Mirabela Nickel Limited has announced its unaudited second quarter results for the period ended June 30th 2011.
Highlights:
Production of 3,395 tonnes of nickel in concentrate for the quarter (up 20% from Q1 2011 of 2,825 tonnes)
Sales of 3,909 tonnes of nickel in concentrate for the quarter (up 88% from Q1 2011 of 2,084 tonnes)
Completion of mining pre strip during May, full strike length of the pit is now open
Average nickel recovery of 56% for the quarter (Q1 2011 of 55%) with 60% average achieved in June
Record total mining material movement (3.6 million tonnes) and ore production (455,000 tonnes) achieved in June
Unit cash costs of USD 7.85 per pound for the quarter (up 13% from Q1 2011: USD 6.97 per pound) predominantly impacted by the timing of smelter charges and a stronger Real/USD exchange rate
Processing plant upgrade to 7.2 million tonnes per annum currently ahead of schedule with full capacity now expected during Q4 2011 (previously end of 2011)
Pre feasibility study commenced for 9 million tonnes per annum open pit and plant expansion
Ramp up of the Santa Rita operation continued during the second quarter of 2011. The primary focus for 2011 is the completion of the open pit pre strip, which has now been achieved, and the upgrade of the processing plant to 7.2 million tonnes per annum, which is currently ahead of schedule.
Mirabela is targeting between 15,500 and 16,500 tonnes of nickel in concentrate for 2011. The lower end of the range is due to lower nickel grades at the top of the central zone ore contact, with the upper end of the range possible due to the accelerated plant upgrade schedule.
Since commencing operations, Santa Rita's strong commitment to safety has continued. Two LTI's occurred during the quarter. The 12 month moving average Lost Time Injury Frequency Rate was 0.85 at the end of the second quarter. The implementation of safety training and safety improvement programs is continuing.
Production Statistics
| Mining | Q2 '11 | Q1 '11 | Change | YTD '11 |
| Total material mined | 9,119,831 | 9,042,297 | 1% | I8,162,129 |
| Ore mined | 1,294,774 | 975,776 | 33% | 2,270,550 |
| Nickel grade | 0.48 | 0.48 | - | 0.48 |
Mined in tonnes
Grade in %
| Processing | Q2 '11 | Q1 '11 | Change | YTD '11 |
| Total ore processed | 1,294,550 | 1,070,368 | 21% | 2,364,918 |
| Nickel grade | 0.47 | 0.48 | -2% | 0.47 |
| Copper grade | 0.13 | 0.12 | 8% | 0.12 |
| Cobalt grade | 0.01 | 0.02 | -50% | 0.02 |
| Nickel recovery | 56 | 55 | 2% | 56 |
| Copper recovery | 65 | 72 | -10% | 69 |
| Cobalt recovery | 33 | 32 | 3% | 33 |
Total in tonnes
Grades in %
| Production | Q2 '11 | Q1 '11 | Change | YTD '11 |
| Nickel in concentrate produced | 3,395 | 2.825 | 20% | 6,220 |
| Copper in concentrate produced | 1,065 | 943 | 13% | 2,005 |
| Cobalt in concentrate produced | 65 | 53 | 23% | 118 |
In DMT
| Sales | Q2 '11 | Q1 '11 | Change | YTD '11 |
| Nickel in concentrate sold | 3,909 | 2,084 | 88% | 5,993 |
| Copper in concentrate sold | 1,262 | 66S | 89% | 1,930 |
| Cobalt in concentrate sold | 74 | 39 | 90% | 113 |
In DMT
Mirabela achieved another solid mining performance with 9.1 million tonnes of material movement during the second quarter of 2011. During the second quarter record ore production of 1,294,774 tonnes was mined at an average nickel grade of 0.48% and a strip ratio of 6:1.
Pre stripping of the central zone of the open pit was completed during May and the full strike length of the pit is now open. Steady ore production is now coming from all parts of the open pit with the central zone contributing approximately 30% of the ore feed for May and June. With the completion of the pre strip in May, June produced record ore production of 455,000 tonnes.
Mirabela strengthened the mining fleet during the quarter with the arrival of a CAT994 Front End Loader, four Komatsu dozers, and an Atlas Copco L8 drill rig. Equipment availability and utilization was adversely affected by limited off road tyre supply which saw up to five trucks stood down for a week during May. The situation has now been rectified with the sourcing of adequate tyres for the full fleet. Mirabela continues working with its contractors to improve the drilling performance with the performance improving during June.
During the quarter a record of 1.3 million tonnes of ore, grading at an average of 0.47% nickel was milled at an average recovery of 56%. The recovery result for the quarter is in line with the quality of ore presented to the plant. June recoveries averaged 60% with the improvement in ore feed quality and consistency. A major SAG mill reline was completed in June during scheduled maintenance downtime. Monthly plant shutdowns are occurring to allow for routine maintenance and tie in work to occur for the plant upgrade project to 7.2 million tonnes per annum.
During the quarter, a total of 3,395 tonnes of contained nickel in concentrate, an increase of 20% from Q1 2011 of 2,825 tonnes, 1,065 tonnes of contained copper in concentrate, and 65 tonnes of contained cobalt in concentrate were produced. 3,909 tonnes of nickel in concentrate was sold to Mirabela's customers, Votorantim Metais Niquel SA and Norilsk Nickel, an increase of 88% from Q1 2011 of 2,084 tonnes. One export shipment to Norilsk Nickel was completed during the quarter with the next shipment expected to be completed during August. Steady deliveries to Votorantim continued throughout the quarter.
The processing plant upgrade is ahead of schedule and on budget. Installation of the second ball mill is underway, and with the successful installation of the second pebble crusher and Larox filter now complete, the plant is expected to be capable of running at the 7.2 million tonnes per annum nameplate during the fourth quarter.
The civil works and the installation of pumps and pipelines for the de sliming plant are underway. Final detailed engineering for the crusher upgrade is expected during the third quarter. Both of these projects are currently on target to be completed by the end of 2011.
Pre feasibility work for a further expansion of the open pit and processing plant has commenced. The study is considering an expansion of the open pit ore production and processing plant to 9Mtpa. Finding from the pre feasibility study are expected to be announced by the end of 2011.
Exploration activity for the quarter was focused on tenement maintenance only.
Unit Cash Costs
| Unit | Q2 '11 | Q1 '11 | Change | YTD '11 | |
| Payable Nickel Production | Lbs | 6,662,001 | 5,543,060 | 20% | 12,205,062 |
| Mining Cost | US$/lb | 3.83 | 3.49 | 10% | 3.67 |
| Processing Costs | US$/lb | 2.51 | 2.1 | 20% | 2.31 |
| Administration Cost | US$/lb | 1.05 | 1.08 | -3% | 1.06 |
| Transport/Shipping Cost | US$/lb | 0.06 | 0.17 | -65% | 0.11 |
| By-Product Credit | US$/lb | -1.64 | -1.32 | 24% | -1.49 |
| Operating Unit Cash Cost | US$/lb | 5.81 | 5.52 | 5% | 5.66 |
| Smelter Charges | US$/lb | 2.04 | 1.45 | 41% | 1.76 |
| Unit Cash Cost | US$/lb | 7.85 | 6.97 | 13% | 7.42 |
| Realized Nickel Price | US$/lb | 11.48 | 9.55 | 20% | 10.72 |
| Realized Copper Price | US$/lb | 4.23 | 4.43 | -5% | 4.27 |
| Realized Cobalt Price | US$/lb | 17.72 | 17.85 | -1% | 17.64 |
