Australian firm Rusina Mining NL said the pre-feasibility study of its Acoje nickel project in Zambales province, northwest of Manila, had been completed and forecast yearly sales of $260 million based on a long-term nickel price of $6 a pound.

Rusina Mining said in a statement that the study results showed an economically viable nickel laterite project, which will use heap leach technology to recover 24,500 tons of nickel and 930 tons of cobalt a year.

The company said that it, along with joint venture partner European Nickel Plc, will start a definitive feasibility study to confirm the findings that should be completed by late 2009.

The recently completed study, which is based on an indicated resource of 30.76 million tons of material with 1.12 percent nickel and 0.05 percent cobalt, puts the initial mine life of Acoje at 10 years.

Further, Acoje’s total development cost was estimated at $498 million, including infrastructure and working capital, while payback period was pegged at three years.

“Mining will be at a rate of three million tons per year,” Rusina Mining said. “Further potential resources have been identified which are expected to extend the mine life beyond 20 years and are expected to be confirmed during the DFS.”

“It is proposed that the nickel laterite ore will be leached with dilute sulfuric acid produced from a sulfur burning acid plant to be built at the site,” the company added.

“The nickel will be recovered in a precipitation plant in a two-stage concentration process producing two saleable products,” it said.

Rusina Mining said the potential development and commercial mining operation at Acoje will have a significant positive economic impact on Zambales and the surrounding region since about half of the construction costs are estimated to be spent within the area.

Of the $498 million in total development cost, an estimated 70 percent will be spent in the Philippines.

Under the firm’s so-called three-tiered Acoje strategy on nickel, Rusina is to develop short-term cash flow through the direct shipping of nickel laterite ore, which it has been doing.

The strategy provides that, in the medium-term, the company would partner with DMCI on ferronickel smelting operations with an electric arc furnace.

Still later, Rusina is to develop long-term, low-cost and sustainable mining through heap leach with the London-based European Nickel.

Rusina Mining is jointly investigating with DMCI the feasibility of putting up a calcine kiln/electric arc facility and considering four options in processing nickel laterite ore.