Mirabela announces positive results from smelter scoping study


    Ordinary shares outstanding: 127,776,100

    PERTH, AUSTRALIA, Feb. 11 /CNW/ - Mirabela Nickel Limited (TSX: MNB, ASX:
MBN) is pleased to announce that a scoping study for a nickel sulphide smelter
at its Santa Rita project has returned positive results with preliminary cost
estimates as follows:

    Capital expenditure - US$254m
    Operating cost - US$111/t of concentrate

    As a result of these encouraging results, the Company is proceeding with
a full feasibility study to build a smelter at Santa Rita. A smelter would
provide the following major benefits:

    -   Substantial increase in nickel payability
    -   Increase in payability for credits for Cu, Co, Au and PGEs.
    -   Savings on transport costs
    -   Optimization of mine, concentrator and smelter circuit

    "The scoping study indicates that a smelter at Santa Rita could be an
important value proposition for the Company," said Managing Director Nick
Poll. "It's all about making the most of the economies of scale that are
available to us and Santa Rita now has the third largest open-cut, nickel
sulphide mining reserve in the world. A smelter would allow the Company to
capture the revenue and operating benefits of downstream processing, whilst
reducing transport costs. We believe that the demand for nickel matte, the
smelter product, is even stronger than the demand for nickel concentrate, so a
smelter would also strengthen the Company's strategic position in the nickel
market," he said.
    "At this stage, we are working through the options and implications of a
smelter in detail. We remain focused on producing nickel concentrate, starting
in 2009, from the currently planned operation for at least the first few
years," said Mr Poll.
    The results of the smelter study coincide with today's announcement of
new drilling results that extend mineralization about 120m down dip of the
recently announced open-cut mining reserve, with composite intersections up to
135m grading 0.83% nickel located in the Southern high grade zone of the Santa
Rita deposit. The occurrence of such thick mineralization is very encouraging
and is expected to increase the open-pit mining reserve.
    The positive smelter study has come on the back of several announcements
in the past month, including the first mining reserve at Santa Rita, an
updated CAPEX for the planned increase in capacity of the concentrator to
4.6mtpa and the mandating of debt financing.

    Study details

    WorleyParsens, a leading specialist in pyrometallurgical processing,
completed the scoping study using the following Mirabela assumptions:

    -   230ktpa concentrate throughput rate
    -   12% nickel concentrate grade
    -   25,000t of nickel a year output

    The above assumptions are consistent with an expected 6.0mtpa production
rate from the Santa Rita mine.
    Whilst the current planned capacity of Santa Rita is 4.6mtpa for 18,500t
of nickel output, it is expected that this will be increased to 6mtpa for
25,000t of nickel within the first few years of operation due to continued
growth of the resource.
    The scoping study costs are estimated to within +/- 50% and used a
Brazilian Real exchange rate of R$2.05 to the US dollar.
    WorleyParsons has been commissioned to proceed with the feasibility
study, a team has been appointed and work is underway. The project will be
split into two stages. Stage one is expected to cover preliminary test work,
thermodynamic modelling, conceptual engineering and estimation of capital cost
to within +/- 30% for a cost of about A$2m. Stage two will cover more detailed
engineering and estimation of capital cost to within +/- 15%. It is expected
Stage one will be completed in Q3 2008 and Stage two in Q3 2009. It is
expected that a smelter would take about 2 years to construct.


    Mirabela Nickel is listed on the Australian and Toronto stock exchanges.
With a proven and probable mining reserve of 84mt at 0.61% Ni and growing,
Santa Rita is the world's largest greenfields nickel sulphide discovery in the
last 12 years and the third largest open-cut nickel sulphide mining reserve.
Exploration is continuing to increase the in-pit reserves and determine
underground mining potential below 500m deep, as mineralization appears to
continue well below current drilling.
    Construction of a nickel sulphide concentrator commenced in November 2007
and is progressing well. The plant is expected to produce 18,500t a year of
nickel in a sulphide concentrate from one open-cut mine starting from mid
2009. At this rate of production the project is expected to have a mine life
of at least 18 years. Studies are underway to increase nickel production to
25,000t a year.


    Nick Poll
    Managing Director

    Caution Regarding Forward Looking Statements: There can be no assurance
that an expanded mineral resource or reserve will be established at the Santa
Rita Project. The forward-looking statements made in this news release are
based on assumptions and judgments of management regarding future events and
results. Such forward-looking statements, including but not limited to those
with respect to the construction and development of a 18,500 tonnes per year
and subsequently a 25,000 tonnes per year nickel sulphide concentrator and a
nickel smelter at the Santa Rita Project and the required capital expenditures
and estimated future production and operating cash costs involve known and
unknown risks, uncertainties, and other factors which may cause the actual
results, performance or achievements of the Company to be materially different
from any anticipated future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors include, among
others, the actual market prices of nickel, the actual results of current
exploration, the actual results of future mining, processing and development
activities, changes in project parameters as plans continue to be evaluated,
as well as those other factors disclosed in the Company's filed documents.

For further information:

For further information: Australia contact: Nick Poll, Managing
Director, Telephone: +61 8 9324 1177, nickp@mirabela.com.au; Toronto contact
(media): Eric Tang, Porter Novelli, Telephone: (416) 422-7200,
eric.tang@porternovelli.com; Australia contact (media): Caroline de Mori,
Purple Communications, Telephone: +61 8 9485 1254, cdemori@purplecom.com.au

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