Hard Creek up on Turnagain nickel estimate

Vancouver – Hard Creek Nickel (HNC-V, HNCKF-O) says it wants to spend at least one more year drilling its large, low grade nickel deposit in northern British Columbia before deciding whether to sell the project outright or bring in a partner.

Hard Creek President Mark Jarvis issued the pledge after releasing a new resource estimate for the Turnagain property east of Dease Lake, which sparked active trading in the companys shares on February 12.

We want to do one more year where we own 100% of the project and complete more drilling, said Jarvis, adding that the company expects to spend about $7 million on the project this year.

Based on new drill information, Hark Creek said measured and indicated resources at the Turnagain property has jumped to 428.5 million tonnes, averaging 0.17% sulphide nickel and 0.01 cobalt per tonne.

That marks a 235% increase from a preliminary estimate released in June 2006, by engineering firm AMEC Americas Ltd.

Shares of Hard Creek responded by rising 4 to $1.61 on TSX Venture Exchange in active trading of 859,073 following the updated resource estimate.

In arriving at the latest estimate, Hard Creek used results from 24,408 metres of drilling in 117 holes.

According to a July, 2006, report by AMEC, the capital cost of developing a 50,000 tonne-per-day open pit operation at Turnagain was estimated at $867 million, including $495 million for direct infrastructure costs (power, road, plant etc.).

At the time, the AMEC was advising Hard Creek to proceed with further exploration drilling, mine engineering and metallurgical work before proceeding to a prefeasibility study that would help determine the economics of developing a mine at the site.

Now Jarvis is thinking that the throughput in a future open pit mining operation could be raised to 100,000 tonnes-per-day, a move that he believes will increase the capital cost of developing a mine by at least 50%.

Since it was first discovered Turnagain has suffered from the perception that the nickel will be difficult to recover. However, Jarvis said he believes AMEC has addressed that issue by conducting over 100 bench scale metallurgical tests using standing froth flotation methods on composites.

If anyone has any questions about metallurgy, they can just take a look at the work we have done, he said. Hard Creek said sulphide nickel grades are based on ammonium citrate hydrogen peroxide leach analyses.

Ammonium citrate-hydrogen peroxide leach analyses for nickel provided a good estimate for nickel grades present in sulphide form and display excellent correlation with recoveries in metallurgical test work, the company said.