How To Develop The Talvivaara Project

(1)

This Prospectus comprises a Prospectus relating to Talvivaara Mining Company Ltd (the “Company”) and has been filed for approval with the Finnish Financial Supervision Authority (the “FFSA”). The Company has requested that the FFSA provide the competent authority in the United Kingdom, the United Kingdom’s Financial Services Authority (the “UK FSA”), with a certificate of approval attesting that the Prospectus has been drawn up in accordance with Finnish Securities Markets Act (26.5.1989/495, as amended), the decree issued by the Finnish Ministry of Finance on Listing Particulars under Chapter 2 of the Securities Markets Act (23.6.2005/452); European Commission Regulation (EC) No. 809/2004 (Annexes I and III); and related regulations which implement the Directive 2003/71/EC (the “Prospectus Directive”) in Finnish law; and the regulations and guidelines issued by the FFSA.

Application has been made to the UK FSA for all of the ordinary shares of the Company (the “Shares”), issued and to be issued in connection with the Offering, to be admitted to listing on the Official List of the UK FSA (the “Official List”) and to London Stock Exchange plc (the “London Stock Exchange”) for such Shares to be admitted to trading on the London Stock Exchange’s main market for listed securities (together, “First Admission”). Admission to trading on the London Stock Exchange’s main market for listed securities constitutes admission to trading on a regulated market. Conditional dealings in the Shares are expected to commence on the London Stock Exchange on 30 May 2007. It is expected that First Admission will become effective, and that unconditional dealings will commence in the Shares on the London Stock Exchange, at 8:00 a.m. (London time) on 1 June 2007. All dealings in the Shares prior to the commencement of unconditional dealings will be of no effect if First Admission does not take place and such dealings will be at the sole risk of the parties concerned.

Application has also been made to the UK FSA for a total 48,811,050 new Shares (the “Conversion Shares”) to be issued by the Company to the holders of (i) the 2006 Convertible Bonds (as defined herein) in connection with the conversion of the 2006 Convertible Bond into new Shares (the “2006 Conversion Shares”) and (ii) the 2005 Convertible Loan (as defined herein) in connection with the conversion of the 2005 Convertible Loan into new Shares (the “2005 Conversion Shares”) (the “Second Admission”). It is expected that Second Admission will become effective at 8:00 a.m. (London time) on or about 5 June 2007. The Company and the Directors (whose names appear on page 19 of this Prospectus) accept responsibility for the information contained in this Prospectus. Having taken all reasonable care to ensure that such is the case, the information contained in this Prospectus is, to the best knowledge of the Company and the Directors, in accordance with the facts and contains no omission likely to affect its import.

For a discussion of certain risk and other factors that should be considered in connection with an investment in the Shares, see “Risk Factors”.

Talvivaara Mining Company Ltd

(incorporated and registered in Finland with registered number 1847894-2)

Prospectus

Offering of 84,252,638 Shares at a price of 250 pence per Share(1) Admission to the Official List and to trading on the

London Stock Exchange

Sponsor, Financial Adviser, Sole Bookrunner and Lead Manager

JPMorgan Cazenove Limited

Co-Lead Manager

Nordea Bank Finland Plc

Expected number of Shares immediately following Second Admission

Authorised maximum share capital under

the Articles of Association Issued and outstanding

€1,000,000(2) _222,896,718

(1) Includes 10,921,939 Shares subscribed for by Outokumpu (the “Outokumpu Option Shares”) at a discount of 20 per cent. to the Offer

Price, amounting to a subscription price of 200 pence per Outokumpu Option Share and a total of 5,457,219 Capitalisation Shares (as defined herein).

(2) Under the Articles of Association of the Company, the Company’s Shares do not have nominal value.

The employees of the Company and its subsidiaries (the “Group”) in Finland will be given preference in the allocation of the Shares as part of the Offering. Each employee will be entitled to subscribe for a number of Shares corresponding to a maximum subscription amount of €15,000.

JPMorgan Cazenove Limited has been appointed as Sponsor, and is advising the Company and no one else in connection with the Offering and will not regard any person, other than the Company, as its client nor will it be responsible to anyone other than the Company for providing the protections afforded to its clients or for providing any advice in relation to the Offering.

(2)

This Prospectus has been prepared in accordance with the Finnish Securities Markets Act (495/1989, as amended); the decree issued by the Finnish Ministry of Finance on Listing Particulars under Chapter 2 of the Securities Markets Act (452/2005); European Commission Regulation (EC) No 809/2004, issued 29 April 2004 (Annexes I and III) and related regulations which implement the Prospectus Directive in Finnish law; and the regulations and guidelines issued by the FFSA. The FFSA has approved this Prospectus (journal number 28/250/2007), but is not responsible for correctness of any information herein.

The distribution of this Prospectus and the offer and sale of the Shares in certain jurisdictions may be restricted by law. Persons into whose possession this Prospectus comes are required by the Company, the Directors and the Managers named herein to inform themselves about and to observe any such restrictions. Prospective purchasers should read the restrictions described under paragraph 7 “Selling and Transfer Restrictions” in Part X: “The Offering”. No action has been or will be taken by the Company or the Managers (as defined herein) to permit a public offer in any jurisdiction or to permit the possession or distribution of this Prospectus (or any other offering or publicity materials relating to the Shares) in any jurisdiction where action for that purpose may be required. Accordingly, neither this Prospectus nor any advertisement nor any other offering material relating to the Shares may be distributed or published in any jurisdiction except under circumstances that will result in compliance with any applicable laws and regulations.

The Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the

“Securities Act”), or under the applicable securities laws of any state of the United States and may not be offered

or sold within the United States, unless registered under the Securities Act or an exemption thereunder is available. The Offering is being made outside the United States in reliance on Regulation S under the Securities Act. In addition, until 40 days after the commencement of the Offering, an offer or sale of any of the Shares within the United States by any dealer (whether or not participating in the Offering) may violate the registration requirements of the Securities Act.

Investors should rely only on the information in this Prospectus. No person has been authorised to give any information or to make any representations other than those contained in this Prospectus in connection with the Offering and, if given or made, such information or representations must not be relied upon as having been authorised by or on behalf of the Company, the Directors or the Managers. No representation or warranty, express or implied, is made by any Manager or selling agent as to the accuracy or completeness of such information, and nothing contained in this Prospectus is, or shall be relied upon as, a promise or representation by any Manager or selling agent as to the past, present or future. Without prejudice to any obligation of the Company to publish a supplementary prospectus pursuant to applicable rules and regulations, neither the delivery of this Prospectus nor any subscription or sale made under this Prospectus shall, under any circumstances, create any implication that there has been no change in the business or affairs of the Company or of the Group taken as a whole since the date hereof or that the information contained herein is correct as of any time subsequent to its date.

