First Quantum Minerals Ltd said nickel production is set to resume by the end of 2011 from Australia's Ravensthorpe mine following a two year redevelopment programme.

First Quantum said in a statement emailed to Reuters that “The project is progressing to plan and we plan on producing by the end of the year.”

Annual average production for the first five years is expected to be 39,000 tonnes.

At that rate, First Quantum would become Australia's no. 2 producer behind BHP Billiton, which operates mines, a refinery and a smelter in Western Australia. Currently, Minara Resources is Australia's second largest nickel producer, targeting production of between 29,000 and 32,000 tonnes in 2011.

BHP shut down Ravensthorpe in 2009 after nickel prices dropped to less than half as the global financial crisis crippled commodities demand. Ravensthorpe was designed by BHP to supply around 55,000 tonnes of nickel annually but never came near that rate before closing. First Quantum bought the operation from BHP Billiton in February last year for AUD 340 million.

(Sourced from Reuters)