Talvivaara Mining Company Quarterly interim results for January to March 2010
Talvivaara Mining Company Plc announced its unaudited interim results for the three months ended March 31st 2010.
Highlights
1. Zinc streaming agreement with Nyrstar NV for 1.25 million tonnes of zinc in concentrate was completed on 11 February 2010; pre-payment of USD 335 million received from Nyrstar
2. Project Term Loan Facility of USD 320 million was fully repaid on February 11th 2010 using the proceeds of the zinc streaming agreement
3. All nickel, zinc and foreign exchange risk hedging positions associated with the Project Term Loan Facility were closed for net proceeds of EUR 46 million
4. Ramp-up of production suffered from a 3.5 week production stoppage in February caused by a hydrogen plant failure, and from hydrogen sulphide odour problems in March forcing the Company to curtail production until additional gas scrubbing capacity was installed
5. Payable nickel and zinc production during the period amounted to 610 tonnes and 2,960 tonnes, respectively; zinc production came close to the budgeted level despite the ramp-up issues described above
6. Talvivaara announced plans to recover uranium as a by-product with anticipated future production amounting to approximately 350 tonnes per annum
Mr Pekka Perä CEO of Talvivaara said that "Our production volumes during the early part of this year reflected a series of teething problems at the metals recovery plant. Frustratingly, one of the main issues was the odour of hydrogen sulphide which, when it spread to the nearby communities, forced us to curtail production at an otherwise functioning plant. This odour problem is being attended to by increasing the gas scrubbing capacity and overall I am very encouraged by the continued improvement in all our production processes. In particular, our crushing volumes have shown steady progress towards the levels required to reach our long term goals, and bioheapleaching similarly continues to produce higher grade solutions thereby contributing our advancing ramp up. Although the ramp up challenges we have had to overcome over the last few months forced us to revise our production target for the current year, we remain confident of being on track to reaching our full scale target of approximately 50,000 tonnes of nickel in 2012. Recent progress in production leads us to believe that the shortfall in nickel tonnes for this year is simply being pushed to 2011. As a demonstration of our advancing ramp-up I am also pleased to note that our net sales in the first quarter of 2010 were more than our historical sales combined, and the sales generated after the reporting period in April were again more than those seen in the first quarter."