The contents of this Prospectus are not to be construed as legal, business or tax advice. Each prospective investor should consult his or her own lawyer, financial adviser or tax adviser for legal, financial or tax advice in relation to any purchase or proposed purchase of Shares. In making an investment decision, prospective investors must rely upon their own examination of the Company and the terms of this Prospectus, including the risks involved. None of the Company, the Directors or the Managers is making any representation to any offeree or purchaser of the Shares regarding the legality of an investment by such offeree or purchaser.

In connection with the Offering, the Managers and any of their affiliates, acting as investors for their own accounts, may take up Shares and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such Shares and other securities of the Company or related investments in connection with the Offering or otherwise. Accordingly, references in this Prospectus to the Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by the Managers and any of their affiliates acting as investors for their own accounts. The Managers do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

Apart from the responsibilities and liabilities, if any, which may be imposed on JPMorgan Cazenove Limited, J.P. Morgan Securities Ltd. (“JPMorgan”) and Nordea Bank Finland Plc (“Nordea”) by any applicable regulatory regime, none of JPMorgan Cazenove Limited, JPMorgan and Nordea accepts any responsibility whatsoever for the contents of this Prospectus or for any other statement made or purported to be made by it, or on its behalf, in connection with the Company, the Shares or the Offering. Each of JPMorgan Cazenove Limited, JPMorgan and Nordea, accordingly, disclaims, to the fullest extent permitted by applicable law, all and any liability whether arising in tort, contract or otherwise (save as referred to above) which it might otherwise have in respect of such document or any such statement.

(3)

SUMMARY INFORMATION

This summary should be read and construed solely as an introduction to the other information contained in this Prospectus. Any decision to invest in the Shares should be based on the consideration of this Prospectus as a whole by the investor and not just this summary. Following the implementation of the relevant provisions of the Prospectus Directive in each member state of the European Economic Area (“EEA”), civil liability attaches to those persons who are responsible for the summary, including any translations of the summary, but only if the summary is misleading, inaccurate or inconsistent when read together with other parts of this Prospectus. Where a claim relating to the information contained in this Prospectus is brought before a court, the plaintiff investor might, under the national legislation of the EEA States, have to bear the costs of translating the Prospectus before the legal proceedings are initiated.

Overview

The main activity of the Group is the development and exploitation of two polymetallic deposits, Kuusilampi and Kolmisoppi, in Sotkamo, Finland (together, the “Talvivaara Deposits”) using technology known as bioheapleaching (the “Talvivaara Project”). The Talvivaara Deposits comprise one of the largest known sulphide nickel resources in Europe with 266 million tonnes of ore in measured and indicated categories, sufficient to support anticipated production for a minimum of 24 years, starting in late 2008, with an annual nickel output of approximately 33,000 tonnes. In addition, the mine is also expected to produce zinc (approximately 60,000 tpa), copper (approximately 10,000 tpa) and cobalt (approximately 1,200 tpa) as by-products of the process. The rights to the Talvivaara Deposits are owned by the Talvivaara Project Ltd (the

“Subsidiary”), a company 80 per cent. owned by the Company.

Since acquiring the rights to mine the Talvivaara Deposits and the rights to use the related geological and bioheapleaching research data in February 2004, the Group has actively pursued the development of the Talvivaara Deposits and, on 23 March 2007, the board of directors of the Subsidiary approved a feasibility study, which contains detailed estimates of all material capital and operating expenditures expected to be incurred in connection with constructing and operating the mine (the “Bankable Feasibility Study”). The Group has also obtained an environmental permit and other material permits required for the commencement of mining operations. Further work on the Talvivaara Project will involve the development of the Talvivaara open pit mines, the construction of processing and ancillary infrastructure and the design, construction and commissioning of a processing facility. The Group is expecting to benefit from the proximity of the Talvivaara Project to existing energy and transportation infrastructure and potential customers.

The Group plans to supply metal intermediaries to companies with metal refining operations. Planned products are mixed nickel cobalt sulphide, zinc sulphide and copper sulphide. The Group has already entered into a 10-year off-take agreement with Norilsk Nickel Harjavalta Oy (“Norilsk Harjavalta”) for the entire output of the mine’s nickel and cobalt production at market prices (the “Off-take Agreement”).

The Group plans to develop the Talvivaara Deposits using technology known as bioheapleaching. This technology is already widely used for other metals, notably copper and gold. Bioheapleaching harnesses locally occurring, live bacteria for the extraction of metals from ore. In the leaching process, crushed and agglomerated ore is stacked in heaps, which are then irrigated with leach solution and aerated. During the last two years, the Group has demonstrated the viability of using bioheapleaching technology for the extraction of nickel in large on-site pilot trials using the Talvivaara ore. The trials have shown the leaching process to be heat generating and therefore suitable for the sub-arctic climatic conditions of Eastern Finland. Consequently, the bioheapleaching technology used by the Group is expected to enable commercial utilisation of the Talvivaara Deposits.

The Talvivaara orebody is well-suited for open pit mining due to thin overburden, favourable resource geometry and a low waste to ore ratio. The ore is relatively low grade (0.27 per cent. nickel), but well-suited to bioheapleaching due to its high sulphide content and its low pH, which enables rapid leaching with reduced need for chemical catalysis. The resources and reserves of the Talvivaara orebody as at 31 January 2007 are set out below. All mineral resources and ore reserves are stated for the Talvivaara Deposits as a whole and are not attributable with respect to ownership of the Subsidiary.

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Tonnage Grade

________ _________________________________________

(Mt) (Ni) (Co) (Cu) (Zn)

________ ________ ________ ________ ________ (%) Mineral resources(1) Measured . . . 124.0 0.27 0.02 0.15 0.55 Indicated. . . 142.3 0.27 0.02 0.14 0.55 Total . . . 266.3 0.27 0.02 0.14 0.55 Inferred. . . 70.8 0.24 0.02 0.13 0.53 –––––– –––––– –––––– –––––– –––––– Total . . . 337.1 0.26 0.02 0.14 0.55

––––––

Ore reserves Proved . . . 123.1 0.27 0.02 0.15 0.55 Probable . . . 134.0 0.26 0.02 0.14 0.54 –––––– –––––– –––––– –––––– –––––– Total . . . 257.2 0.27 0.02 0.14 0.54

––––––

(1) Resources are stated inclusive of reserves.

