According to:

http://www.chinamining.org/News/2009-07-27/1248677059d27294.html

Timmins nickel mine reopens
(THE SUDBURY STAR)
Updated: 2009-07-27 14:33
Counter:695

The strike at Vale Inco is beginning to "bite" into nickel inventories according to one analyst, prompting a Timmins- area nickel miner to reactivate one of its two dormant mines.

Liberty Mines Inc. announced Wednesday its McWatters Mine is going back into production. The mine had been in care and maintenance mode since October.

Gary Nash, Liberty Mines' president and chief executive officer, said that with the strikes at Vale Inco operations in Sudbury and Voisey's Bay and the closure of 40 other nickel mines around the world, the price of nickel is back to a point where nickel mining is viable.

Liberty Mines has two operating mines, one mine in development and several nickel/copper and nickel/cobalt projects in the works in the Timmins and Gogama areas.

Nickel analyst Terry Ortslan of TSO & Associates in Montreal said the strike by United Steelworkers of America Local 6500 in Sudbury will have a creeping impact on world nickel supplied.

"The strike will soon start biting into inventories very soon," he said.

"By September, we are going to see a dramatic change starting in the (nickel) inventories.

"I think it's going to occur in the mid-late fall. You will see quite a different picture in inventories. The bottom line is the longer the strike, the bigger the impact will be."Ortslan said the global stainless steel industry is a big consumer of nickel, which traditionally slows down during the summer months, and will help lead the return of demand for nickel.

"The stainless steel (industry) is good, but it's not going to be going like gangbusters until 2010," he said.

Ortslan said he expects world nickel prices to gradually increase in the months ahead.

"Even in the slow times in the summer, you are seeing good price activity," he said. "It's an indication the market is not all that weak."Nickel was selling for $7.19/lb US on the London Metal Exchange on Wednesday.

Liberty Mines will send its nickel concentrate either to Xstrata Nickel's smelter in Falconbridge or the Jilin Jien Nickel Industry Company in Panshi City, China. Thanks to a $30 million Cdn transaction completed in the spring, Jilin Jien is now Liberty Mines' largest shareholder, holding a 51 per cent stake in the company.

The move to resume production at the McWatters Mine will result in 24 mining jobs and another 25 to 30 in the mill.

Another nickel miner, First Nickel, which owns the Lockerby Mine in Sudbury, is looking to finance redevelopment work at the mine before production resumes there. Production at the mine was halted last October.

President and chief executive officer William Anderson said Thursday $37 million Cdn will have to be raised and extensive work completed before mining can resume.

"We need to extend the ramp and the infrastructure in the mine to allow us multiple access to the commodity," he said. "We're looking at a 10-12 month timeframe. It depends on how fast you can advance."Anderson said the mine was closed last October because it wasn't profitable to produce nickel when it was worth $5 a pound US.

Ore from Lockerby Mine is processed at the Xstrata Nickel smelter.

FNX Mining is now only mining from its Podolsky Mine and a portion of its Levack Mine operation -- the Levack Footwall deposit. FNX has five nickel projects locally, but shut down its McCreedy West and Levack Mine main operations in October and December respectively due to falling nickel prices.