Inco to proceed with a US$1.4 Billion nickel-cobalt project at Goro in New Caledonia

Apr 25, 2001, 01:00 ET from Inco Limited

    TORONTO, April 25 /PRNewswire/ - Inco Limited announced today that it
 plans to proceed with construction of a US$1.4 billion commercial nickel-
 cobalt project at Goro in the French Overseas Territory of New Caledonia.
     The company has negotiated the fiscal regime that is expected to be
 approved by the New Caledonian authorities and is in the process of completing
 the remaining regulatory and other arrangements with the government for the
 project. The company is also proceeding to arrange the overall financing for
 the project which will include participation in a program sponsored by the
 French Government providing financial support to investments in French
 Overseas Territories.
     Once the remaining fiscal, regulatory and other arrangements are
 concluded as currently expected over the next several months, construction
 would commence later this year. The current schedule anticipates that the
 project facilities will be completed and production will begin in late 2004.
     The recently-completed bankable feasibility study confirmed the capital
 cost of US$1.4 billion for a fully integrated mining and processing facility
 with an annual capacity of 54,000 tonnes of nickel and 5,400 tonnes of cobalt.
 Cash costs (after cobalt by-product credits) are expected to be below US$1.00
 per pound.
     "Goro is a world class project and will be the centerpiece of our low-
 cost profitable growth strategy," said Inco President Scott Hand. "Everything
 is now coming together to allow us to move forward on the most exciting and
 promising nickel development in the world. With Goro, Inco will hold a pre-
 eminent position in the nickel industry.
     "Our $50 million pilot plant program proved that our proprietary
 hydrometallurgical and solvent extraction process technology works and has
 given us the confidence to proceed with the commercial facility.
     "We think that this has been the right way to go," said Hand. "We have
 carefully and prudently proven the technology on the actual Goro ores and
 trained the people who will be the nucleus for our commercial operation. All
 ores are different and we wanted to make sure that we had it right and we have
 done so."
     The New Caledonian authorities have agreed to grant a 15-year 100 per
 cent tax holiday followed by a 5-year 50 per cent tax holiday. The enabling
 legislation for this tax regime is expected to be passed by the Congress of
 New Caledonia in June of this year.
     "One of the keys to our ability to proceed has been the understanding and
 cooperation of the New Caledonian authorities," said Hand. "They have clearly
 understood the need for a project based on sound technology, engineering and
 economics that will provide reliable, long-term benefits to the Territory and
 the people of New Caledonia."
     Inco is currently in discussions with a number of companies interested in
 acquiring a minority interest in the project. Inco currently holds 85 per cent
 of Goro with the remaining 15 per cent held by France's Bureau de Recherches
 Geologiques et Minieres (BRGM).
     "Goro's reserve and resource position offers an excellent base for the
 Goro operation and we intend to increase our position to allow a major and
 growing presence in New Caledonia for the long-term," Hand stated.
     "We will be celebrating our 100th year in Sudbury next year and intend to
 be there for many years to come. We see the same long-term future for New
 Caledonia."
     Hand said that Inco intends to put in place a world class,
 environmentally sound operation in New Caledonia. The company has rejected
 marine tailings disposal and instead expects to implement a more expensive,
 but environmentally sensitive, land disposal system for tailings.
     The project also includes extensive revegetation of the mining areas.
 Inco has been operating an experimental nursery at the Goro site to assure
 that replanting is compatible with indigenous species, repeating the
 successful program that Inco has implemented at its operations on the Island
 of Sulawesi in Indonesia. Goro's environmental, health and safety policies are
 expected to be compatible with ISO 14000 standards.
     In late 2000, Inco announced the development of a US$5 million training
 program to ensure that local residents have the opportunity to be employed at
 the Goro operation. The commercial operation is expected to provide some 800
 permanent jobs and another 1500 indirect and induced jobs in New Caledonia and
 over 90 per cent of these jobs are expected to be held by New Caledonians.
     The Goro project is expected to produce a nickel oxide product containing
 78 per cent nickel and a cobalt carbonate product. The operation is expected
 to supply stainless steel customers in South Korea, Taiwan and eventually
 China, and the specialty cobalt markets in those countries.
 
     This release contains forward-looking statements regarding the Goro
     nickel-cobalt project and Inco. Actual results may differ materially from
     these statements and projections depending on such key factors as the
     Goro pilot plant operation, engineering and construction timetables,
     construction and operation costs and rates, exploration and pilot plant
     results, nickel and cobalt prices and production rates, product(s)
     produced, financing arrangements, partnership arrangements, tax benefits
     and the timing of the receipt of required governmental, regulatory and
     other approvals and arrangements.
 