The Group’s headquarters are in Espoo, Finland. As at 31 December 2006, the Group had a total of 25 employees.

Key Strengths

The Directors believe that the Group’s key strengths are:

• The extensive sulphide nickel resource with a long mine life; • The favourable characteristics of the Talvivaara Deposits; • A cost-effective and scaleable bioheapleaching technology; • A favourable operational environment in Finland;

• An attractive commodity price outlook supported by current and projected trends; • A secured off-take agreement for nickel and cobalt at market prices; and

• A management team with extensive industry experience.

Strategy

The Company aims to become an internationally significant base metals producer with its primary focus on nickel and zinc, capable of achieving profit margins equal to or better than those achieved by comparable base metal mining companies. The key components of the Company’s strategy to achieve the above are: • Securing cost-effective exploitation of the Talvivaara Deposits using the bioheapleaching technology; • Capitalising on the potential for additional value creation through application of bioheapleaching

technology to other nickel resources;

• Growth through exploration of additional resources in Finland; and

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Summary of financial information

The table below provides summary of audited financial information on the Group as at and for the periods indicated. The information has been extracted from Part IX: “IFRS Historical Financial Information”. Investors should read the whole of this Prospectus and not rely solely on summarised information.

As at and for the years ended 31 December _____________________________________

2004(1) ₂₀₀₅ ₂₀₀₆

__________ __________ __________

(audited) (€) INCOME STATEMENT DATA

Other operating income . . . 57,438 101,780 218,016 Materials and services . . . (356,328) (1,514,402) (855,991) Employee benefit expenses . . . (78,215) (513,065) (1,393,822) Depreciation, amortization, depletion and

impairment charges . . . (2,516) (4,622) (13,003) Other operating expenses . . . (80,936) (343,503) (32,564,009) ––––––––– ––––––––– ––––––––– Operating loss . . . (460,557) (2,273,812) (34,608,809)

––––––––– ––––––––– ––––––––– Finance cost (net) . . . (467) (34,213) (3,235,135)

––––––––– ––––––––– ––––––––– Loss before income tax . . . (461,025) (2,308,024) (37,843,944) Income tax (expense)/income . . . – 1,109 178,447

––––––––– ––––––––– ––––––––– Loss for the year . . . (461,025) (2,306,915) (37,665,497)

–––––––––

BALANCE SHEET DATA ASSETS

Non-current assets

Property, plant and equipment . . . 14,738 39,376 3,959,629 Biological assets . . . – – 963,576 Intangible assets . . . 2,244,943 2,982,215 4,771,793 ––––––––– ––––––––– ––––––––– 2,259,681 3,021,591 9,694,998 ––––––––– ––––––––– ––––––––– Current assets Other receivables . . . 130,217 297,726 693,884 Available-for-sale financial assets . . . 150,440 851,543 22,537,285 Other financial assets at fair value through profit or loss . . . – – 5,039,726 Cash and cash equivalent . . . 32,868 62,834 1,784,055 ––––––––– ––––––––– ––––––––– 313,525 1,212,103 30,054,950 ––––––––– ––––––––– –––––––––

Total assets . . . 2,573,205 4,233,694 39,749,948

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As at 31 December _____________________________________ 2004(1) ₂₀₀₅ ₂₀₀₆ __________ __________ __________ (audited) (€) EQUITY AND LIABILITIES

Equity attributable to equity holders of the parent

Share capital . . . 10,885 12,715 12,715 Share premium . . . 409,590 2,755,433 2,755,433 Other reserves . . . 371 57,686 1,336,065 Retained earnings . . . 1,633,975 (672,941) (6,520,976) Minority interest in equity . . . – – 87,538 ––––––––– ––––––––– ––––––––– Total equity . . . 2,054,821 2,152,893 (2,329,225) ––––––––– ––––––––– ––––––––– Non-current liabilities Borrowings . . . 421,000 1,015,193 1,148,600 Other payables . . . 491 13,121 41,302 Deferred tax liabilities . . . 130 19,159 – Provisions . . . – 28,877 31,187 ––––––––– ––––––––– ––––––––– 421,621 1,076,350 1,221,089 ––––––––– ––––––––– ––––––––– Current liabilities Borrowings . . . – 300,000 38,601,940 Trade payables . . . 28,832 598,903 1,037,033 Other payables . . . 67,931 105,548 1,219,111 ––––––––– ––––––––– ––––––––– 96,763 1,004,451 40,858,084 ––––––––– ––––––––– ––––––––– Total liabilities . . . 518,384 2,080,801 42,079,173 ––––––––– ––––––––– –––––––––

Total equity and liabilities . . . 2,573,205 4,233,694 39,749,948

–––––––––

As at 31 December _____________________________________ 2004 2005 2006 __________ __________ __________ (unaudited) (%) KEY RATIOS

Debt to capitalisation ratio(2)_{. . . .} _16.4 _31.1 _100.2

Net debt to capitalisation ratio(3)_{. . . .} _9.2 _9.5 _26.2

(1) The financial period ended 31 December 2004 covers a 15-month period from 9 September 2003 to 31 December 2004. (2) In the ratio of debt to capitalisation, debt is defined as current borrowings plus non-current borrowings and capitalisation as total

liabilities plus total equity, excluding minority interest.

(3) In the ratio of net debt to capitalisation, net debt is defined as current borrowings plus non-current borrowings less any available-for-sale financial assets, other financial assets at fair value through profit and loss and cash and cash equivalents and capitalisation is defined as total liabilities plus total equity, excluding minority interest.

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Summary of the Offering

Under the Offering (including the Outokumpu Option Shares and the Capitalisation Shares), the Company will issue 84,252,638 Shares representing approximately £194.0 million (net of underwriting commissions and other estimated fees and expenses of approximately £11.2 million). The Shares to be issued under the Offering will represent approximately 37.8 per cent. of the issued and outstanding Shares of the Company immediately following Second Admission. The Offering is fully underwritten by JPMorgan and Nordea and is subject to satisfaction of the conditions set out in the Placing Agreement, including First Admission becoming effective and the Placing Agreement not having been terminated in accordance with its terms by 8:00 a.m. on 1 June 2007 or such later time and/or date as the Company and the JPMorgan Cazenove, JPMorgan and Nordea may agree (not being later than 1 July 2007).

