NICKELPRODUCER

FOUNDED IN 1994, MINARA RESOURCES LIMITED OWNS AND OPERATES

THE MURRIN MURRIN NICKEL COBALT JOINT VENTURE PROJECT

(60% MINARA, 40% GLENCORE INTERNATIONAL AG) NEAR LEONORA

IN WESTERN AUSTRALIA’S HISTORIC NORTHERN GOLDFIELDS REGION.

MURRIN MURRIN IS A WORLD-CLASS HYDROMETALLURGICAL PROJECT,

UTILISING HIGH PRESSURE ACID LEACH (HPAL) TECHNOLOGY TO RECOVER

NICKEL AND COBALT FROM LATERITE ORES.

THE COMPANY HAS COMPLETED A SUCCESSFUL FINANCIAL RESTRUCTURE

AND IS NOW DEMONSTRATING STRENGTH AND VIABILITY, WITH AN

INCREASINGLY EFFICIENT PRODUCTION FACILITY. IT HAS EMERGED A

DIFFERENT COMPANY FROM ITS PREDECESSOR, WITH AN ENTIRELY ALTERED

FINANCIAL STRUCTURE, A CLEAN BALANCE SHEET AND MINIMAL DEBT.

MINARA IS WESTERN AUSTRALIA’S SECOND LARGEST NICKEL PRODUCER

WITH HEADQUARTERS IN PERTH, WESTERN AUSTRALIA.

THE MURRIN MURRIN NICKEL-

COBALT PROJECT AREA IS LOCATED

BETWEEN LEONORA AND LAVERTON

IN THE NORTH EASTERN GOLDFIELDS

OF WESTERN AUSTRALIA

MURRIN MURRIN

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PERTH

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NICKEL -A PRODUCTFOR LIFE

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CREATING APATHWAY FORTOMORROW’SFUTURE

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A FULLYINTEGRATEDPROCESS

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A SOCIALLYRESPONSIBLEOPERATOR

NICKELA PRODUCT FOR LIFE

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NICKEL END-USE GROWTH

1960 1970 1980 1990 2000 2010Tonnes

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000 OtherPlatingFoundryAlloys & SuperalloysAlloy SteelsStainless Steel

MINARA RESOURCES

NICKELFIRST USE

Given its industrial significance, it seemsextraordinary that the cobalt market is relativelysmall when compared with the major base metalsmarkets. Total supply is around 40,000 tonnes peryear. Another distinguishing feature of theWestern cobalt market is that the metal is derivedfrom a relatively small number of sources - just afew mines and processing plants, the US strategicstockpile, and Russian exports.

Minara is the second largest producer of nickel inWestern Australia and has a positive impact on thesocio-environment through employment, purchasingmaterials and services, and taxes and royalties.This also provides significant economic benefit tothe local community, with flow-on benefits such asincreased spend on infrastructure and services.

NICKEL AND COBALT HAVE BECOMEESSENTIAL MATERIALS USED AS PARTOF EVERYDAY LIFE.

NICKEL is primarily used in metal alloys,imparting toughness, strength, corrosion resistanceand various other electrical, magnetic and heatresistant properties.

At least 3000 nickel alloys have been created,with 65% of primary nickel consumed in theWestern world used in the production of stainlesssteel. Nickel alloys are widely used in thechemical, petrochemical, power, nuclear andaircraft industries.

More everyday uses include construction, cars(in highly stressed areas such as crankshafts andaxles), and common household products (kitchensinks, cooking utensils and washing machines).

Other important markets include nickel-cadmiumrechargeable batteries, used to power mobilephones, radios, clocks and calculators, coins whichcontain between 2% and 25% nickel andelectroplate steel or brass articles.

Nickel metal consumption is expected to growsteadily for the foreseeable future, given reasonablelevels of world economic growth, and after takingincreased stainless steel production into account.

Minara is well positioned to capture a share ofthis expanding market opportunity.

