PERTH, March 23 /CNW/ - Mirabela Nickel Limited ("Mirabela" or the "Company") (ASX:MBN, TSX:MNB) is pleased to announce the publication of the Company's updated NI 43-101 Independent Technical Report, available on SEDAR at sedar.com and at www.mirabela.com.au, today and to present the key findings of the updated NI 43-101 Independent Technical Report.

Reserves and Resources

The January 2011 update for the Santa Rita Open pit resource is based upon the 2008 Resource, with mining depletion taken into account since the commencement of operations in November 2009 and has been reported using a lower grade cut-off than previously. The overall reserve has increased from 121 million at 0.60% nickel to 159.3 million tonnes at 0.52% nickel and consequently the life of mine has increased to 23 years, 2011 inclusive.

(Contained Ni: 829,800t (1,829Mlbs); Strip ratio: 5.0 to 1; weighted average recovery: 68.7% Ni) The competent person for the 2011 reserve update is Carlos Guzman of NCL.

The competent person for the 2011 resource update is Neil Inwood of Coffey Mining.

^{1 Based on a weighted average cut-off grade of 0.25% nickel.
2 As of [December 31, 2010].
3 Based on a weighted average cut-off grade of 0.50% nickel.
4 As of [December 31, 2010].}

Key Operating Parameters

Mining

Mining operations for 2011 will be focused on opening the open pit along its full strike length from North to South to provide maximum flexibility for the mining operation at full capacity. Pre-stripping of the Central pit is well underway with first ore production expected during the second quarter 2011. With the exception of an additional front end loader and four dozers, the majority of the core mobile equipment is on site.

Processing

The Independent Technical Report has verified that the expansion of the plant to a throughput of 7.2Mtpa is achievable in 2012. The upgrade of the primary crusher and process plant is modular and can be undertaken with minimal impact on existing operations. The second ball mill, filter and pebble crusher are already on site. The installation of the de-sliming circuit is expected to be completed during the fourth quarter of 2011. The Independent Technical Report has confirmed the proposed modifications to the processing plant to include de-sliming should allow the processing plant to achieve design (or better) nickel recoveries on a consistent basis.

Production

The ramp up of the Santa Rita Operation will continue throughout the year and production levels are expected to be stronger in the second half of the year as key components of the 7.2Mtpa expansion are completed and commissioned. The increased nickel production levels in 2011 and 2012 will be achieved through higher throughput, with the full benefits of the de-sliming circuit assumed to be evident post 2012.

Unit Cash Costs

The focus on mining pre-strip and the SAG mill engine failure in January 2011 means the first quarter's unit cash costs and production will not be reflective of the anticipated increase in production and consequent reduction in unit cash costs during the second half of the year. Ramp up inefficiencies and short term, higher cost contract mining operations have been factored in during 2011 and 2012 resulting in higher mining costs for those years.

Project Capital Expenditure

The estimated capital cost to complete the operational ramp-up is approximately US$50.0 million and includes the purchase of mobile fleet, the expansion of the plant and crusher to 7.2Mtpa and the installation of a de-sliming circuit. The capital cost estimate is based on component order costs, detailed and preliminary engineering estimates, management estimates, plus contingency. Capitalized mining costs are estimated at US$32.4 million for 2011. Project capital expenditure excludes regional tenement costs and exploration costs.

Net Project Cashflow

Net Project Cashflow estimates are based on assumed nickel prices of US$11/lb for 2011 and US$10/lb for 2012 and an assumed R$:US$ exchange rate of 1.80. Net project cashflow excludes: financing costs; regional tenement costs; exploration costs; and corporate costs.

Management Commentary

Commenting on today's announcement, Ian Purdy, CEO, said "The second stage ramp up of the Santa Rita operations is well underway to increase our ore mining and plant capacity to 7.2Mtpa. I am extremely pleased that we achieved all of our ramp up targets for 2010 and this gives me confidence that we can deliver this second stage ramp up during the course of this year.

The findings of Independent Technical Report re-affirm management's view on the robustness of the Santa Rita operation. The team is now focused on successfully completing the expansion which will cement Mirabela's position as a world class, long life, low cost nickel producer."