The employees of the Group in Finland will be given preference in the allocation of the Shares as part of the Offering. Each employee will be entitled to subscribe for a number of Shares corresponding to a maximum amount of €15,000. The amount of Shares to be issued to the employees will based on the Offer Price and the euro/pounds sterling exchange rate on or about the day prior to the end of the Offering period.

First Admission is expected to take place and unconditional dealings in the Shares are expected to commence on the London Stock Exchange on 1 June 2007. Prior to that time, it is expected that dealings in the Shares will commence on a conditional basis on the London Stock Exchange on 30 May 2007 and that the earliest date for settlement of such dealings will be 1 June 2007. Second Admission is expected to take place on or about 5 June 2007. These times and dates are subject to change.

Use of proceeds

The Company’s net proceeds from the Offering (including the Outokumpu Option Shares but excluding the Capitalisation Shares), are anticipated to amount to £180.4 million after deduction of underwriting commissions and other estimated fees and expenses. The Company intends to use the net proceeds to fund, in part, its future capital expenditure programme to bring the Talvivaara Project into production. The Group intends to use the net proceeds primarily in the following way:

• Commencement of general mine site infrastructure, to include the construction of the main power distribution centre, purchase of transformers, and the construction of a substation;

• Preparation of the site, such as bedrock and soil excavation, installation of steel structures and cladding and the lining of the heap location with a drainage and blocking layer;

• Acquisition and/or leasing of mining equipment (such as crushers, stackers, conveyors, and other materials handling equipment);

• Installation of water management equipment, to include irrigation, ventilation and drainage equipment;

• Expenses related to the implementation and process engineering of the Talvivaara Project;

• Construction of the metals recovery plant, particularly to include the concrete works to prepare the location, the acquisition of a hydrogen sulphide plant, thickeners, piping, pumps, belt filters, reactors, storage tanks and conveyors; and

• General corporate purposes.

The net proceeds of the Offering (including the Outokumpu Option Shares but excluding the Capitalisation Shares) are not expected to fully fund the anticipated capital expenditure programme of the Group for the years 2007-2009 which is forecast to amount to approximately €451.8 million. The balance is to be funded by a U.S.$320 million Term Loan (as defined herein).

The Company is expected to pay approximately £11.2 million (€16.5 million) in non-recurring fees and expenses in connection with the Offering.

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Current trading and prospects

As at the date of this Prospectus, the Group has no history of, nor any current, revenue generating operations. However, the members of the Board of Directors of the Company (the “Directors”) believe that the Group is well-placed to commence commercial mining operations from the Talvivaara Deposits by the end of 2008.

Significant change

Except as disclosed elsewhere in this Prospectus, there has been no significant change in the financial or trading position of the Group since 31 December 2006, the date to which the financial information for the Group in Part IX: “IFRS Historical Financial Information”was prepared.

Dividend policy

The Shares offered in the Offering (including the Outokumpu Option Shares and the Capitalisation Shares) and the Conversion Shares will rank pari passuwith all outstanding Shares of the Company and will be entitled to any future dividends. The Directors do not anticipate the Company paying dividends in the near future. The Directors will reconsider the Company’s dividend policy as the Company advances the development of its operations. The Directors envisage that, at such time, the Company’s dividend policy will be determined and will depend on the following: the results of the Company’s operations; its financial condition; cash requirements; future prospects; profits available for distribution and other factors deemed to be relevant at the time. There can be no assurance that any dividend will actually be paid, nor can there be any assurance as to the amount that will be paid in any given year. See Part I: “Information on Talvivaara – Dividends and dividend policy”.

Risk factors

An investment in the Shares offered in the Offering involves a number of risks. The risks and uncertainties described in this Prospectus may not be the only ones facing the Group. Additional risks and uncertainties not presently known to the Group or that the Group currently deems immaterial may also impair the Group’s business operations. The business, financial condition or results of the operations of the Group could be materially and adversely affected by any of these risks. The trading price of the Shares could decline due to any of these risks and investors could lose part or all of their investment.

Risks relating to the Group’s business include risks common to the mining industry, risks relating to the development of the Talvivaara Deposits, risks related to the appeals on the environmental permit, estimates of reserves and resources, infrastructure risks, volatility of commodity prices, currency exchange risks, management and control systems, dependence on one asset, intellectual property rights, historical losses and uncertainties about the future profitability of the Group, risks relating to hedging, dependence on key personnel, effect of laws, governmental regulations and related costs, environmental hazards and risks related to the Group’s mining concessions. Risks relating to the Group’s structure and the Shares include risks relating to a major shareholder, absence of prior public trading, share price volatility, payment of dividends, future sales of the Shares, inability of certain shareholders to exercise pre-emptive rights and exercise of voting rights and other rights by holders of CREST Depository Interests (“CDIs”). These risks are described in more detail in “Risk Factors”.

Working capital

The Company is of the opinion that, given regard to its existing credit facilities, including the Term Loan facility, and taking into account the expected net proceeds from the Offering (including the issue of the Outokumpu Option Shares), the working capital available to the Group is sufficient for its present requirements, that is, for at least the next 12 months from the date of publication of this Prospectus.

Capitalisation and indebtedness

The Group’s capitalisation as at 31 December 2006 and 31 March 2007 was €43,854,753 and €46,229,552, respectively, and its net financial indebtedness as at 31 December 2006 and 31 March 2007 was €10,389,474 and €25,831,103, respectively.

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Board of Directors and Executive Committee

Directors G. Edward Haslam Non-Executive Chairman Pekka Perä Executive Director Saila Miettinen-Lähde Executive Director Graham Titcombe Non-Executive Director Eileen Carr Non-Executive Director Eero Niiva Non-Executive Director Antti Aaltonen Non-Executive Director Executive Committee Pekka Perä Chief Executive Officer Marja Riekkola-Vanhanen Chief Technology Officer Jouni Reino Chief Geologist

Saila Miettinen-Lähde Chief Financial Officer Pekka Erkinheimo Chief Commercial Officer Leif Rosenback Chief Metallurgist Tapio Hyödynmaa Chief Operations Officer

Relationship with the major shareholder

Immediately following Second Admission, Pekka Perä, the Chief Executive Officer of the Company, will beneficially own 27.1 per cent. of the issued and outstanding Shares of the Company. The relationship between Mr. Perä and the Company will be regulated by the Relationship Agreement, to ensure that the Company and the Subsidiary will be capable of carrying on their business independently of Mr. Perä, and that transactions and relationships with Mr. Perä are to be at arm’s length and on normal commercial terms. A summary of the Relationship Agreement can be found at paragraph 12.5 of Part XII: “Additional Information” of this Prospectus.