COBALT is of great strategic importance to theworld economy because of its diverse industrialand military applications. Its principal use is insuperalloys (25% of demand) and specialty andhigh-speed steels. Almost 50% of total cobaltconsumption is in chemical forms. This includesits uses as a catalyst in chemical production,in paint dryers, radial tyres, adhesives, batteries,animal feed additives, pigments and ceramics.Rechargeable batteries continue to be a stronggrowth area for cobalt consumption, particularlyas an additive in nickel cadmium (NiCd) and nickelmetal hydride (NiMH) batteries, and more recently,in the development of lithium ion batteries. Suchbatteries are widely used in cellular telephones,laptop computers and other high-tech, portableelectronic equipment. Batteries account for about10% of cobalt consumption.

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MINARA RESOURCES

CREATING A PATHWAY

FOR TOMORROW’SFUTURE

THE FUTURE OF NICKEL IS LATERITES

THEY MAY HAVE BEEN THE MAJOR SOURCE OF EARLY NICKEL, LATERITE ORES ASTHE PREFERRED SUPPLY WERE SUPERSEDED BY THE DISCOVERY OF SULPHIDENICKEL SOURCES. NOW THAT SULPHIDE NICKEL SOURCES DEPLETING, LATERITEORES ARE MAKING A STRONG COMEBACK. THE PREDICTION OF LATERITES AS THEFUTURE OF NICKEL PRODUCTION, PLACES MINARA IN AN ENVIABLE POSITION.

Although about 70% of world land based nickelresources are contained in laterites, they currentlyaccount for only 40% of the world nickel production.The advent of high pressure acid leachingtechnology (HPAL), coupled with insufficient growthof alternative nickel sources, has seen a shift inperception towards lateritic ore and it is anticipatedthat the two supply source types should be inbalance within the next few years.

Nickel laterite mineralisation is a geological termused to describe the concentration of nickel andcobalt in silicate minerals, most often clays, due toextensive weathering of olivine rich ultramafic rocks.

REALISING OUR POTENTIAL

Minara was one of the first nickel producers to investin laterite nickel and cobalt processing techniques.

Poor initial design coupled with the launch ofnew technology, resulted in delays in achievingname plate capacity. Minara has since investedsignificant time and resources to eliminate thebottleneck deficiencies and we are now on ourway to becoming one of the world’s leadingproducers of nickel and cobalt.

The journey has also allowed Minara to developa skill bank of engineering and metallurgicalexpertise that has an excellent understandingof Australian conditions and ore types.

Quite simply, we are overcoming the challengesthat our competitors are yet to face and haveestablished a platform for Minara to reap thebenefit from the potential growth in demand forlaterite ore production.

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MINARA RESOURCES

OPERATING FOR THE LONG-TERM

A substantial nickel deposit, Minara has65 million tonnes of proven reserves. It alsohas 68 million tonnes of probable reservesand 10 million tonnes of stockpile reserves(Source: June 2004 reserve statement).

The Murrin Murrin project has, in 2003/04,mined and processed 2.8 million tpa of lateriteore for the production of around 29,000 tpa ofnickel and 2,000 tpa of cobalt briquettes.

Plans are in place to increase the plantcapacity and production.

“SAFETY HAS UNCONDITIONAL PRIORITYIN ANY BUSINESS ACTIVITY. THE WORKENVIRONMENT AND WELL BEING OF OTHERSIS WITHIN OUR CARE.”

THIS IS ONE OF MINARA’S SIX COMMITMENTSDEVELOPED BY OUR EMPLOYEES TO REFLECTSHARED VALUES ACROSS ALL LEVELS OFOUR OPERATIONS.

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MINARA RESOURCES

MINARA IS COMMITTED TO ACHIEVINGHIGH STANDARDS IN ALL AREAS OFENVIRONMENTAL MANAGEMENT.INVESTING SIGNIFICANT TIME ANDEXPERTISE TO MANAGE THE REDISCOVERYOF THE PRESUMED EXTINCT PLANTHEMIGENIA EXILIS WAS RECOGNISEDEXTERNALLY AS A COMMITMENT TOENVIRONMENTAL EXCELLENCE.

A FULLY

INTEGRATEDPROCESS

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MINARA RESOURCES

MINING AND REHABILITATION

Minara’s aim after mining is to re-establish allpre-existing land uses prior to mining. As partof this approach, extensive environmentalsurveys are undertaken prior to mining to assessenvironmentally sensitive areas and minimiseimpacts. This information is critical to successfullyrehabilitating mining areas.

