Toledo - Cashflow from the world's 3rd largest Nickel Resource

another big nickel project:

"Today's announcement allows Falconbridge and SMSP's joint venture company to receive ownership of Koniambo. We can now look forward to advancing this world-class resource to the next phase of development."

In the year ahead, the partners plan to advance detailed engineering plans for the project.

The start of construction is scheduled for 2007, with startup in 2009 at the earliest.

Koniambo is one of the world's largest nickel deposits. Falconbridge, which has about 14,500 employees, signed the joint-venture agreement with SMSP in 1998, for the evaluation and development of a 60,000-tonne per year nickel mining and smelting complex.

Last week, the company announced that it and SMSP had agreed to terms on Koniambo.

Under their deal:

-Falconbridge has agreed to assume responsibility for financing of up to 100 per cent of the project.

-Ownership of Koniambo remains at 51 per cent for SMSP and 49 per cent for Falconbridge.

-Cash generated by the project will be used to pay off debt before any shareholder distributions.
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