First Nickel boosts indicated resource 289% at Lockerby

Since buying its Lockerby mine in Sudbury less than three years ago, First Nickel‘s (FNI-T) indicated resources have grown more than tenfold, according to a new resource estimate.

The mine boasts an upgraded resource estimate equating to a total of 113 million lbs of contained nickel in the indicated resource category for the Lockerby depth zone — a net increase of 68 million lbs over previous numbers reported in March 2007.

Using a 1.0% nickel equivalent cut-off grade, First Nickel reported an NI 43-101 compliant mineral resource estimate containing indicated resources of 2.89 million tonnes grading 1.78% nickel, 1.23% copper and 0.07% cobalt, from the 65 to 72 levels, and inferred resources of 0.38 million tonnes grading 1.37% nickel, 1.05% copper and 0.05% cobalt, below the 72 Level.

The new resource estimate does not include the mine’s 64 level, which was part of the March 2007 resource estimate and is currently being mined.

In a conference call announcing the results, management conceded the grades were somewhat lower than the ones reported in the previous indicated resource estimate released on March 5 of 2.07% nickel, 1.45% copper and 0.07% cobalt from the 64 to 67 levels (using a 1.2% nickel equivalent cut-off grade.) The company also reported inferred resources in March grading 1.98% nickel, 1.12% copper and 0.07% cobalt from the 67 to 72 levels.

But the company’s president and chief executive officer, W.J. Anderson, noted that the depth zone is still wide open and “going strong down to 72 and beyond” and that the grade can vary fairly widely. “I wouldn’t be surprised to see [grade] numbers coming back up again as we get more details,” he said. “We’re only six weeks away from some final numbers so let’s wait to see those come out. I’m personally pretty optimistic but we’ll work the numbers through and see what we get.”

Anderson noted that the company will be in development ore at the 65 level as early as March.

The new resource estimate should enable the company to plan for mine expansion and greater production, company officials say. First Nickel will complete a new life of mine study in the first quarter of the year. That study will involve engineering and economic comparisons of shaft extension options and mine design.

The company estimates that infrastructure improvements based on the new resource model will not only boost output and productivity as well as cut costs, but will also prolong the life of the mine by an extra 8 years or more.

The resource estimate was based on a total of 164 drill holes comprising 32,453 metres of diamond drill core and 5,096 assay results.

In Toronto, First Nickel’s shares slid 0.1 to 0.52 on about 1.3 million shares traded.