The laterite ore mined by Minara is relativelyshallow, averaging 40 to 60 metres in depthand is located usually less than one metre belowthe soil surface. Due to its soft clay-like nature,the ore is recovered through open cut miningmethods. The mining reserves are located atMurrin Murrin North and South and Murrin MurrinEast (40 kilometres east of the project site).Combined, they have a proved and probable reserveof 1.57 million tonnes of nickel and 124 thousandtonnes of cobalt, ensuring a project life of at least30 years (Source: June 2004 reserve statement).

The topsoil and clay overburden is mechanicallyexcavated and used on a newly rehabilitated areaor placed in a stockpile.

The geology has been classed intothree areas:

Ferruginous zone – the top laterite unit containsmainly iron oxides as waste. A small amount ofnickel-cobalt mineralisation appears at the baseof this zone.

Smectite zone – the middle laterite unit containsmainly smectite clays and medium to high gradenickel-cobalt mineralisation.

Saprolite zone – the bottom laterite unit containsmainly primary smectite clays and basic mineralsreferred to as serpentine minerals. The grade ofnickel-cobalt mineralisation varies significantly.

Excavators are used to extract the ore and dumptrucks are used to transport it and the waste torespective stockpiles.

Since operations commenced, some 283 hectaresof land has been rehabilitated with the aim ofestablishing a self-sustaining cover of nativevegetation. Minara aims to attain natural levels ofspecies and plant densities in all restored sites.

MINARA IS THE ONLY FULLY INTEGRATED NICKEL LATERITE PRODUCER IN THEWORLD. THE HYDROMETALLURGICAL PROCESS IS SIMPLIFIED BELOW:

• MINING AND REHABILITATION

• ORE PREPARATION

• HIGH PRESSURE ACID LEACHING

• SOLID-LIQUID SEPARATION - COUNTER CURRENT DECANTATION (CCD)

• SOLUTION NEUTRALISATION

• MIXED SULPHIDE PRECIPITATION

• TAILINGS NEUTRALISATION

• OXYGEN RE-LEACH OF NICKEL AND COBALT VALUES

• NICKEL AND COBALT SEPARATION

• NICKEL AND COBALT REFINING

• METAL PACKAGING

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MINARA RESOURCES

THE MURRIN MURRIN PROJECT INVOLVES CONVENTIONAL OPEN PIT MININGFOLLOWED BY ORE PREPARATION, HIGH PRESSURE ACID LEACH, SOLUTIONNEUTRALISATION, MIXED SULPHIDE PRECIPITATION, NICKEL & COBALT REFININGAND NICKEL & COBALT PACKAGING.

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MINARA RESOURCES

THE INTEGRATED HYDROMETALLURGICAL PLANT REQUIRES KEY UTILITIESSUCH AS SULPHURIC ACID, HYDROGEN, OXYGEN, HYDROGEN SULPHIDE,POWER, STEAM AND WATER.

THE PROCESS IS EXPLAINED IN GREATER DETAIL ON PAGES 8 TO 11.

ORE PREPARATION

After mining, the ore is transported to the ROM(Run of Mine) pad where it is sorted according tograde and blended to ensure consistent feed tothe leaching circuit. Part of this process involvescrushing the ore to less than 150mm using a MMDsizer (a spiked rolls crusher).

Water is added to the SAG mill to produce a milldischarge slurry stream. The slurry is discharged overa primary vibrating screen. The larger particles withlower nickel or cobalt content are removed from theprocess as rejects. The slurry is then discharged ontosecondary screens. Part of the screen underflow iscycloned and thickened whilst the secondary screenreject material is combined with the primary screenreject material and stockpiled.

The slurry is then pumped to holding tanks.The holding tanks allows for minor interruptionsto the supply of ore until it is pumped intothe acid leach section.

HIGH PRESSURE ACID LEACHING

The high pressure acid leach circuit consistsof four large titanium lined autoclaves.

The slurried ore, grading approximately 1.35%nickel and 0.09% cobalt, is preheated prior toentering the autoclaves. Concentrated sulphuric acidis added to the first of six compartments within theautoclave. The 4 autoclaves typically operate at255°C and 44 bar (or atmospheres) pressure.

As the slurry passes through the autoclaves,the nickel and cobalt is converted to solublesulphate salts over a period of 90 minutes.

