Falconbridge, Agnico-Eagle Announce Supply Agreement

Falconbridge Ltd. and Agnico-Eagle Ltd. have signed a life-of- mine zinc concentrate supply and processing agreement.

The agreement calls for Falconbridge's Kidd Creek operations in Timmins, Ontario to process 60-75 percent, up to a maximum of 125,000 metric tons per year, of the precious-metal-bearing zinc concentrate production from the LaRonde mine in Quebec.

The domestic treatment of LaRonde zinc concentrates will improve the overall operating economics at both LaRonde and the Kidd Metsite through the sharing of freight savings. Additional benefits are derived through the improvement in capacity use and precious metal recovery at Kidd Creek. Falconbridge will retrofit the Kidd refinery in order to establish its capability to recover precious metals.

"The proximity of Falconbridge's and Agnico-Eagle's operations, combined with Kidd's available zinc capacity and precious-metal recovery capabilities, make this agreement a natural fit for both companies," said Brent Chertow, president of Falconbridge's Canadian Copper and Recycling business.

Zinc production capacity at the Falconbridge Kidd Metsite is 140,000 metric tons per year. The balance of the zinc concentrate requirements will be provided by the Kidd Mine, which currently completing its Mine D expansion.