Lock-ups

The Company, the Directors and certain other shareholders have each agreed to enter into certain lock-up arrangements. Immediately following Second Admission, approximately 50.9 per cent. of the issued and outstanding Shares of the Company will be subject to lock-up agreements. A summary of the lock-up arrangements can be found at paragraph 12.6 of Part XII: “Additional Information” of this Prospectus.

Documents on display

Copies of this Prospectus, the Company’s Articles of Association, the decisions of the FFSA regarding this Prospectus, the Company’s audited consolidated historical financial statements as at 31 December 2004, 2005 and 2006 and for the 15-month period ended 31 December 2004 and the years ended 31 December 2005 and 2006, the reports prepared by PricewaterhouseCoopers Oy, the technical report by SRK Consulting (UK) Ltd. (“SRK”) and the letters of consent referred to in paragraph 17 of Part XII: “Additional Information” shall be on display during normal business hours at the offices of the Company located at Ahventie 4B 47, FI-02170 Espoo, Finland from the date of this Prospectus and for a period of at least one month following First Admission.

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RISK FACTORS

Investing in the Shares involves a high degree of risk. In addition to the other information contained in this Prospectus, prospective investors should consider carefully the specific risks set out below before making a decision to invest in the Shares. These risks and uncertainties may not be the only ones facing the Group. Additional risks and uncertainties not presently known to the Group or that the Group currently deems immaterial may also impair the Group’s business operations. Any of these risks could have a material adverse effect on the business, financial condition or results of the operations of the Group. The trading price of the Shares could decline due to any of these risks and investors could lose part or all of their investment.

Risks relating to the Group’s operations and industry

The business of mining

The Group’s primary business activity will involve mining of nickel, cobalt, zinc and copper. The mining business is subject to risks and hazards, including during the development phase, many of which are outside the Group’s control. These risks include, among others, environmental hazards (including discharge of metals, pollutants or hazardous chemicals), industrial and mechanical accidents, labour disruptions, fires, explosions, the encountering of unusual or unexpected geological formations, cave-ins, flooding, land-slides, power outage and periodic interruptions due to inclement weather conditions and these occurrences could result in damage to, or destruction of, mineral properties or production facilities, personal injury or death, environmental damage, reduced production and delays in mining, asset write-downs, monetary losses and possible legal liability. Although precautions to minimise the risks will be taken, even a combination of careful evaluation, experience and knowledge may not eliminate all of the risks and hazards.

Although the Group maintains insurance in an amount that it considers to be adequate, liabilities might exceed policy limits, in which event the Group could incur significant costs that could have a material adverse effect on the business, financial condition or results of operations of the Group. Insurance fully covering many environmental risks (including potential liability for pollution or other hazards as a result of disposal of waste products occurring from exploration and production) is not generally available to the Group or to other companies in the mining industry.

Project development risk

The Talvivaara Project is in the development stage and, therefore, the Group can give no assurances that the Talvivaara Deposits will be successfully exploited. Successful completion of the Talvivaara Project is subject to various factors, many of which are outside the Group’s control. These factors include, but are not limited to, the following:

• the granting of all consents and permits from the relevant government departments, all of which consents and permits may be appealed against and made subject to lengthy appeal proceedings; • the availability, terms, conditions and timing of acceptable arrangements for the construction of the

mining and processing facilities as well as other infrastructure required to complete the development of the Talvivaara Project;

• the actual development costs, which may exceed the Group’s estimates and for which significant additional financing may be required, and there can be no guarantee that the Group will be successful in obtaining any additional financing required or that the financing alternative chosen will be available on acceptable terms, or at all;

• the availability of and prices for certain raw materials, such as sulphuric acid, calcium compounds, cement, wood and steel used in the construction and development of the deposits and the processing of ore; and

• the ability to successfully scale-up the on-site pilot heap and use the bioheapleaching technology, which has not currently been commercially applied in full production scale.

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There can be no guarantee as to when the Talvivaara Project will be completed, whether the resulting operations will achieve the anticipated production volumes or whether the costs in developing the deposits will be in line with those anticipated. The Group’s inability to complete the project as planned could have a material adverse effect on the business, financial condition or results of operations of the Group.

Mining concessions

Under the laws of Finland, where the Talvivaara Deposits are located, government concessions are required to explore for and exploit mineral reserves. In February 2004, Outokumpu sold the exclusive rights to mine the Talvivaara Deposits to the Subsidiary and the title to the Talvivaara mining concessions was transferred to the Subsidiary on 14 May 2007. Under the laws of Finland, the mining concessions with respect to the Talvivaara Deposits may be terminated under certain limited circumstances. Termination of the Group’s mining concessions would have a material adverse effect on the Group’s business, results of operations or financial condition.

The Company has applied for an extension of the current mining concession area. Two appeals have been filed with the Finnish Supreme Administrative Court in an attempt to have the land surveying order issued by the Ministry of Trade and Industry on 3 October 2006 regarding the extension of the concession area revoked. The appeals were filed on 28 November 2006 and 30 November 2006 and are pending in the Supreme Administrative Court of Finland. Such appeals may delay the Talvivaara Project and there can be no certainty about the final outcome of such legal proceedings. In addition, SRK has noted in its report in Part XIV: “Mineral Expert’s Report” that some of the mining from the Talvivaara Deposits will need to be carried out outside the current concession boundaries. Whilst the reserves are included within the boundaries, the Group would need to extend the pit beyond the boundaries of the concessions to access them, which under Finnish law would require extension of the current mining concession. Should the appeals be successful and the Group not be granted the extension, the Group would need to start mining at Kolmisoppi approximately 18 months earlier than planned and the full life of the mine could be reduced by approximately two years.

