First Nickel Inc announced preliminary fourth quarter and full year payable metal production for the Lockerby Mine in Sudbury,Ontario.
Payable nickel production from the Lockerby Mine is expected to be below the previously disclosed guidance range for the full year and fourth quarter by approximately 10%and 38%,respectively.
Fourth quarter production was primarily impacted by two factors:
1.November nickel production of approximately 310,000 pounds was approximately 35%of the planned production rate.The shortfall was primarily the result of slower than planned development preparation of two ore sources.Both of these sources produced ore as expected during the subsequent month of December.
2.December nickel production was approximately 65%of the planned production rate as a result of unplanned rehabilitation work at a main ramp intersection which was completed in 2008.Five days of rehabilitation work was required,during which time ore production and development were suspended since the intersection was located above current production levels.The rehabilitation work was completed,and operations recommenced on December 29th.
As a result of the shortfall in fourth quarter production,FNI now expects Lockerby to complete the ramp up and achieve full production in the first quarter of 2013,instead of in the fourth quarter of 2012.
In the third quarter,the Company reported that it expected to be within the production guidance range for the full year.In addition to the items identified above,during the fourth quarter,Xstrata processed approximately 60,000 tonnes of Lockerby ore,which had been previously delivered in the third quarter.That processing resulted in lower than expected nickel and copper grades,and lower than expected nickel recovery,reducing year to date nickel production by approximately 460,000 pounds.Both ore grades and metal recoveries for lots processed prior to the fourth quarter performed within an acceptable variance range.An investigation into both the lower than predicted ore grade and lower than plan recovery is in progress.