Kabanga! Kabanga! when?Xstrata Nickel Commits US$95 Million, Updates Resource Estimate and Commences Pre-Feasibility Study at Kabanga Joint Venture Nickel Project, Tanzania
TORONTO, ONTARIO -- (MARKET WIRE) -- February 15, 2007 -- Xstrata Nickel announces further investment of US$95 million and the commencement of a pre-feasibility study to advance the Kabanga nickel project located in western Tanzania.
An update to the preliminary resource estimate has also been announced for the project, a 50/50 owned joint venture of Barrick Gold Corporation and Xstrata Nickel, operated by Xstrata through a subsidiary. This confirms the Kabanga nickel project as among the world's most attractive undeveloped nickel sulphide deposits, with a total estimated indicated resource of 9.7 million tonnes grading 2.37% nickel and a total estimated inferred resource of 36.3 million tonnes grading 2.8% nickel. The revised estimate represents a notable increase from the project's previous estimate (inferred) of 26.4 million tonnes at 2.6% nickel.
Xstrata Nickel has completed over US$50 million in expenditures to update the resource model for the Kabanga project and preparation of an extensive scoping study.
"We are very pleased with the progress occurring at Kabanga, which is among the world's most attractive nickel projects," said Ian Pearce, Chief Executive Officer of Xstrata Nickel. "We anticipated good results from our resource estimate update and we received them. We have taken the logical next step of moving this project to the pre-feasibility stage and we look forward to the continued development of Kabanga."
"Kabanga has the potential to become a world class nickel sulphide deposit. The most recent resource has a compelling combination of size with high grades," said Greg Wilkins, Barrick President and Chief Executive Officer.
Diamond drilling is ongoing with ten drills with the objectives to:
- Continue to upgrade the resource to measured and indicated categories in North Zone to provide sufficient quality data to support a feasibility study on the project.
- Further expand and upgrade the inferred resource at Tembo Zone, a new zone discovered in June 2006 located 2 km north along strike of North Zone.
- Progress the systematic exploration of the under-explored Kabanga licences and evaluate select regional targets for new discoveries in the proximity of the Kabanga deposits
- Undertake geotechnical investigations for potential infrastructure sites.
The most recent (December, 2006) Kabanga Nickel Project resource estimate is as follows:
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Category Tonnes Ni Cu Co Au Pt Pd Ag
% % % gpt gpt gpt gpt
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Main Indicated 2,420,000 1.68 0.25 0.13 0.02 0.04 0.07 0.31
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North Indicated 7,280,000 2.59 0.35 0.21 0.04 0.08 0.09 1.28
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Total Indicated 9,700,000 2.37 0.32 0.19 0.04 0.07 0.09 1.04
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North Inferred 26,300,000 3.0 0.4 0.2 0.1 0.4 0.3 1.6
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Tembo Inferred 9,300,000 2.4 0.3 0.2 0.1 0.2 0.2 1.2
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MNB Inferred 700,000 1.5 0.2 0.1 0.1 0.1 0.1 0.7
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Total Inferred 36,300,000 2.8 0.4 0.2 0.1 0.3 0.3 1.5
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The extensive exploration program on these promising properties is being conducted by the Companies with Xstrata Nickel acting as the operator.
The Main Zone resource is based on 54 diamond drill holes, totaling 18,508 metres, with spacing between pierce points ranging from 30 to 50 metres. The North Zone is based on 167 diamond drill holes, totaling 114,864 metres with pierce point spacing ranging from 20 to 50 metres for the Indicated estimate and 50 to 150 metres for the Inferred estimate. The Tembo Zone resource is based on 40 diamond drill holes, totaling 19,628 metres, with pierce point spacing averaging 100 metres. The MNB zone is based on 6 diamond drill holes, totaling 4,298 metres, with hole spacing ranging from 50 to 100 metres