Inco gives green light for Voisey’s development

With all the political wrangling now seemingly behind it, Inco (N-T) has formally announced that it will proceed with the initial phase of its Voisey’s Bay nickel-copper-cobalt project in Labrador and Newfoundland.

The decision was based on a newly released, favourable bankable feasibility study for a mine, concentrator and related facilities at Voisey’s.The study, completed by SNC Lavalin, expanded on a prefeasiblity completed at Voisey’s in 1999.

Unfortunately for Inco, the projected capital cost of building a 6,000-tonne-per day mine-and-mill complex is now pegged at US$582 million, or US$77 million more than first envisaged in the prefeasibility study.

(The US$582-million figure includes US$54 million in contingency funds, as well as the US$35 million spent since July 2002 on infrastructure.)

Another US$134 million will be spent by Inco for a major research and development effort to develop hydrometallurgical processing technologies for the treatment of the Voisey’s nickel and cobalt concentrates.

This phase will include the construction of a demonstration plant at Argentia on the island of Newfoundland.

Still more money will be spent to build handling facilities at Inco’s existing Canadian operations for the nickel and cobalt concentrates, so that they may be processed over the 2006-11 period — i.e. in the years before a commercial hydrometallurgical plant could come online at Argentia.

Inco has also budgetted US$13 million for exploration at Voisey’s.

In total, the capital cost estimate for all parts of the initial phase of the Voisey’s Bay project is US$776 million, or about 14% above the prefeasibility study estimates of US$680 million.

Over its planned life, the Voisey’s Bay project is expected to have annual production of about 50,000 tonnes of nickel, 38,600 tonnes of copper and 2,270 tonnes of cobalt.