Asian Mineral Resources (ASN-V) has released revised capital and operating cost estimates for its Ban Phuc nickel project, 180 km north of Hanoi in Vietnams Son La Province.
The New Zealand-registered company says the revised total estimated capital cost of the project is now US$62.1 million, including a US$5.1 million contingency cost.
Asian Mineral Resources holds a 90% interest in the development, with the remaining 10% owned by the Son La Mechanical Engineering Joint Stock Company.
The revised estimate indicates average processing costs of about US$15.99 per tonne and operating costs over the total life of the mines underground operations of US$51.8 million.
The new numbers are based on assumptions including commodity prices of US$30,000 per tonne nickel, US$4,400 per tonne copper, and US$16.15 per tonne cobalt.
The revised base case financial model also finds net present value of US$172 million and an internal rate of return of 130%.
Based on the above estimates, the payback period will be nine months after the mine goes into production.
Ban Phuc, Vietnams only known nickel deposit, contains over 121,000 tonnes of nickel.
The deposit has a 1.22 million tonne measured and indicated massive sulfide resource and a large disseminated sulfide resource.
The first-stage development has an ore reserve of 1.0 million tonnes of 2.4% nickel, 1.0% copper and 0.1% cobalt.
Asian Mineral Resources has a foreign investment licence valid until 2013 covering 150 sq. km of very prospective ultramafic hosted nickel occurrences.
The company will not be taxed for the first four years after capital recovery. It will then be taxed at a 7.5% rate for the next four years and at 15% thereafter. It is import-duty exempt and the company will pay the government a 3% royalty on all recovered metal.
The project has access to a main road, power and water all within one km of the site.
Ban Phuc was first explored by a Vietnamese exploration team in 1959. At that time, surface and underground surveys entailed 12.5 km of diamond drilling, 3.1 km of adits and crosscuts, 1.0 km of exploration shafts, trenching and more than 8,000 assays for nickel and more than 4,000 for copper.
The mine is expected to start production in 2008.
In Toronto, the companys shares finished 2.35% higher at $1.74 on 17,500 shares traded.
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