Environmental permit

The Subsidiary received an environmental permit on 29 March 2007. The 30-day appeal period against the grant of the permit expired on 30 April 2007. Generally, any activities subject to an environmental permit must not be commenced before the permit decision has become legally binding and non-appealable. A decision becomes legally binding and non-appealable if there are no appeals on the decision or when the Supreme Administrative Court of Finland has ruled on the appeal. However, the applicable Finnish laws provide for a possibility to apply for a so-called “starting order”, which, if granted, allows the applicant to commence its activities regardless of the appeal on the permit. The Subsidiary received a starting order together with the environmental permit on 29 March 2007. Any appeal on the starting order was also to be made within the 30-day appeal period, but is processed on an accelerated timetable and must be decided without undue delay. The starting order allows the Group to commence construction activities by placing a security for the purpose of restoration of the environment.

A total of nine appeals were filed during the appeal period regarding the environmental permit, four of which also appealed against the granting of the starting order. Pursuant to the appeals, the appellants demand the revocation of the environmental permit or the amendment of the terms and conditions of the environmental permit. The Directors expect that the appeals on the starting order will be finally determined during the third quarter of 2007 and the appeals on the environmental permit within a year from the grant of the environmental permit. If successful, these appeals may delay the Talvivaara Project and there can be no certainty about the final outcome of any such legal proceedings. In the worst case, the revocation of the environmental permit would result in the Company’s inability to carry on mining operations on the site and the revocation of the starting order would oblige the Company to restore all the work that has been done at the site prior to the revocation of the starting order. The Directors consider it unlikely that either the starting order or the environmental permit would be revoked on the basis of the appeals made.

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Estimates of reserves and resources

The Group’s future performance will be affected by its ability to realise its estimated reserves base and convert existing resources into reserves. To ensure the commencement of the operations at the Talvivaara Project site and the realisation of the production levels of the deposits, it is essential that the Group will be able to carry out the above-mentioned actions.

The Group’s ore reserves and mineral resources described in this Prospectus constitute estimates that comply with standard evaluation methods generally used in the international mining industry and are stated in conformity with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the “JORC Code”). In respect of these estimates, no assurance can be given that the anticipated tonnages and grades will be achieved, that the indicated level of recovery will be realised or that ore reserves can be mined or processed profitably. Actual reserves may not conform to geological, metallurgical or other expectations, and the volume and grade of ore recovered may be below the estimated levels. In addition, there can be no assurance that mineral recoveries in smaller-scale tests will be duplicated during production. Lower market prices, increased production costs, reduced recovery rates and other factors may render the Group’s reserves uneconomic to exploit and may result in revision of its reserve estimates from time to time. Reserve data is not indicative of future results of operations. If the Group’s actual ore reserves and mineral resources are less than current estimates or if the Group fails to convert existing resources to reserves, this could have a material adverse effect on the business, financial condition or results of operations of the Group. Minerals exploration is highly speculative in nature, involves many risks and is frequently unsuccessful. There can be no assurance that the Group will be able to identify future reserves in Finland or elsewhere or to extend the estimated life of operations of the Talvivaara Deposits. Once mineralisation is discovered, it may take a number of years to complete the geological surveys to assess whether production is possible and, even if production is possible, the economic feasibility of production may change during that time. Any failure by the Group to identify and delineate ore reserves in the future could have a material adverse effect on its business, financial condition or results of operations of the Group.

Infrastructure risks

The Talvivaara Project is located in a remote sub-arctic area in Eastern Finland and the Group’s mining, processing, development and exploration activities as well as product delivery will rely on the infrastructure being adequate. The Group will depend upon trucking and rail to deliver sulphuric acid, calcium compounds, fuel, cement, steel and other supplies to its operations and to deliver its commodities to its customers. Disruptions of these transport services because of weather-related problems, key equipment failures, lock-outs or other events could temporarily impair the Group’s ability to receive supplies and, in the future, to supply its commodities to its customers, which could have a material and adverse effect on the business, financial condition or results of operations of the Group.

Volatility in commodity prices

The timing for the completion of the Talvivaara Project, the Group’s budget and any future revenues will depend on the market price for commodities, especially for nickel, zinc, cobalt and copper. If the prices were to decline substantially, it could threaten the economic viability of the Talvivaara Project or the benefit of developing the deposits at this stage. The market price of commodities has historically been subject to wide fluctuations and is affected by numerous factors beyond the Group’s control, including international economic and political conditions, levels of supply and demand, the availability and costs of substitutes, inventory levels maintained by producers and others, and actions of participants in the commodities markets. See Part IV: “Market and Industry Overview”.

Currency exchange risk

The Group’s revenues are expected to be almost entirely in U.S. dollars, whilst the majority of the Group’s costs, including capital expenditure, are incurred in euros. As a result, if the euro were to strengthen against the U.S. dollar, this could have a material adverse effect on the business, financial condition or results of operations of the Group.

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Risks Relating to Hedging

As a condition precedent for the initial utilisation of the Term Loan, the Subsidiary is required to enter into hedging transactions for such volume of zinc and nickel production, and such tenor, that in the opinion of the majority lender banks, will provide the level of economic protection set out in the Term Loan. Depending on the outcome of forward market prices, the Company might, in certain cases, be required to hedge a substantial portion of its forecast annual production. As a result, the Group may not be able to sell its entire production at spot market prices.

Management and control systems

The Group has a limited operating history and has only had operations since the beginning of 2004. As a result, it is subject to risks, expenses and uncertainties associated with implementing its business plan that are not typically encountered in more mature companies. Companies in a development phase face significant challenges in accurate financial planning as a result of limited historical data. The Company’s finance, treasury and accounting personnel currently consist of five persons. If the Company does not increase the finance, treasury and accounting staff as it continues to pursue its business plan, it may not be able to maintain an effective internal controls system or an internal audit function, which will hinder the ability to prepare reliable financial statements in the future. Any failure to take the necessary actions and any weaknesses in the operational and financial systems or managerial controls and procedures of the Group may impact the Group’s ability to implement the business plan and could have a material adverse effect on the business, financial condition or results of operations of the Group.

Dependence on one asset

The Group’s development activities currently concentrate on the Talvivaara Project. Should the development, or potential mineral production in the future, be materially reduced, interrupted or delayed, the business, financial condition or results of operations of the Group would be materially and adversely affected.

