NORANDA INCOME FUND
TSX : NIF.UN

NORANDA INCOME FUND

February 23, 2009 08:41 ET

Noranda Income Fund to Reduce Sulphuric Acid and Zinc Production by 20% for the Month of March in Response to Continued Weakness in the Sulphuric Acid Market

VALLEYFIELD, QUEBEC--(Marketwire - Feb. 23, 2009) - The Noranda Income Fund (the "Fund") (TSX:NIF.UN) has received notice from its sales agent, Xstrata Canada Corporation ("Xstrata Canada"), that it is unable to arrange for sales and/or temporary storage for sulphuric acid in quantities equal to the current rate of production. As a result, March production of sulphuric acid and zinc will be reduced by approximately 20%, or 4,800 tonnes of zinc and 8,000 tonnes of sulphuric acid since the Fund's sulphuric acid storage capacity is nearly full.

The current economic conditions are very challenging, and the traditional purchasers of the Fund's sulphuric acid have restricted their purchases because of cutbacks in their order books. The reduction in production will negatively impact the Fund's profitability. The Fund is unable to predict with any certainty the expected duration of weak demand for sulphuric acid.

The independent Trustees of the Fund are reviewing the notice, as is the Fund's practice with all non-arm's length transactions, to ensure that the Fund is being treated fairly by its sales agent, Xstrata Canada.

Noranda Income Fund is an income trust whose units trade on the Toronto Stock Exchange under the symbol "NIF.UN". The Noranda Income Fund owns the CEZinc processing facility and ancillary assets (the "CEZinc processing facility") located in Salaberry-de-Valleyfield, Quebec. The CEZinc processing facility is the second-largest zinc processing facility in North America and the largest zinc processing facility in eastern North America, where the majority of its customers are located. It produces refined zinc metal and various by-products from zinc concentrates purchased from mining operations. The Processing Facility is operated and managed by Canadian Electrolytic Zinc Limited.

Further information about the Noranda Income Fund can be found at www.norandaincomefund.com.

Contact Information

  • Financial information: Michael Boone
    Vice President & Chief Financial Officer of Canadian
    Electrolytic Zinc Limited, Noranda Income Fund's Manager
    (416) 775-1561
    Email: mboone@xstrata.ca
    Website: www.norandaincomefund.com