group of leading Finnish investment institutions. This placement consisted of the issue of 5 million common shares in the Company at a price of $8.00 per share for gross proceeds of $40 million. Lead investors were Finnish Industry Investment Ltd. and Etera Mutual Pension Insurance Company.

As a result of this placement, the Company's cash position was approximately $76.9 million as at December 31, 2007. This healthy cash position will enable the Company to continue to advance the Kevitsa project in order to meet its target of a 2010 start-up.

Highlights of the quarter

- Order placed for grinding mills

- Multi-purpose drill program commenced

- Further senior technical appointments made to project management team

- Tenders invited for road and bridge construction

- Private Placement for gross proceeds of $40 million.

In October, 2007 the Company placed an order with Outotec Oyj, Finland for the grinding mills for the Kevitsa project. The mills are expected to be delivered in the first quarter of calendar 2010. The grinding mills are being designed to process approximately 5 million tons of ore per year and will be fully autogenous. The value of the order is in excess of EUR 20 million (Euro).

During the quarter a further drill program was commenced at Kevitsa. This program is intended to investigate the potential for upgrading inferred resources and obtain better data for pit modelling. The drilling will also collect additional geotechnical data for open pit design. The program is expected to be completed at the end of March, 2008. The results from this drilling will be incorporated into the ongoing Feasibility Study.

The Company also continued with its recruitment of senior technical staff for Kevitsa, including the Mine Superintendent as well as a Senior Technical Engineer to supervise plant design and construction. The successful recruitment of such experienced individuals is a crucial element in the development of the project.

During the quarter the Company invited tenders for construction of a 6 kilometre road to the property to replace the currently used gravel road, as well as for construction of a new larger bridge over the Kitinen river, to link with the main highway.

The Company has applied for both the mining concession and the environmental permit necessary for mining at Kevitsa. The mining concession permit is expected to be received in the second quarter of calendar 2008 and the environmental permit in the following quarter.

The Kevitsa project - an overview

Kevitsa, situated in northern Finland, is one of the world's major undeveloped sulphide nickel deposits and one of the largest mineral discoveries in Finland's history. The Kevitsa deposit is easily accessible by road. Water and hydroelectric power are available nearby.

In April 2007 Scandinavian Minerals commenced the Feasibility Study for the Kevitsa project. The Study is being coordinated by St Barbara LLP (formerly St Barbara Consultancy Services) of London, UK. The metallurgical process has been developed by the Mineral Processing Laboratory of the Geological Survey of Finland. Plant engineering and design is being performed by Outotec Oyj. The Feasibility Study is expected to be completed in the second quarter of calendar 2008.

About Scandinavian Minerals

Scandinavian Minerals Limited is a Canadian public company listed on the Toronto Stock Exchange under the symbol "SGL" and on the Frankfurt Freiverkehr market under the symbol W3M. The Company's current focus is the development of its 100%-owned Kevitsa nickel-copper-PGE project in northern Finland.

Forward-Looking Statements

Some of the statements contained herein may be forward-looking statements which involve known and unknown risks and uncertainties. Without limitation, statements regarding potential mineralization and resources, exploration results, and future plans and objectives of the Company are forward looking statements that involve various degrees of risk. The following are important factors that could cause the Company's actual results to differ materially from those expressed or implied by such forward looking statements: changes in the world wide price of mineral commodities, general market conditions, risks inherent in mineral exploration, risks associated with development, construction and mining operations, the uncertainty of future profitability and the uncertainty of access to additional capital.

Contact Information

  • Scandinavian Minerals Limited
    John Kearney
    (416) 203-6128
    Scandinavian Minerals Limited
    Peter Walker
    President & CEO
    (+44) 7717-223909
    Scandinavian Minerals Limited
    Chris de Saint-Rome
    Corporate Development Advisor
    (514) 802-3377
    Studer Consulting AG
    Marlies Studer
    (+41) 44 215 2803