Dependence on key personnel

The Group’s business depends in significant part upon the contributions of a number of the Group’s key senior management and personnel, in particular its highly skilled team of engineers and geologists. There can be no certainty that the services of its key personnel will continue to be available to the Group. Factors critical to retaining the Group’s present staff and attracting additional highly qualified personnel include the Group’s ability to provide these individuals with competitive compensation arrangements.

A failure by the Group to retain or attract highly qualified individuals in key management positions as well as highly skilled engineers and geologists could have a material adverse effect on the business, financial condition or results of operations of the Group. It may be difficult for the Group to find or hire qualified people in the mining industry who are or will be situated in Finland or to obtain all of the necessary services or expertise locally or to conduct operations on its projects at reasonable rates. If qualified people and services or expertise cannot be obtained locally, those services will need to be obtained from people located elsewhere which will require work permits and compliance with applicable laws and could result in delays and higher costs to develop the Talvivaara Project.

Intellectual property rights

The Group does not currently have any registered intellectual property rights relating to the bioheapleaching technology. Should any rights that may be registered arise as a result of the Group’s operations, the Group will take actions that are necessary to protect such rights. In addition, although the bioheapleaching technology is a commonly used technology especially in the gold and copper mining industries, there can be no guarantee that the Group will not be subject to claims accusing that the bioheapleaching technology violates the intellectual property rights of third parties. Although the Directors believe that the technology used by the Group does not infringe intellectual property rights of any third parties, any claims of infringement may result in prolonged legal proceedings. If such a claim for infringement of third party intellectual property rights were made against the Group, it would most likely require the Group to divert significant management time and effort, which could adversely affect the Group’s business regardless of the outcome of the claim. Defending such litigation is costly, and if a final judgment of infringement is rendered

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against the Group, the Group could be required to pay substantial monetary damages and, unless it is able to obtain a license, it could become subject to substantial limitations or prohibitions regarding its right to use the disputed technology, or part of it, as a result of which the business, financial condition or results of operations of the Group would be materially and adversely affected.

Dependence on Norilsk Harjavalta

The Group has agreed to sell all its future nickel and cobalt production from the Talvivaara Deposits exclusively to Norilsk Harjavalta for ten years from the commencement of commercial production or when 300,000 tons, in the aggregate, have been delivered. If Norilsk Harjavalta was unexpectedly to terminate the sales agreement or it failed to abide by the sales agreement, no assurance can be given that delays or disruptions in sales would not be experienced until such time as alternative customers could be found, or that arrangements with alternative customers would be entered into on terms as favourable to the Group.

Losses and profitability

The Group has incurred losses of €461,025, €2,306,915 and €37,665,497 for the 15-month period ended 31 December 2004 and the years ended 31 December 2005 and 2006, respectively. It is expected that the Group will continue to incur significant losses unless and until such time as the Talvivaara Deposits enter into commercial production and generate sufficient revenues to fund continuing operations. There can be no assurance that the Group’s operations will ever become profitable.

Effect of laws, governmental regulations and related costs

The Group’s operations and exploration and development activities are subject to extensive laws and regulations governing various matters. These include laws and regulations relating to environmental protection, management and use of toxic substances and explosives, management of natural resources, exploration, development of mines, production and post-closure reclamation, exports, price controls, taxation, labour standards and occupational health and safety, including mine safety, and historic, cultural and wildlife preservation.

The costs associated with compliance with these laws and regulations are substantial and possible future laws and regulations, changes to existing laws and regulations (including the imposition of higher taxes and mining fees) or more stringent enforcement or restrictive interpretation of current laws and regulations by governmental authorities, could cause additional expense, capital expenditures, restrictions on or suspension of the Group’s operations and delays in the development of the Talvivaara Project. Moreover, these laws and regulations may allow governmental authorities and private parties to bring lawsuits based upon damages to property and injury to persons resulting from the environmental, health and safety impacts of the Group’s operations, and could lead to the imposition of substantial fines, penalties or other civil or criminal sanctions or damages.

Environmental hazards

Mining activities are generally subject to environmental hazards as a result of the processes and chemicals used in the extraction and production methods. In particular, the Group will employ bioheapleaching, which requires the Group to use sulphuric acid and hydrogen sulphide in the production process and elevated levels of naturally occurring radioactive materials, such as uranium, may be found in the Talvivaara Deposits. As a result of the high sulphide content of the Talvivaara ore, acid rock drainage may also occur. Therefore, environmental hazards may exist on the Group’s properties which are currently unknown to it or may arise irrespective of whether the Group is in compliance with current environmental regulations. The Group has not used bioheapleaching in large-scale production and there cannot be any guarantee that there will not be unexpected environmental hazards arising from the use of the technology.

The Group may be liable for losses associated with such hazards, or may be forced to undertake extensive remedial clean-up action or to pay for governmental remedial clean-up action, even in cases where such hazards have been caused by previous or subsequent owners or operators of the property, or by the past or present owners of adjacent properties or by natural conditions. Although the Directors believe the Group is in substantial compliance with applicable laws and regulations, they cannot guarantee that any such laws,

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regulations, enforcement or private claim will not have a material adverse effect on the business, financial condition or results of operations of the Group.

In addition, Finland is a signatory to, and has ratified, the Kyoto Protocol. The Kyoto Protocol is intended to limit or capture emissions of greenhouse gases such as carbon dioxide and methane. Whilst the precise nature of the revised environmental regulations and enforcement regime within these jurisdictions is yet to be finalised, compliance with new environmental requirements that may be enacted to ensure compliance with the Kyoto Protocol may require the Group to incur significant capital expenditure and failure to comply with any new legislation could result in the Group incurring fines and other penalties or increased costs and capital expenditure.

Risks relating to the Group’s structure

Relationship with major shareholders

Immediately following Second Admission, Mr. Perä, as described in paragraph 4 of Part XII: “Additional Information”, will beneficially own approximately 27.1 per cent. of the issued and outstanding Shares of the Company. As a result, in addition to his influence as the Chief Executive Officer, Mr. Perä will be able to exercise significant influence over all matters requiring shareholder approval, including the election of directors and approval of significant corporate transactions. The Company has entered into a relationship agreement with Mr. Perä to regulate his relationship with the Group, further details of which are contained in paragraph 12.5 of Part XII: “Additional Information” of this Prospectus.

