TIR titan resources limited

TIR- feasability study confirms economics

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    TIR : Feasibility StudyConfirmsEconomics of BioHeap Nickel Process
    ASX Report
    11:32:0248 28/05/2002 Issuer: TIR

    HOMEX - Melbourne

    Titan Resources NL is pleased to report that it has completed a
    detailed, pre-feasibility cost analysis of the exploitation of two
    small, low-grade nickel sulphide deposits in northern Western
    Australia. The results have strongly endorsed the economic benefits
    of the Company's proprietary BioHeap(TM) bacterial leaching process.

    The economic study has confirmed that the BioHeap(TM) process can
    significantly reduce the capital and operating costs of the treatment
    of nickel sulphide ores and facilitate the production of nickel, at
    a genuinely competitive cost, from low-grade deposits that otherwise
    would not be viable using traditional metallurgical processes.

    The key factors are surnmarised below:

    * Mining rate of 400,000 tonnes per year; over 2 year life.
    * Based on low-grade nickel mineralisation, grading 0.78% Ni, and 1%
    * Capital cost estimated at A$15 million - equivalent to U$1.50 per
    pound of nickel produced per annum.
    * Cash cost of production (equivalent C1) of US$1.36 perpound of
    nickel, after copper and cobalt credits.
    * BioHeap(TM) unit treatment costs of US$0.58 per pound of nickel
    after by-product credits.

    The unit processing costs quoted are very much a function of ore
    grade and annual throughput and will be lower for higher nickel
    grades and/or larger operations.

    The study was carried out on the disseminated 'halo' mineralisation
    overlying the Company's Radio Hill massive sulplude deposit and on
    the Mt Sholl nickel deposit, ten kilometres to the north. The primary
    purpose was to identify the cost structure of the BioHeap(TM) process
    route, with particular reference to a mineralised deposit at the
    'low-value' end of the Spectrum.

    The Company considered that the short mine life of the Radio Hill
    deposit, and the consequent difficulty in obtaining non-recourse
    financing, has rendered this project unsuitable as the "first"
    commercial BioHeap(TM) operation. Consequently, Titan will now focus
    its efforts on the development of its wholly owned Carr Boyd Rocks
    and Widgiemooltha North deposits, both of which have the potential to
    be significantly bigger and of longer life than Radio Hill.

    The Company's efforts will also be concentrated on detailed
    assessment of its much larger potential joint-venture projects.

    At Radio Hill the extractable resource of disseminated mineralisation
    comprises less than one million tonnes at an average grade of 0.78%
    nickel and 1% copper. The study was based on an operation of two
    years duration, with ore accessed via the existing decline.

    The project flow sheet for this small operation was based on the use
    of a metal-specific ion exchange resin for recovery of the nickel and
    cobalt. While the ion exchange method of metal recovery is in the
    final stages of testing at the Radio Hill pilot plant site, the
    results are extremely promising, with the system ideally suited to
    the unique nature of the BioHeap(TM) process.

    Total capital cost for the venture was estimated at A$15 million,
    including preparation of the leach pads, bacteria breeding facilities
    and ion exchange/precipitation equipment. This capital cost equates
    to a unit-comparison figure of less than US$2 per pound of nickel
    produced per annum (US$1.50 in this particular case).

    The cash cost of production (equivalent to the C1 cost, adjusted for
    the actual payment terms received for the nickel product) is
    estimated at US$1.36 per pound of contained nickel, after copper and
    cobalt credits. For the Radio Hill disseminated ore, the
    C1-equivalent unit cost can be broken down into the following

    Underground Mining - US dollars per pound of nickel $0.65
    BioHeap(TM) Processing (including crushing and stacking) $0.58
    Other (administration etc) $0.13

    While the actual production costs of nickel using BioHeap(TM) will
    vary for different ore deposits and for different scales of
    operation, the results of this study are most encouraging and are
    consistent with Titan's, projections for BioHeap(TM) as a process
    with low capital and operating expenditures, and inherent technical
    and environmental advantages over conventional flotation and

    The mining and treatment of the Radio Hill disseminated
    mineralisation is projected to yield a modest cash surplus of around
    $5 million. At the nearby Mt Sholl open cut deposit, studies have
    shown that the optimised pit allows recovery of 1.2 million tonnes of
    ore at a grade, of 0.6% nickel with a waste-to-ore ratio of 10 to 1.
    The high mining costs at Mt Sholl and the low tonnage of ore at Radio
    Hill has meant that the combined projects do not meet Titan's
    required investment criteria at this time.

    Titan is continuing to drill out extensions to the Carr Boyd Rocks
    nickel sulphide deposit north of Kalgoorlie, and is well advanced in
    metallurgical (BioHeap(TM)) testing of fresh samples of Carr Boyd ore
    at AMMTEC in Perth. This first phase of RC and diamond drilling is
    scheduled for completion by the end of July.

    The objective of the program is to confirm and increase the tonnage
    of nickel mineralisation at Carr Boyd Rocks in preparation for its
    development as a BioHeap(TM) operation during 2003.

    For further information:

    Bill Ryan
    Telephone + 61 8 9481 6040
    Mobile + 041 7 172 923

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