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Gold/Mining/Energy : Inco-Voisey Bay Nickel [ T.N.V] -- Ignore unavailable to you. Want to Upgrade?

To: Mitchell who wrote (734)	7/15/1999 9:35:00 AM
From: CJones	Read Replies (1) \| Respond to of 1615

"Secret mining proposal" !!! :)?? Financial Post story - Thur/July 15 Thursday, July 15, 1999 Inco forms new plan for Voisey's Drilling resumes: Company hopes to strike a deal by end of year Keith Damsell Financial Post Inco Ltd. is developing a new plan to mine the Voisey's Bay nickel deposit and hopes to conclude a deal with the Newfoundland government by the end of the year, the Toronto nickel giant said yesterday. "We're developing our proposal, but we have not set a deadline as to when we would sit back at the table," said Alan Stubbs, an Inco spokesman. "We have a six-month time frame in front of us. It would be our hope that in the next little while to sit down with the province and get started on this." The secret mining proposal may mark a breakthrough in the development of the massive 124-million-tonne nickel deposit, discovered in remote Labrador almost five years ago. Negotiations between Inco and the Newfoundland government to develop the project have been stalled for a year. To better define the scope and size of the resource, Inco will resume exploration of Voisey's Bay in September. The company plans to spend $3.6-million on drilling, the first step toward underground exploration. To date, Inco has spent more than $80-million exploring the site. The renewed exploration efforts were greeted with optimism in Newfoundland. "This proves they have some confidence up there," said Bruce Hollett, the province's lead negotiator on Voisey's Bay. But Mr. Hollett was wary of resuming negotiations any time soon. "The ball has been in their [Inco's] court for some time. We're awaiting a proposal that will be good for the province and give us the benefits we need," he said. "Any deadline is the company's deadline." Inco acquired the Voisey's Bay property in a $4.3-billion deal with Diamond Fields Resources Inc. three years ago and had hoped to begin production this year. But the plunging price of nickel and subsequent cash crunch forced Inco to renege its original commitment to build a $2.6-billion smelter in Argentia. The Newfoundland government rejected the company's revised $1.1-billion proposal that called for a smaller milling operation and ore processing in Ontario and Manitoba. Formal negotiations ended last July 23. In the past 12 months, both sides in the dispute have slowly soften their stance. Inco has not ruled out further processing in Newfoundland, while Brian Tobin, the Premier, has said the province may consider a smaller mining project. Meanwhile, interested parties have become increasingly vocal, urging the nickel company and its political foes to end the stalemate. In a June 23 speech in Labrador, John Crosbie, a former federal cabinet minister, urged Newfoundlanders "to insist vociferously that an agreement be reached this year." A day later, at the annual meeting of Franco-Nevada Mining Corp., chairman Seymour Schulich urged Ottawa to use its weight to solve the dispute. The mining royalty company owns 37% of a special class of Inco shares tied to profits from Voisey's Bay. Despite strong recent gains in nickel prices, Bay Street analysts remain skeptical a settlement is within reach. "This is more a game of politics than economics," said Manford Mallory, analyst at Research Capital Corp. in Toronto. "I certainly have low expectations that any kind of economic smelter-refinery can be built in Newfoundland."