African Rainbow Minerals (ARM) and LionOre Mining International, the 50:50 joint venture owners of the Nkomati Nickel Mine in the Mpumalanga Province in South Africa, are to proceed with a project to increase monthly production in order to maintain nickel output at 5,000 t/month. The partners are continuing to evaluate this major expansion project (likely to include an Activox metal refinery) and it is anticipated that this evaluation and feasibility study will only be complete in 2007. The concentrator has been designed to form an integral part of the major expansion project in the future.

The current operation processes approximately 30,000 t/month from the MSB orebody with an output of 5,000 t/y of nickel and associated by-products. It is anticipated that this orebody will be depleted during 2008. A new 100,000 t/month concentrator, tailings dam and related infrastructure to mine from the disseminated Main Mineralised Zone (MMZ) orebody, will be built at an estimated capital cost of  $62 million, to be spent over the next 18 months. It is anticipated that full production at an annualised rate of 5,000 t of nickel will be achieved by the end of 2007 and will continue for at least 10 years.

Mining of the MMZ reef will be from two areas; 47,000 t/month from the current underground infrastructure and 53,000 t/month from surface mining, at a combined run of mine grade of 0.58% Ni. In addition to the nickel, the concentrate produced will contain significant by-products (copper, cobalt and PGMs) and will continue to be toll refined at various facilities around the world.

LionOre’s Chief Executive Officer, Colin Steyn said: "The interim plan is a common sense extension to Nkomati’s life and nickel production while both partners continue to fully evaluate and optimise the expansion potential."