Scandinavian Minerals Limited

Scandinavian Minerals Limited

September 06, 2005 09:56 ET

Scandinavian Gold Limited: Confirmation Of Metallurgical Breakthrough At Keivitsa Nickel-Copper-PGE Property

TORONTO, ONTARIO--(CCNMatthews - Sept. 6, 2005) - Scandinavian Gold Limited (TSX:SGL) -

- Mini-pilot tests confirm that smelter-grade concentrates can be produced

- New pre-feasibility study planned

Scandinavian Gold Limited (TSX:SGL) today announced further positive results from its Keivitsa, Finland, nickel-copper-PGE property, which is 100%-owned by the Company. Mini-pilot tests have now confirmed the results of earlier bench testing to demonstrate that separate copper and nickel concentrates can be produced by flotation. Such concentrates would be suitable for sale to conventional smelters.

The best test yielded a nickel concentrate with 12% nickel at a recovery of 68% and a copper concentrate with 25% copper at a recovery of 75%. A further 3% copper reported to the nickel concentrate at 11% recovery, to bring total copper recovery to 85%. Recovery of precious metals to nickel and copper concentrates respectively was 17% and 20%. Further work is expected to bring about additional improvement in both nickel and precious metal recoveries.

"We believe these results constitute a major advance towards development of the Keivitsa project," said Peter Walker, President and CEO. "The ability to produce smelter-grade concentrates gives us the option to develop a conventional mining and processing operation, with sale of concentrates to local or overseas smelters."

The Phase 3 mini-pilot tests were undertaken at the Mineral Processing Laboratory of the Geological Survey of Finland. A total of 9 tests was run, using 980 kg of drill core. The drill core comprised the nickel-copper-PGE ore type that forms the main orebody at Keivitsa.

Given the mini-pilot results, the Company plans a new Pre-Feasibility Study based on open-pit mining of up to 4 million tons of ore per year, with production of separate nickel and copper concentrates for sale to smelters. This Study is scheduled to begin in September and to be completed by early 2006.

Management is pursuing two scenarios in parallel for the development of Keivitsa, in order to determine the best means of bringing the project into production. One is based on the production of separate nickel and copper concentrates suitable for sale to smelters, as outlined above. The other involves the treatment of a bulk concentrate by pressure acid leach. The results of pressure acid leach testing by three major companies are now expected in October 2005.

Environmental studies are continuing at Keivitsa and it is expected that the environmental permit application will be submitted in March 2006.

Keivitsa is one of the world's major undeveloped sulphide nickel deposits and one of the largest mineral discoveries in Finland's history. It hosts a probable reserve of 120 million tons grading 0.21% nickel, 0.3% copper, 0.012% cobalt and 0.52 grams/ton PGE + gold, amounting to 252,000 tons contained nickel and 360,000 tons contained copper. The probable reserve is contained within an indicated resource of 150 million tons grading 0.18% nickel, 0.27% copper, 0.011% cobalt and 0.47 grams/ton PGE + gold. An additional inferred resource of 315 million tons grades 0.18% nickel, 0.29% copper, 0.012% cobalt and 0.4 grams/ton PGE + gold.

Keivitsa is situated in Finland, a country which offers long-established political and economic stability. The Keivitsa deposit is easily accessible by road. Water and hydroelectric power are available nearby.

All metallurgical test work was conducted in Finland by GTK Mineral Processing (the Geological Survey of Finland). Mr. John Pedersen, M.Sc., P.Geo., acts as the Company's Qualified Person.

About Scandinavian Gold

Scandinavian Gold is a Canadian company exploring for precious and base metals in Scandinavia, with emphasis on Finland. The Company is currently developing one of Finland's largest mineral discoveries, the 100%-owned Keivitsa nickel-copper-PGE project. Scandinavian Gold believes that Finland offers excellent potential for large-scale discoveries in under-explored terrain, combined with a favourable, well-administered mining law, clear security of title and long-established political and economic stability. The Company's 11.3 million common shares trade on the Toronto Stock Exchange under the symbol SGL.

Contact Information