ENERGY IS RECOVERED FROM THE AUTOCLAVE FLASH SYSTEM BY PRE-HEATINGFEED SLURRY, ENHANCING THROUGHPUT AND MINIMISING THE OVERALLENERGY REQUIRED PER TONNE OF ORE.

ENERGY

THE POWER AND STEAM GENERATION PLANT IS MADE UP OF TWO STEAMTURBINES, ONE GAS TURBINE, THREE NATURAL GAS BOILERS, SIX STANDBY DIESELGENERATORS AND ASSOCIATED MECHANICAL AND ELECTRICAL EQUIPMENT.

MINARA’S ENERGY REQUIREMENTS ASSISTED TO ENSURE THE ECONOMICVIABILITY OF THE GAS PIPELINE TO THE REGION.

THE SULPHURIC ACID PLANT AT MURRIN MURRIN IS ONE OF THE LARGESTIN THE WORLD. THE PLANT PRODUCES ACID FOR THE HPAL CIRCUIT.ITS SECONDARY FUNCTION IS TO PROVIDE HIGH-PRESSURE STEAM FORTHE PROCESS PLANT AND FOR POWER GENERATION.

WATER SUPPLY AND TREATMENT

WATER IS AN ESSENTIAL PART OF THE PROCESS AND AN EXTENSIVE COMPANYOWNED BOREFIELD NETWORK SUPPLIES THE PLANT WATER REQUIREMENTSFROM UP TO 50KM AWAY. RAW WATER MUST BE TREATED BY REVERSE OSMOSISTO PRODUCE DEMINERALISED AND POTABLE WATER. APPROXIMATELY ONE-THIRDOF THE WATER IS TREATED VIA THE WATER TREATMENT PLANT.

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MINARA RESOURCES

A B

SOLID-LIQUID SEPARATION

At this stage, the ore has now been leached andthe nickel and cobalt are in a soluble form and mustbe recovered from residue. To effect this, slurry ispumped to the counter-current decantation (CCD)circuit. The function of this circuit is to wash thepressure leach residues and to recover solublenickel and cobalt. The CCD circuit consists of seven50 metre thickeners. The thickeners separate theslurry into two streams by settling the residuesolids and decanting the soluble nickel and cobaltsulphate solution.

Each thickener acts as a washing stage whichconsists of a mixing (washing) operation followedby a solid/liquid separation (thickening) operation.

The washed slurry underflow (which containsall the residue solids) from the last thickener ispumped to the tailings neutralisation circuit priorto disposal into the tailings dam.

The clarified liquor (which contains dissolvednickel and cobalt sulphates) from the first washthickener is stored prior to solution neutralisation.

SOLUTION NEUTRALISATION

The function of the solution neutralisation circuitis to neutralise the free acid in leach solution.The free acid must be neutralised prior to thehydrogen sulphide precipitation circuit in orderto maximise nickel and cobalt recovery.

The first step is to mix hydrogen sulphide with thesolution from the first wash thickener to reduceferric iron to ferrous iron and chromate to chromium.

The solution then flows through a series of fouragitated tanks where calcrete slurry is added toreact with the free acid to form gypsum (calciumsulphate precipitate).

The pressure leach solution (PLS) is separatedfrom the gypsum precipitate in the neutralisationthickener. The clarified overflow is sent to thesulphide precipitation section for further treatment.The thickener underflow solids are discharged backto the CCD circuit to recover the small amount ofcontained soluble nickel and cobalt sulphate andallow the gypsum to be discharged with theresidue for disposal into the tails dam.

CALCRETE, WHICH IS SIMILAR TO A LOW GRADE LIMESTONE, IS USED TONEUTRALISE THE ACID IN THE PROCESSING PLANT. CALCRETE IS MINED FROMWITHIN EXISTING TENEMENT HOLDINGS AND HAULED 50KM TO THE PLANT SITE.CALCRETE RESOURCES CURRENTLY TOTAL 95 MILLION TONNES, EQUIVALENTTO 70 YEARS SUPPLY.

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MINARA RESOURCES

C D

MIXED SULPHIDE PRECIPITATION

The purpose of the mixed sulphide precipitationcircuit is to separate and recover nickel andcobalt from solution and into a solid form. This isachieved by the chemical process of precipitation.

