Toronto-based FNX Mining would start delivering ore on Wednesday from its Sudbury operations to Vale Inco's Clarabelle mill, spokesperson David Constable told Mining Weekly Online.
FNX shares rose 4% on the news, to C$9,55 apiece by 13:32 in Toronto.
Vale Inco, which has a long-term processing agreement covering all FNX ore, closed all its operations in Sudbury at the end of May for an extended maintenance shutdown, and has yet to reopen, after more than 3 000 union members went on strike in mid-July.
FNX continued mining in the meantime, and reached an agreement last month with Vale's rival in the Sudbury basin, Xstrata Nickel, which will process more than 150 000 t of FNX ore at its own mill.
About 157 000 t of ore was shipped to Xstrata by the end of August, and will be processed in October, FNX said on Wednesday.
Meanwhile, Vale has announced it will restart partial production in Sudbury with its own nonstriking staff and FNX was recently notified that it should restart ore deliveries.
The company will start shipping ore from a 10 000-t surface stockpile of crushed and sampled ore, followed by the about 11 000 t that is not yet crushed and sampled.
“Now that we know we have to start delivering, we will start crushing and sampling that material, getting it ready to ship out,” Constable said.
The company will aim to truck the stockpiled ore as fast as possible to Vale's mill, although the actual timing will depend on how quickly the trucks can get through the picket lines set up by striking workers at Clarabelle.
Once the stored-up ore has all been shipped to Vale, trucking will continue at a steady state of about 2 000 t/d, as the ore is mined from FNX's operations.
Despite the notification sent to FNX, Vale Inco has yet to set a date for operations to restart.
Spokesperson Cory McPhee said on Wednesday that the company is currently moving ore that is inventoried at its Stobie mine to the Clarabelle mine, as it tests the mill circuit and trains staff for a resumption of partial production.
“That resumption has not yet occurred nor has there been a definitive date established for that resumption to begin,” he added.
“When it does we will be processing ore from FNX, and the Stobie inventory as well as ore mined at the 153 orebody at Coleman Mine and our Garson ramp,” McPhee said.
He was not in a position to disclose projected levels of any ore that would be processed.
When it restarts mining, Vale has said it will target parts of the orebody with high grades of copper and platinum-group metals, and is understood to have reconfigured the mill for the short term to focus on recovering copper concentrate, which could be sold to a local smelter.
The ores from both Vale and FNX's mines would likely also produce some quantities of nickel and precious metal.
FNX is currently producing from the copper and precious-metal rich Rob's deposit at the Levack mine, PM deposit at McCreedy West and 2 000 deposit at the Podolsky operation.
It is also developing the Levack Footwall deposit, at Levack, and expects to have it in commercial production around mid-2010.
Last year, the firm suspended nickel-ore mining at both McCreedy West and Levack and cut more than 300 jobs, after nickel prices dropped.
Nickel traded above $22/lb in 2007, but fell sharply, after slowing global economic activity dampened demand for the metal, which is used to make stainless steel.
Spot nickel was trading at around $8/lb on Wednesday.
Both Xstrata and Vale have also curtailed Sudbury operations and delayed projects this year because of weak demand and prices for the metal.
FNX was formed in 2002, when it bought five Sudbury properties from what was then Inco, and has made several discoveries of its own since then.
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