Fortune chooses Saskatoon for refinery

Fortune Minerals Ltd. has identified a site in Saskatchewan for a processing facility for its Nico Project located 160 kilometers, or 99 miles, northwest of Yellowknife, Northwest Territories. The junior said Nov. 3 that it entered into an agreement to purchase land near Saskatoon, Saskatchewan, where it aims to build its southern hydrometallurgical facility for the Nico gold-cobalt-bismuth-copper project in Northwest Territories.

Fortune wants to start a vertically integrated mining operation at Nico by 2012, assuming it obtains necessary regulatory approvals.

The Toronto-based company decided to relocate the metal refining part of the Nico project from the mine site in Northwest Territories to the Saskatoon area to reduce capital and operating costs for the project, mitigate exposure to increasing energy costs, accelerate the construction schedule, reduce environmental impacts at the mine site, and speed the permitting process already in progress.

Bulk concentrates will be transported by truck and rail from Nico to the Saskatoon area for processing to high-value metal products, including gold doré, cobalt, copper and bismuth cathodes, and a nickel precipitate byproduct.

Fortune said it believes the selection of the Saskatoon site is an important step forward in its planned development of Nico and reduces project risk.

The land purchase is subject to certain conditions, including completion of satisfactory due-diligence of the site and appropriate re-zoning.

Enterprise Saskatchewan and the Saskatoon Regional Economic Development Authority have been working with Fortune Minerals personnel over the past several months to identify a suitable Saskatchewan location for the metallurgical processing plant in the province.

The proposed Saskatoon refinery site includes access to the main line of the Canadian National Railway, which can accommodate a spur for delivery of concentrates from the mine, re-agents and other supplies, and ship metal products to industrial centers in North America or points of export. The property is also close to the Trans-Canada Highway and other services, including power, natural gas, and water supply.

Saskatoon is the fastest growing city in Canada and the commercial center for the province of Saskatchewan.

"With a diversified economy, a highly skilled work force and respected post-secondary institutions, Saskatoon can accommodate everything that is required to construct and operate this refinery," said Fortune Minerals President Robin Goad.

Based on Fortune's current mine plan, the Saskatoon refinery will process about 80,000 metric tons of Nico sulphide concentrates each year, producing average annual production of about 4 million pounds of 99.8 percent cobalt cathode, 4.2 million pounds of 99.5 percent bismuth cathode, as well as 81,000 ounces of gold in each of the first two years of the mine life, followed by 27,000 ounces of annual gold production in subsequent years.

About 760,000 pounds of 99.9 percent copper cathode and a nickel precipitate also will be produced as byproducts of the cobalt refining process.