Hydrogen sulphide gas is injected into high shearreactors with mixed sulphide seed to precipitatemetal values as a nickel and cobalt sulphide.Downstream reactors ensure sufficient retentiontime to effect 98.5% nickel and 96.5% cobaltprecipitation efficiency.

The mixed sulphide precipitate is then settled outof the solution in a thickener. The thickened slurryis filtered, washed and stored prior to furthertreatment in the refinery or it can be sold directon market.

The barren solution is recycled to the CCD circuitas wash liquor.

TAILINGS NEUTRALISATION

The purpose of the tailings neutralisation circuit isto neutralise the slurry from the CCD circuit priorto disposal in a tailings dam.

This is achieved through the addition of calcreteslurry in agitated tanks. Neutralised tailings arepumped to the tailings dam where the solidssettle and decanted liquor gravitates to theevaporation pond.

SULPHUR IS A MAJOR CONSUMABLE USED IN THE PRODUCTION OF ACID ANDHYDROGEN SULPHIDE GAS AND IS SUPPLIED UNDER LONG-TERM AGREEMENTSWITH SHELL CANADA AND PETROSUL, AS WELL AS SPOT PURCHASES.ARRANGEMENTS ARE IN PLACE FOR 7 TO 8 PANAMAX (APPROX 65,000MT)SHIPMENTS PER YEAR TOTALLING APPROXIMATELY 500,000 TONNES.THE SULPHUR IS SHIPPED TO KWINANA AND TRANSFERRED BY RAIL TOMALCOLM RAIL SIDING AND THEN BY ROAD TO SITE.

TAILINGS STORAGE

ALL MATERIAL THAT IS SEPARATED DURING THE PRODUCTION PROCESS ISMANAGED AND MONITORED WITHIN OUR TAILINGS STORAGE AREAS. IMMEDIATEAND LONG-TERM MANAGEMENT OF TAILINGS IS AN ENVIRONMENTAL PRIORITYFOR MINARA. WE HAVE WORKED IN COLLABORATION WITH LEADING ENGINEERSTO PROVIDE INNOVATIVE SOLUTIONS TO TAILINGS MANAGEMENT, AIMED ATREDUCING ENVIRONMENTAL IMPACTS. DISPOSAL INTO MINED OUT PITS IS ALSOUNDER REVIEW AS AN OPTION.

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MINARA RESOURCES

E F

OXYGEN RE-LEACH OF NICKELAND COBALT VALUES

The nickel and cobalt refinery processes mixedsulphide precipitate to produce high purity nickeland cobalt powder and briquettes. A summary ofthe refining unit processes is described below.

Washed sulphide precipitate is finely ground.The sulphide is re-leached in an autoclaveunder oxygen overpressure. The leaching timeis 90 minutes and achieves >99.5% nickel andcobalt extraction.

The autoclave slurry is discharged to the impurityremoval circuit where ammonia and air is addedto remove iron. Trace copper is removed fromsolution using recycled “strip” sulphides.Solid/liquid separation steps removes solidsthrough thickening and filtration.

Precipitate solids are recycled to the HPAL circuitto recover nickel and cobalt.

DURING THE IRON REMOVAL PROCESS, A SMALL AMOUNT OF NICKEL IS CO-PRECIPITATED. PRECIPITATED SOLIDS ARE THICKENED AND RECYCLED BACKINTO THE PROCESS VIA ORE LEACH FEED.

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MINARA RESOURCES

G

NICKEL AND COBALT SEPARATION

The impurity free liquor is then pumped to thesolvent extraction circuit where an organic reagentCyanex 272 in diluent is used to extract first zinc,which is stripped and sent out to tails, followed bycobalt extraction. Cobalt is preferentially loaded inthe organic, ensuring separation of cobalt fromnickel. The organic is then stripped and dischargedto the cobalt hydrogen reduction circuit whilst thenickel raffinate is discharged to the nickelhydrogen reduction circuit.

NICKEL AND COBALT REFINING

Anhydrous ammonia and ammonium sulphate isadded to both the high strength pure cobalt andnickel solutions prior to hydrogen reduction.