Competent Persons

The information in this report that relates to Mineral Resources for the Santa Rita Nickel Deposit is based on information compiled by Mr. Neil Inwood in 2011. The information in this report that relates to Metallurgical Results for the Santa Rita Nickel Deposit is based on information compiled by Mr Rod Smith in 2011. Both Messrs Inwood and Smith are Members of The Australasian Institute of Mining and Metallurgy. Messrs Smith and Inwood are Principal Consultants with Coffey Mining Pty Limited, the independent mining consultants engaged by Mirabela Nickel Limited. Messrs Smith and Inwood qualify as both a Competent Person as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' (JORC Code) and as a Qualified Person in accordance with NI 43-101. Messrs Smith and Inwood consent to the inclusion in the presentation of the matters and defined Resources and Metallurgical information based on their information in the form and context in which it appears.

The information in this report that relates to pre-mining Ore Reserves, Mining Production and Cost Estimation for the Santa Rita Nickel Deposit is based on information compiled by Mr. Carlos Guzmen who is a Member of The Australasian Institute of Mining and Metallurgy. Mr. Guzmen is a Mining Engineer, Principal and Project Director with NCL Brasil Ltda and is a consultant to Mirabela Nickel Limited. Mr. Guzman qualifies as a Competent Person as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' (JORC Code) and is a Qualified Person in accordance with NI 43-101. Mr. Guzmen consents to the inclusion in the presentation of the matters based on his information in the form and context in which it appears.

Forward Looking Information

Certain information in this announcement, including all statements that are not historical facts, constitutes forward-looking information within the meaning of applicable Canadian securities laws. Such forward-looking information includes, but is not limited to, information which reflect management's expectations regarding Mirabela's future growth, results of operations (including, without limitation, future production and capital expenditures), performance (both operational and financial) and business prospects (including the timing and development of new deposits and the success of exploration activities) and opportunities. Often, this information includes words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate" or "believes" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.

In making and providing the forward-looking information included in this announcement, the Company has made numerous assumptions. These assumptions include among other things: (i) assumptions about the price of nickel and other base metals; (ii) that there are no material delays in the optimisation of operations at the Santa Rita Operation; (iii) assumptions about operating costs and expenditures; (iv) assumptions about future production and recovery; (v) that the supply and demand for nickel develops as expected; (vi) that there is no unanticipated fluctuation in interest rates and foreign exchange rates; and (vii) that there is no material deterioration in general economic conditions. Although management believes that the assumptions made and the expectations represented by such information are reasonable, there can be no assurance that the forward-looking information will prove to be accurate. By its nature, forward-looking information is based on assumptions and involves known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance or achievements, or results, to be materially different from future results, performance or achievements expressed or implied by such forward-looking information. Such risks, uncertainties and other factors include among other things the following: (i) decreases in the price of nickel and copper; (ii) the risk that the Company will continue to have negative operating cash flow;; (iii) the risk that additional financing will not be obtained as and when required; (iv) adverse fluctuations in foreign exchange rates; (v) the risk that concentrate produced will not meet certain minimum specifications; (vi) material increases in operating costs; (vii) production estimates may not be accurate; (viii) environmental risks and changes in environmental legislation; (ix) adverse fluctuations in interest rates; * failure to comply with restrictions and covenants in the Senior Loan Agreement; (xi) risks arising from the Company's hedging activities; (xii) failure to comply with restrictions and covenants in the off take loan agreements; (xiii) changes in the terms of the Senior Loan in order to achieve successful syndication; and (xiv) changes in the terms of the Leasing Facility in order to achieve successful syndication.

The Company's MD&A and the annual information form contain information on risks, uncertainties and other factors relating to the forward-looking information. Although the Company has attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in the forward-looking information, there may be other factors that cause actual results, performances, achievements or events not to be anticipated, estimated or intended. Also, many of the factors are beyond the Company's control. Accordingly, readers should not place undue reliance on forward-looking information. All forward-looking information disclosed in this announcement is qualified by this cautionary statement.