Scandinavian Minerals Limited

Scandinavian Minerals Limited

April 17, 2007 08:00 ET

Scandinavian Minerals Commences Bankable Feasibility Study for Kevitsa Nickel-Copper-PGE Property

TORONTO, ONTARIO--(CCNMatthews - April 17, 2007) - Scandinavian Minerals Limited (TSX:SGL) today announced that it has commenced the Bankable Feasibility Study for its 100%-owned Kevitsa nickel-copper-PGE property, located in Finland. This follows the positive Pre-Feasibility Study released last July (see Press Release dated July 18, 2006) and the recent completion of infill drilling and environmental work.

The Feasibility Study will be coordinated by St Barbara LLP (formerly St Barbara Consultancy Services) of London, UK. St Barbara will also be responsible for ensuring that the Study complies with Canadian National Instrument 43-101. Technical work, including geology, mining, metallurgy and environmental studies, will be performed by leading Finnish engineering and technical consultants. The Study is expected to take approximately 12 months to complete.

Mr. Peter Walker, President & CEO of Scandinavian Minerals, commented "The start of the Bankable Feasibility Study represents a major milestone in advancing Kevitsa towards production. We have put together an excellent technical team in Finland with many years experience in mine construction and operation. This familiarity with local conditions will be invaluable in ensuring the successful development of one of the world's largest un-mined nickel sulphide orebodies."

The commencement of the Bankable Feasibility Study follows a number of major steps forward for the Kevitsa project in recent months:

- Positive Pre-Feasibility Study completed (July, 2006)

- Environmental Impact Assessment submitted (September, 2006)

- Mining Permit Application submitted (December, 2006)

- Infill Drilling results received (March, 2007)

In addition, the Company expects to complete the ongoing Pilot Plant metallurgical program at the end of this month, the results of which will be included in the Bankable Feasibility Study. The Company also plans to submit the Environmental Permit Application to the Finnish authorities within the next few weeks.

Detailed planning is continuing for the project infrastructure, including the upgrading of the present forest road, which connects Kevitsa to the main north-south highway in Northern Finland, located 7 km to the west of the property. Planning is also under way for the power and water supply to the project. Power will be sourced from the existing 21 MW Kitinen River hydroelectric plant, 6 km west of Kevitsa, which is integrated into the Finnish National Grid. The water supply will also be drawn from the Kitinen River.

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, with a measured and indicated resource of 141 million tons and an inferred resource of 291 million tons (both at 0.2% Ni cutoff). This equates to contained metal of 930 million pounds nickel and 1.3 billion pounds copper (measured + indicated), and 1.9 billion pounds nickel and 2.9 billion pounds copper (inferred). The Kevitsa deposit is easily accessible by road.

On 18 July 2006, Scandinavian Minerals announced the results of a positive pre-feasibility study for the Kevitsa project (filed on SEDAR July 17, 2006). The pre-feasibility study, which was also undertaken by St Barbara, was based on an initial open pit mining operation producing 4.5 million tons of ore per year, with production of separate nickel and copper concentrates for sale to smelters in Finland or abroad. The study assumes contract mining, which is standard practice in Finland. Proven and probable reserves in the proposed open pit total 66.8 million tons to 400 metres depth, giving a mine life of 15 years at an average strip ratio of 2.34. The study shows attractive economics at conservative long-term metal prices.

Pre-Feasibility Study: Open Pit Mineral Reserve to 400 metres
% grams/tonne
Ni Cut- tonnes ----------------------------------------------
off (%) Ni Cu Co Au Pd Pt
Proven 0.18% 56.2 Mt 0.295 0.415 0.014 0.141 0.201 0.310
Probable 0.18% 10.6 Mt 0.295 0.492 0.015 0.142 0.171 0.267
Total 0.18% 66.8 Mt 0.295 0.427 0.014 0.141 0.196 0.303

The results from the recently completed infill drilling program are not
included in the above reserve estimate.

The Pre-Feasibility Study envisages average annual production in
concentrate as follows:

Nickel 19 million pounds (8,692 tons)
Copper 31 million pounds (14,227 tons)
Cobalt 906,000 pounds (411 tons)
Platinum 15,542 ounces
Palladium 9,474 ounces
Gold 7,916 ounces

About Scandinavian Minerals

Scandinavian Minerals Limited is a Canadian company focused on mineral development and exploration in Scandinavia and Finland. The Company is currently developing its 100%-owned Kevitsa nickel-copper-PGE project in Finland, one of the largest undeveloped nickel sulphide deposits in the world. Scandinavian Minerals believes that the Nordic region offers excellent potential for large-scale discoveries in under-explored terrain, combined with favourable mining laws, clear security of title, extensive mining experience and long-established political and economic stability.

At February 28, 2007 the Company held cash of approximately $14 million and has 17.8 million outstanding common shares which trade on the Toronto Stock Exchange under the symbol SGL.

Contact Information

  • Scandinavian Minerals Limited
    Peter Walker
    President & CEO
    Scandinavian Minerals Limited
    John Kearney
    (416) 203-6128
    (416) 368-5344 (FAX)
    Studer Consulting AG
    Marlies Studer
    (+41) 44 215 2803