The nickel ammonium sulphate liquor is preheatedprior to entering the nickel hydrogen reductionautoclaves. Hydrogen gas is introduced underpressure and the nickel is precipitated as apowder. The powder is recovered from the bulkliquor via a flash tank, pan filter and dryer.

AMMONIUM SULPHATE

Ammonium sulphate in barren liquor from thehydrogen reduction autoclaves is recovered forsale in a 3-stage evaporation process.

METAL PACKAGING

Dry nickel ore is briquetted and sintered prior topackaging 99.8% (LME) specification product andis delivered to markets around the world.

Cobalt recovery follows essentially the sameprocess as nickel.

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MINARA RESOURCES

MINARA CONDUCTS BUSINESSWITH RESPECT AND CARE.WE TAKE PRUDENT STEPS TOMINIMISE IMPACTS OUR BUSINESSMAY HAVE ON THE LOCAL ANDGLOBAL ENVIRONMENT BYBALANCING SOCIAL, ECONOMICAND ENVIRONMENTAL NEEDS.

SAFEGUARDING FOR A HEALTHY WORKPLACE

MINARA IS COMMITTED TO IMPROVING SAFETY OUTCOMES FOR ALL INDIVIDUALSASSOCIATED WITH THE COMPANY, INCLUDING SUPPLIERS, EMPLOYEES,CONTRACTORS AND VISITORS.

We believe that all injuries can be prevented.As part of our preventative safety program, weidentify technological solutions, engineering oradministrative controls to reduce exposure tochemical and physical hazards.

We are also conscientiously improving our healthand safety awareness through initiatives such as abehavioural safety system, fitness for work,emergency response, hygiene monitoring andhealth surveillance.

Whilst we acknowledge that we have comea long way and that our efforts are paying off,we know our safety obligation leaves us with noroom for complacency.

PRESERVING THE ENVIRONMENT

In producing nickel and cobalt, our approach is todevelop a production cycle that reflects practicaland sustainable development. We are committedto engage in best practice environmentalmanagement techniques.

We are establishing an EnvironmentalManagement System in accordance with ISO14000 to ensure that environmental impacts areidentified, assessed and managed effectively.In addition, Environmental Management Plansare produced for all major projects to ensurewe observe and monitor environmentalrequirements at all stages of our operations.

RESPECTING OUR EMPLOYEES

The Minara workforce is made up of almost1000 permanent people.

We aim to engender a working environment wherecultural and personal differences are valued,

where the needs of employees to balance work andpersonal demands are respected, and where thereare equal opportunities for people to progress.

Our aim is to build a performance-orientated culture,where employees identify with their role and wheretheir contributions are valued and recognised.

REGIONAL DEVELOPMENTS

Minara’s presence in the region has resulted inregional infrastructure and project infrastructureto support the operation. The regional infrastructureincludes upgrades to local roads and improvedemergency services. The project infrastructureincludes site buildings, an airstrip accommodationvillage and amenities and plant roads.

Additionally, Minara has continued to supportcommunities near its operations through involvementin local community events, sponsorships anddonations. Initiatives primarily focus on promotinghealth, safety and youth development within localschools and community organisations.

Minara has also developed a strong partnershipwith emergency service operator The Royal FlyingDoctor Service. A five year partnership hasproduced improvements in emergency serviceprovisions for the greater region.

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MINARA RESOURCES

A SOCIALLYRESPONSIBLE

OPERATOR

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Level 4, 30 The EsplanadePerth, Western Australia

PO Box Z5523St George’s TerracePERTH WA 6831

Telephone (08) 9212 8400Facsimile (08) 9212 8401

info@minara.com.au

ONLY 250 YEARS AGO, THIS NATURALLY OCCURRINGMETAL WAS UNKNOWN TO US AS A UNIQUE ELEMENT.IN THE RELATIVELY SHORT PERIOD OF TIME FOLLOWINGITS ISOLATION AND NAMING, WE HAVE DEVISED SO MANYWAYS TO USE NICKEL THAT WE’VE HAD TO DEVISE EVERINNOVATIVE WAYS TO LOCATE, EXTRACT, AND REFINE ITIN ORDER TO SATISFY OUR GROWING DEMAND.

SOURCE: NICKEL INSTITUTE

www.minara.com.au