Brilliant Mining to begin Ni deliveries at spot prices
2007-08-01 06:47 MT - News Release
Mr. John Williamson reports
BRILLIANT NICKEL PRODUCTION UN-HEDGED; LANFRANCHI NICKEL MINE, KAMBALDA DISTRICT OF WESTERN AUSTRALIA
Brilliant Mining Corp.'s future nickel ore deliveries will be paid at spot nickel prices.
Key point summary:
* All nickel ore deliveries commencing Aug. 1 will be paid at spot nickel (Ni) prices;
* Current spot nickel prices are more than 2.5 times greater than hedged nickel prices currently received.
"Since we acquired the project, we have ramped up mining operations, discovered new nickel resources, eliminated all bank debt and increased the corporate cash treasury; despite the unfavourable nickel hedge contracts we inherited," stated John Williamson, chief executive officer of Brilliant Mining Corp. "With the nickel hedge contracts unwinding and our production profile increasing, the future for Brilliant is very promising."
Brilliant Mining acquired a 25-per-cent interest in the Lanfranchi joint venture in May, 2006. Through the acquisition, the company became party to a series of monthly forward nickel contracts, initially set at $6.75 (U.S.) per pound at the commencement of the contract period and decreasing to $5.50 (U.S.) per pound until the end of the term.
The current spot price of nickel, at over $14.00 (U.S.) per pound, is more than 2.5 times greater than the hedged nickel prices currently received, thus the projected net revenue received by Brilliant per pound of nickel mined will now increase significantly. The company has not entered into any additional nickel hedge contracts at this time.
The project is supervised by John Williamson, PGeo, of Edmonton, Alta. Mr. Williamson, chief executive officer and a director of Brilliant Mining, is the qualified person as defined in National Instrument 43-101.
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