Mirabela Nickel Limited - Quarterly Activity Report for the Period Ended 30 June 2013

Mirabela Nickel Limited - Quarterly Activity Report for the Period Ended 30 
June 2013 
PERTH, Australia, July 23, 2013 /CNW/ - Mirabela Nickel Limited ("Mirabela" or 
the "Company") (ASX: MBN, TSX: MNB) is pleased to announce its unaudited 
second quarter results for the period ended 30 June 2013. 

    --  Production for the quarter of 4,080 tonnes of nickel in
        concentrate (Q1 2013: 4,151 tonnes)
    --  Sales for the quarter of 4,168 tonnes of nickel in concentrate
        (Q1 2013: 3,907 tonnes)
    --  Unit cash costs of US$5.84/lb for the quarter (Q1 2013:
    --  First half production of 8,231 tonnes of nickel in concentrate
        at an average unit cash cost of US$5.48/lb
    --  Average mined nickel grade of 0.50% for the quarter (Q1 2013:
        0.48%) and total mining material movement of 10.4 million
        tonnes (Q1 2013: 8.5 million tonnes)
    --  Processing plant throughput of 1.7 million tonnes (Q1 2013: 1.6
        million tonnes)
    --  Average processing plant nickel recovery of 51% (Q1 2013: 56%)
        and average nickel feed grade of 0.47% (Q1 2013: 0.47%) for the
    --  Cash on hand and on deposit of US$108 million at quarter end
        (Q1 2013: US$141 million)


Mirabela's second quarter saw the open pit material movement return to 
expected levels with the successful reconfiguration of the excavator fleet. 
Remediation works on the primary crusher and the remediation of the 
geotechnical fault zone, between the central zone and south zone of the open 
pit, progressed to plan during the quarter. Nickel production continued to be 
restricted by ore quality limitations.

The Company provided updated guidance for 2013 with production expected to be 
17,000 to 18,500 tonnes of nickel in concentrate; capital expenditure, 
exploration and study costs at between US$35 million and US$45 million; and 
unit cash costs expected to average between US$5.00/lb and US$6.00/lb for the 


Mirabela's strong safety performance continued with no lost time injuries 
during the quarter. The Company's 12 month moving average Lost Time Injury 
Frequency Rate closed the quarter at 1.12. Mirabela continues to target 
further improvements to this strong safety record through ongoing safety 
training and safety improvement programmes. The Company completed a 
comprehensive safety review and third party audit with DuPont during the 
quarter. The audit has highlighted areas for further improvement which will be 
implemented with the assistance of DuPont.

Production Statistics
                      Three    Three months    % change
                     months                                Year to Date
                                  ended      favourable/
                      ended                                    2013
                               31 Mar 2013  (unfavourable)
                   30 Jun 2013


Material    Tonnes 10,387,040    8,498,282           22     18,885,322

Ore Mined   Tonnes  1,661,192    1,164,561           43      2,825,753

Nickel         %        0.50         0.48            4           0.49


Total Ore   Tonnes  1,695,559    1,579,963           7       3,275,522

Nickel         %        0.47         0.47            -           0.47

Copper         %        0.10         0.10            -           0.10

Cobalt         %        0.02         0.02            -           0.02

Nickel         %         51           56            (9)           53

Copper         %         65           71            (8)           68

Cobalt         %         27           29            (7)           28


Nickel in     DMT      4,080        4,151           (2)         8,231

Copper in     DMT      1,125        1,169           (4)         2,294

Cobalt in     DMT        71           72            (1)          143


Nickel in
Concentrate   DMT      4,168        3,907            7          8,075

Copper in
Concentrate   DMT      1,143        1,119            2          2,262

Cobalt in
Concentrate   DMT        71           69             3           140

((1) )Includes sales volume adjustments upon finalisation of assays.


Total material movement for the quarter was 10.4 million tonnes of material 
moved for 1.7 million tonnes of ore. Material movement was in line with 
expectations with the result driven by improved excavator performance 
following the outsourcing of excavator services to U&M during April 2013. The 
higher excavator availability and volumes were achieved using U&M's two 
Hitachi 2600 excavators which were fully commissioned during the quarter. Both 
machines have performed above expectations in terms of tonnes mined per hour 
and total material movement, and realised additional benefits such as savings 
on ground engaging tools, fuel and lubrication. The improved excavator 
performance allowed the Company to park-up its underperforming O&K excavator 
fleet during the quarter. The removal of the excavators from the open pit 
has resulted in less congestion and larger mining areas.

Mine grades of 0.50% were marginally higher than the previous quarter although 
ore quality remained below expectations due to elevated levels of MgO, (over 
30%), continuing in the central zone ore. Remedial works to remove the 
geotechnical fault between the South and Central zones advanced as planned 
during the quarter with access to the South pit re-established for the second 
half of the year.

In late June 2013, a disruption to the supply of nitrate in Brazil restricted 
the supply of explosives to the Company, severely limiting material movement 
and ore production in the open pit. Restricted mining operations have 
continued during July with a return to normal nitrate deliveries expected 
towards the end of July.


During the quarter 1.7 million tonnes of ore was milled, at an average head 
grade of 0.47% nickel and achieving an average recovery of 51%. Ore quality 
limitations were the most significant limitation on nickel production levels. 
Recovery performance remained in line or above the expected grade vs. recovery 
algorithm for processed ore quality due to continued improvements in the 
process plant setup and the reagent regime.

