Australian Mines

Share Price

Current Share Price

$0.020 (0 traded)

Visit ASX Website
Prices are delayed by 20 minutes

7 July 2008

ASX Announcement

Company Update

STRONG QUARTERLY RESULT AT BLAIR NICKEL MINE, W.A.

Australian Mines (ASX: AUZ) has achieved a quarterly production result of 450 contained nickel tonnes for the June 2008 quarter at the 100%-owned Blair Mine, located 32 kms from Kalgoorlie in W.A

The result is the highest result since the June 2005 Quarter and is up 6% from the previous quarter and up 90% for the corresponding quarter last year.

Commenting on the result,Chief Operating Officer Brett Young said, “Operating performance at the Blair Mine continues to excel with the Blair Deeps orebody outperforming ore reserves estimates.

Also we are advancing the nearby Goodyear Project, at which we recently reported a maiden 16,000t Ni Inferred Mineral Resource to the depth of drilling.”

A new Resource and Reserve Statement for the company will be released in the current quarter which will incorporate results from the recent Blair Deeps drilling program.

Deferral of capital decline development program

Due to the recent fall in the nickel price to below US$22,000/tonne, the company has decided to defer its capital decline development program at the Blair Mine.

“Blair’s excellent production result has been partially offset by our decision to defer the capital development program. However,the decision enables the company to reduce operating costs at a time of lower nickel demand, with a view of re-commencing the program down the track.

“Given the increased number of high grade stopes now in production, we are well positioned to maintain production levels for at least the next 12 months,” Mr Young added.

At the end of the June2008 Quarter, future production without further decline development is forecast to exceed 60,000 tonnes at 2.7% Ni for 1,600 tonnes of contained nickel metal.

Australian Mines wraps up acquisitions of two advanced nickel projects

During the June 2008quarter, the Company completed the purchase of East Location 45 with the final payment of $1.5m to Harmony Gold Australia. The total purchase consideration was $3m in cash. Initial new extensional diamond drilling and down-hole surveys of historical drill holes of the Goodyear project has commenced and results will be announced in the September Quarter.The previously announced resource for the Goodyear Project is an Inferred Resource of 387,000 tonnes @ 4.13% Ni for 16,000 tonnes of nickel metal.

The Marriott’s nickel project located 70 kms from Leinster was also acquired in the financial year end June 2008 providing the Company with another quality nickel asset. The project has previously reported an Indicated and Inferred resource of 830,000 tonnes @1.13% for 9,400nickel tonnes.

For further information contact:

Brett Young

Chief Operating Officer

Australian Mines Limited

Tel: 08 9481 5811

For media enquiries contact:

Robert Williams

Farrington National

Tel: 02 9332 4448

The information in this report that relates to Mineral Resources is based on information compiled by Mr M Elias who is a Fellow of The Australasian Institute of Mining and Metallurgy. Mr Elias is employed by CSA Australia Pty Ltd and is a Non-Executive Director of AUZ. Mr Elias has sufficient experience which is relevant to the style of mineralisation and type of deposits under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.’

Email Subscription