First Nickel’s Lockerby, Ontario, Mine Restructured Due to Low Prices

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First Nickel has announced that the Lockerby nickel/copper mine, located in the Sudbury basin in Ontario, is being restructured in order to reduce costs, increase exploration and extend mine life.

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In December 2014, the Company concluded that, unless costs could be substantially reduced, developing the mine below the 6800 level would be uneconomic based on the current cost structure.

Thomas M. Boehlert, President & Chief Executive Officer, commented: “The employees at Lockerby have done a remarkable job in recent months to improve performance at the mine, with nickel production in the second half of 2014 improving significantly compared to the first half. However, the combination of persistently low nickel prices and our underlying cost structure has had a negative impact on our ability to generate the funds required to continue development of the mine.”

The cash price of primary Indian nickel experienced the biggest price decline of the day, dropping 1.4% to close at INR 955.30 ($15.38) per kilogram on Monday, January 12. On the LME, the spot price of nickel gained 0.8% to finish at $15,430 per metric ton. On the LME, the 3-month price of nickel rose 0.7% to $15,505 per metric ton.

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Chinese stainless steel closed mixed yesterday. At CNY 10,900 ($1,756) per metric ton, the price of Chinese ferro-chrome was essentially unchanged. The price of Chinese ferro-moly showed little movement on Monday at CNY 88,000 ($14,174) per metric ton.

The price of Chinese primary nickel fell 0.5% to CNY 110,500 ($17,798) per metric ton. The Allegheny Ludlum 316 stainless surcharge was unchanged at $1.01 per pound. The price of Chinese 316 stainless coil remained essentially flat at CNY 23,700 ($3,817) per metric ton. Chinese 304 stainless coil saw little change in its price on Monday at CNY 16,700 ($2,690) per metric ton. The price of Chinese 316 stainless steel scrap remained essentially flat at CNY 13,150 ($2,118) per metric ton.

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