The marginally lower than target processing plant throughput was primarily 
driven by ongoing remediation work on the primary crusher. The Company 
continues to work with Metso Brazil and Lycopodium to improve the performance 
of its gyratory crusher and resolve stress problems in the civil footings. 
During the quarter the primary crusher was stood down for 72 hours to inspect 
and repair the pinion end float. Metso supervised the repair of the pinion 
which has now been rectified and reinstalled. An inspection of the crusher 
casings was also undertaken, revealing no cracks but with some remediation 
work required to remove potential stress raisers. Inspection of the civil 
footings revealed that some redressing of the concrete footings would be 
required and that this work could be done insitu with no existing concrete 
required to be removed. The remaining remediation work on the primary crusher 
is estimated at 30 days and is planned to be performed via two shutdowns of 15 
days each during the third and fourth quarters of 2013. The Company plans to 
optimise throughput during this time by maintaining sufficient crushed ore 
stockpile prior to the shutdowns and maximising the throughput of the second 
line crusher.

During the quarter Mirabela produced 4,080 tonnes of contained nickel in 
concentrate, 1,125 tonnes of contained copper in concentrate, and 71 tonnes of 
contained cobalt in concentrate. 4,168 tonnes of nickel in concentrate was 
sold to Mirabela's off-take partners, Votorantim Metais Niquel S.A. and 
Norilsk Nickel. One export shipment to Norilsk Nickel was completed during the 
quarter with steady deliveries to Votorantim continuing.

Exploration & Studies

Exploration activity for the quarter continued to focus on tenement 
maintenance only. Growth activities remain deferred in order to preserve cash.

Unit Cash Costs
                            Three     Three      % change      Year to
                           months    months                      Date
                            ended     ended                      2013
                          30 Jun 13 31 Mar 13                      

Payable Nickel       Lbs  8,005,416 8,144,726         (2)    16,150,142

Production Costs                                                    

Mining Cost        US$/lb    3.44      2.50          (38)        2,98

Processing Costs   US$/lb    1.69      1.69            -         1.69

Administration     US$/lb    0.65      0.57          (14)        0.61

Subtotal           US$/lb    5.78      4.76          (21)        5.28

Selling Costs                                                       

Transport/Shipping US$/lb    0.16      0.13          (23)        0.15

By-Product Credit( US$/lb   (1.42)    (1.23)           15       (1.33)

Smelter Charges    US$/lb    1.32      1.44            8         1.38

Subtotal           US$/lb    0.06      0.34            82        0.20

C1 Unit Cash Cost  US$/lb    5.84      5.10          (15)        5.48

Unit Royalty Cost  US$/lb    0.33      0.40            18        0.36

Realised Nickel    US$/lb    7.27      7.82           (7)        7.54

Realised Copper    US$/lb    2.99      3.49          (14)        3.23

Realised Cobalt    US$/lb    10.83     9.49            14       10.11

Average US$/Real             2.07      2.00            3         2.03
Exchange Rate

((1))     Average payability of 89%

((2))     Including prior period QP adjustments  

Mirabela recorded a C1 unit cash cost for the second quarter of US$5.84/lb, 
taking the average unit cash cost for the first half of the year to US$5.48/lb.

Unit mining costs per payable pound were higher in the second quarter 
primarily due to the higher level of mining activity during the quarter and 
lower capitalised mining costs. Total mining costs per tonne were steady 
quarter on quarter, (Q2: US$3.03/tonne versus Q1: US$3.06/tonne). Higher 
explosive costs, (due to higher nitrate prices), mining staff redundancies and 
higher usage of tyres were offset by improved efficiencies associated with the 
new excavators. Selling costs for the quarter were favourably impacted by PGM 
by-product credits.

The realised nickel price for the quarter was favourably impacted by the 
finalisation of prior period sales invoices which were subject to arbitration 
for a period of time.


Cash and Debt

Mirabela closed the second quarter with cash on hand and on deposit of 
US$108.12 million.The decrease in cash on hand from 31 March 2013 (US$140.80 
million) included an unfavourable foreign exchange movement of US$10.99 
million upon the conversion of closing BRL and AUD held cash into the 
Company's presentational currency (USD). The remaining decrease in cash on 
hand was driven by: an interest payment of US$17.28 million on the senior 
unsecured notes; budgeted capital expenditure of US$8.32 million; and the 
repayment of US$2.04 million relating to the Caterpillar finance lease 
facility. This cash outflow was offset in part by the finalisation of nickel 
sales that occurred in August, November and December 2012 at an average 
finalisation price of US7.96/lb compared to an average provisional price of 
US7.45/lb (US$2.42 million) and positive cash flow from operations.

Share Capital

As at 30 June 2013 the Company's issued share capital consisted of 876,801,147 
ordinary shares. A balance of 4,150,000 unlisted options and 5,091,810 
performance rights were outstanding.

The Company issued 36,053 shares during the quarter as a result of the 
conversion of 36,053 performance rights into shares. During the quarter 
1,166,434 performance rights were cancelled and 5,832 performance rights were 
forfeited in accordance with the Mirabela Nickel Ltd performance rights plan. 
Additionally, 4,609,547 performance rights were issued pursuant to the 
Mirabela Nickel Limited 2013 performance rights plan, approved by shareholders 
on 30 May 2013.

No options were exercised during the quarter. 

SOURCE  Mirabela Nickel Ltd. 
Chris Els Chief Financial Officer & Company Secretary Telephone: +61 439 930 
333 shanik@mirabela.com.au 
Ian Purdy Chief Executive Officer & Managing Director Telephone: +61 410 491 
908 shanik@mirabela.com.au 
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