Canico expands Onca-Puma project

Canico Resource (CNI-T) has boosted the inferred resource estimate for its Onca and Puma nickel laterite deposits in Brazil’s Para state.

Based on a cutoff grade of 1.5% nickel over a minimum width of 2 metres, the Onca deposit is now believe to contain 69.9 million dry tonnes averaging 2.12% nickel and 0.12% cobalt. The average thickness of the laterite is pegged at 6.5 metres.

That’s up from last year’s resource estimate of 22.6 million tonnes running 2.1% nickel, also at a 1.5% nickel cutoff.

The revised estimate is based on 485 holes drilled in 2003, including the following:

• hole 3463 — 10.4 metres (from 38.4 metres below surface) grading 3.1% nickel;
• hole 3433 — 3.1 metres (from 8 metres) averaging 4.1% nickel, 7.7 metres (from 15.6 metres) of 2.2% nickel, and 4.3 metres (from 27.1 metres) of 3.2% nickel;
• hole 3473 — 13.5 metres (from 16.6 metres) running 2.3% nickel;
• hole 3475 — 13 metres (from 3.2 metres) carrying 2.3% nickel.

Based on 24 new holes (and 244 holes in all) drilled along strike and west of the main Puma ridge, the inferred resource at the Puma West deposit is now pegged at 34.6 million tonnes grading 2.21% nickel and 0.07% cobalt. The new estimate is 900,000 tonnes greater than the previous estimate; grades are unchanged.

The Puma deposit lies 10 km to the northeast of Onca.

The latest round of drilling was completed on lines spaced 200 metres apart and orientated perpendicular to the strike of the deposits. Holes were collared 200 metres apart at Onca, 100 metres apart on the Puma main zone, and 200 metres apart on Puma West.

Canico believes the shallow, flat-lying laterites are amenable to the type of conventional, pyrometallurgical processing now being used at several other operations, including P.T. Inco, Cerro Matoso, Loma de Niquel, and Falcondo.

Canico intends to complete a scoping study at Onca-Puma this fall; a full feasibility study would follow in late 2004. A cutoff grade for resources for the final feasibility study has yet to be determined.

Resource at Onca-Puma are found in two lenticular ridges separated by a third ridge representing an iron formation. The east-west-striking Onca deposit measures 20 by 1 km, and averages 4.1 metres in thickness. The 1-km-wide Puma West target extends for 12 km and averages 7.8 metres in thickness.

Canico has 10 rigs performing infill drilling on a 100-metre grid. Bulk-sample material from several pits will be tested at a metallurgical pilot plant in Norway. The company has also completed an initial environmental impact study.