Xstrata Nickel

Xstrata Nickel

January 09, 2008 16:00 ET

Xstrata Nickel Completes Nickel Rim South's Main Shaft Without Lost Time Injury

SUDBURY, ONTARIO--(Marketwire - Jan. 9, 2008) - Xstrata Nickel today announced the completion of the Main Production Shaft at its Nickel Rim South Project, which reached bottom at a depth of 1,735 metres on December 20, 2007, and was sunk without a lost time injury over the course of 30 months and 540,000 effort hours. This follows the completion of the Vent Shaft in May 2007, which achieved the same safety record, for a combined 3.7 years, or 926,000 effort hours, without a lost time injury.

"This is a remarkable accomplishment as health and safety performance exceeded shaft sinking targets and industry benchmarks, demonstrating that safety and productivity go hand-in-hand," said Ian Pearce, CEO of Xstrata Nickel. "We congratulate our dedicated project team at Nickel Rim South on this significant achievement and for leading Xstrata Nickel's 'Zero Harm' philosophy."

The project team, in conjunction with our shaft sinking partner, Cementation Canada Inc., sank the two shafts with productivities consistently ahead of plan and within budget. Nickel Rim South required two shafts; one for production purposes, the other for ventilation and a second egress. Shaft sinking commenced in the Ventilation Shaft in February 2005 with the Production Shaft following four months later.

The completion of the Main Shaft is also a critical milestone in the development of Nickel Rim South, keeping the project on schedule to ramp up to 60% of its ultimate 1.25 million tonne per annum production capacity in 2009. Nickel Rim South is expected to provide a high value ore feed for more than 15 years, while significantly reducing Sudbury's unit costs, and plays a key role in transforming Xstrata Nickel's Sudbury operations from closure to growth mode.

About Nickel Rim South

Discovered in 2001, Nickel Rim South promises to be one of the lowest cost mines in the history of Xstrata Nickel's Sudbury operations. The project is located nine kilometres north of the Sudbury smelter. Nickel Rim South is a high grade mineral resource located between 1,100 metres and 1,700 metres depth with 14.5 million tonnes inferred resource grading 1.6% nickel, 3.1% copper, 0.03% cobalt, 1.7 g/t platinum, 1.9 g/t palladium, 14 g/t silver and 0.7 g/t gold. A five-year, Cdn$627 million deposit definition program began in the first quarter of 2004. A comprehensive Environmental Management System provides for responsible stewardship of the site and its surrounding environment. Infrastructure at the site is being constructed to achieve production of 1.25 million tonnes per year of ore. With production scheduled to commence in 2009, Nickel Rim South will extend Xstrata Nickel's presence in the Sudbury Basin for at least 15 years.

About Xstrata Nickel

Xstrata Nickel, headquartered in Toronto, Canada, is one of Xstrata Group's global commodity businesses, comprising five mines and processing facilities in Ontario and Quebec, Canada; a ferronickel mine and processing facility in Bonao, Dominican Republic; and a refinery in Kristiansand, Norway. Xstrata Nickel has a significant portfolio of growth projects, including Koniambo in New Caledonia, Nickel Rim South in Canada, Kabanga in Tanzania and Araguaia in Brazil. Xstrata Nickel is the world's fourth largest nickel producer, with annual managed production of more than 110,000 tonnes of refined nickel.

About Xstrata plc

Xstrata is a global diversified mining group, listed on the London and Swiss Stock Exchanges, with its headquarters in Zug, Switzerland. Xstrata's businesses maintain a meaningful position in seven major international commodity markets: copper, coking coal, thermal coal, ferrochrome, nickel, vanadium and zinc, with additional exposures to platinum group metals, gold, cobalt, lead and silver, recycling facilities and a suite of global technology products, many of which are industry leaders. The Group's operations and projects span 18 countries: Argentina, Australia, Brazil, Canada, Chile, Colombia, the Dominican Republic, Germany, New Caledonia, Norway, Papua New Guinea, Peru, the Philippines, South Africa, Spain, Tanzania, the USA and the UK. Xstrata employs approximately 50,000 people, including contractors.

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