     IN 16/01
     April 25, 2001
 
 
 

SOURCE Inco Limited
    TORONTO, April 25 /PRNewswire/ - Inco Limited announced today that it
 plans to proceed with construction of a US$1.4 billion commercial nickel-
 cobalt project at Goro in the French Overseas Territory of New Caledonia.
     The company has negotiated the fiscal regime that is expected to be
 approved by the New Caledonian authorities and is in the process of completing
 the remaining regulatory and other arrangements with the government for the
 project. The company is also proceeding to arrange the overall financing for
 the project which will include participation in a program sponsored by the
 French Government providing financial support to investments in French
 Overseas Territories.
     Once the remaining fiscal, regulatory and other arrangements are
 concluded as currently expected over the next several months, construction
 would commence later this year. The current schedule anticipates that the
 project facilities will be completed and production will begin in late 2004.
     The recently-completed bankable feasibility study confirmed the capital
 cost of US$1.4 billion for a fully integrated mining and processing facility
 with an annual capacity of 54,000 tonnes of nickel and 5,400 tonnes of cobalt.
 Cash costs (after cobalt by-product credits) are expected to be below US$1.00
 per pound.
     "Goro is a world class project and will be the centerpiece of our low-
 cost profitable growth strategy," said Inco President Scott Hand. "Everything
 is now coming together to allow us to move forward on the most exciting and
 promising nickel development in the world. With Goro, Inco will hold a pre-
 eminent position in the nickel industry.
     "Our $50 million pilot plant program proved that our proprietary
 hydrometallurgical and solvent extraction process technology works and has
 given us the confidence to proceed with the commercial facility.
     "We think that this has been the right way to go," said Hand. "We have
 carefully and prudently proven the technology on the actual Goro ores and
 trained the people who will be the nucleus for our commercial operation. All
 ores are different and we wanted to make sure that we had it right and we have
 done so."
     The New Caledonian authorities have agreed to grant a 15-year 100 per
 cent tax holiday followed by a 5-year 50 per cent tax holiday. The enabling
 legislation for this tax regime is expected to be passed by the Congress of
 New Caledonia in June of this year.
     "One of the keys to our ability to proceed has been the understanding and
 cooperation of the New Caledonian authorities," said Hand. "They have clearly
 understood the need for a project based on sound technology, engineering and
 economics that will provide reliable, long-term benefits to the Territory and
 the people of New Caledonia."
     Inco is currently in discussions with a number of companies interested in
 acquiring a minority interest in the project. Inco currently holds 85 per cent
 of Goro with the remaining 15 per cent held by France's Bureau de Recherches
 Geologiques et Minieres (BRGM).
     "Goro's reserve and resource position offers an excellent base for the
 Goro operation and we intend to increase our position to allow a major and
 growing presence in New Caledonia for the long-term," Hand stated.
     "We will be celebrating our 100th year in Sudbury next year and intend to
 be there for many years to come. We see the same long-term future for New
 Caledonia."
     Hand said that Inco intends to put in place a world class,
 environmentally sound operation in New Caledonia. The company has rejected
 marine tailings disposal and instead expects to implement a more expensive,
 but environmentally sensitive, land disposal system for tailings.
     The project also includes extensive revegetation of the mining areas.
 Inco has been operating an experimental nursery at the Goro site to assure
 that replanting is compatible with indigenous species, repeating the
 successful program that Inco has implemented at its operations on the Island
 of Sulawesi in Indonesia. Goro's environmental, health and safety policies are
 expected to be compatible with ISO 14000 standards.
     In late 2000, Inco announced the development of a US$5 million training
 program to ensure that local residents have the opportunity to be employed at
 the Goro operation. The commercial operation is expected to provide some 800
 permanent jobs and another 1500 indirect and induced jobs in New Caledonia and
 over 90 per cent of these jobs are expected to be held by New Caledonians.
     The Goro project is expected to produce a nickel oxide product containing
 78 per cent nickel and a cobalt carbonate product. The operation is expected
 to supply stainless steel customers in South Korea, Taiwan and eventually
 China, and the specialty cobalt markets in those countries.
 
     This release contains forward-looking statements regarding the Goro
     nickel-cobalt project and Inco. Actual results may differ materially from
     these statements and projections depending on such key factors as the
     Goro pilot plant operation, engineering and construction timetables,
     construction and operation costs and rates, exploration and pilot plant
     results, nickel and cobalt prices and production rates, product(s)
     produced, financing arrangements, partnership arrangements, tax benefits
     and the timing of the receipt of required governmental, regulatory and
     other approvals and arrangements.
 
     IN 16/01
     April 25, 2001
 
 
 SOURCE Inco Limited