The concentration of ownership may also have the effect of delaying or deterring a change in control of the Group, could deprive shareholders of an opportunity to receive a premium for their Shares as part of a sale of the Group and might affect the market price and liquidity of the Shares. Furthermore, although certain shareholders, including Mr. Perä, have agreed, not to dispose of Shares without the consent of the Managers and subject to certain exceptions, for a period between six months and two years from the date of this Prospectus, they may subsequently sell all or part of their holdings of Shares which may negatively affect the price of Shares. See paragraph 12.6 of Part XII: “Additional Information” of this Prospectus.

Enforcement of judgments and service of process

The Company is incorporated under the laws of Finland, and its assets are located outside the United Kingdom. Whilst the service of process in the United Kingdom upon and the enforcement of judgments obtained in the courts in the United Kingdom against the Company can nevertheless occur under Council Regulation (EC) No. 44/2001, there may be added logistical factors which could delay or complicate such service or enforcement.

Application of Finnish law

The Company is incorporated under the laws of Finland and the rights of shareholders are governed by Finnish company law and by the Company’s Articles of Association. These shareholder rights may differ from the typical rights of shareholders in the United Kingdom and other jurisdictions. In addition, the Company’s shares are not listed on any Finnish stock exchange and for this reason, certain investor protections afforded to shareholders of companies listed in Finland will not apply with respect to the Company.

Takeover regulation

The directive of the European Parliament and of the Council of the European Union (the “Council”) on takeover bids (the “Takeover Directive”) applies to all companies governed by the laws of an EEA member state of which all or some securities are admitted to trading on a regulated market in one or more member states. The laws of the member state in which the company has its registered office will determine what percentage of the voting rights in that company is regarded as conferring control over the company and the method of calculation of such percentage as well as employee information and company law matters. As the Company was incorporated under the laws of Finland, it is subject to Finnish law and the FFSA will be the supervisory authority with regard to these issues. However, as the Shares will be admitted to the Official List,

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there is dual jurisdiction as the UK Takeover Panel also has jurisdiction in respect of public takeover bids for the Company. The City Code will apply to the Company in respect of consideration and procedural matters.

Payment of dividends

To date, the Company has not paid any dividends to its shareholders. The payment of dividends by the Company is subject to the Group’s future financial position, distributable reserves, holding capital requirements, general economic conditions and other factors. Future dividends, if any, will depend, among other things, on the ability of the Subsidiary, and any future subsidiaries, to pay dividends or otherwise advance funds to the Company. Other contractual and legal restrictions may also impact the ability of the Company to receive funds from its subsidiaries.

Risks relating to the Shares

Absence of prior public trading

Prior to First Admission, there has been no public market for the Shares. The Company can give no assurance that an active trading market for the Shares will develop after First Admission or, if developed, can be sustained. If an active trading market is not developed or maintained, the liquidity and trading price of the Shares could be adversely affected.

Share price volatility

The Offer Price will be determined by negotiations between the Company and JPMorgan Cazenove and may bear no relationship to the price at which the Shares will trade upon or after First Admission. Publicly traded securities from time to time experience significant price and volume fluctuations that may be unrelated to the operating performance of the companies that have issued them. In addition, the market price of the Shares may prove to be highly volatile. The market price of the Shares may fluctuate significantly in response to a number of factors, many of which are beyond the Group’s control, including variations in operating results in the Group’s reporting periods; changes in financial estimates by securities analysts, changes in market valuation of similar companies; changes in the price or anticipated future price of nickel or other metals; announcements by the Group of significant contracts, acquisitions, strategic alliances, joint ventures or capital commitments; loss of a major customer; additions or departures of key personnel, any shortfall in revenues or net income or any increase in losses from levels expected by securities analysts, future issues or sales of Shares, and stock market price and volume fluctuations. Any of these events could result in a material adverse effect on the market price of the Shares.

Future sales of Shares

The Group is unable to predict whether substantial amounts of Shares will be sold in the open market following the termination of the lock-up restrictions put in place in connection with the Offering. Further details of the lock-up restrictions are contained in Part X: “The Offering” of this Prospectus. Any sales of substantial amounts of Shares in the public market, or the perception that such sales might occur, could result in a material adverse effect on the market price of the Shares.

Inability of certain shareholders to exercise pre-emptive rights

Certain holders of the Shares resident in, or with a registered address in, certain jurisdictions other than Finland and the United Kingdom, may not be able to exercise their pre-emptive rights in respect of the Shares they hold in any future offerings unless a registration statement, or the equivalent thereof under the applicable laws of their respective jurisdictions, is effective with respect to such Shares, or an exemption from any registration or similar requirements under the applicable laws of their respective jurisdictions is available.

Exercise of voting rights and other rights by holders of CDIs

The rights of holders of CDIs will be governed by arrangements between CREST, Finnish Central Securities Depository Ltd (“FCSD”) and the Company. These rights are different from those of holders of Shares, including with respect to receipt of information, the receipt of dividends or other distributions, the exercise

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of voting rights and attending shareholders’ meetings. As a result, it may be more difficult for CDI holders to exercise those rights.

In particular, due to Finnish legal restrictions on exercising voting rights attaching to shares held through a nominee, shareholders who hold their Shares in the form of CDIs may find it more difficult to exercise their voting rights than shareholders who hold their Shares in an individual account in the Finnish book-entry system. However, holders of CDIs will have the ability to register as shareholders on a temporary basis in order to attend and/or vote at general meetings. For a discussion of voting procedures, please see Part XIII:

“Summary of Certain Provisions of the Finnish Companies Act and the Articles of Association – General Meetings of Shareholders – Attendance and Voting”of this Prospectus.

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DIRECTORS, SECRETARY, REGISTERED AND HEAD OFFICE

Members of the Board of Directors G. Edward Haslam Non-Executive Chairman

Pekka Perä Executive Director Saila Miettinen-Lähde Executive Director Graham Titcombe Non-Executive Director Eileen Carr Non-Executive Director Eero Niiva Non-Executive Director Antti Aaltonen Non-Executive Director

Company Secretary Pekka Erkinheimo

Registered Office Ahventie 4 B 47

FI-02170 Espoo Finland Ahventie 4 B 47 FI-02170 Espoo Finland

ADVISERS

Financial Adviser JPMorgan Cazenove Limited

20 Moorgate London EC2R 6DA United Kingdom

JPMorgan Cazenove Limited 20 Moorgate

London EC2R 6DA United Kingdom

Co-Lead Manager Nordea Bank Finland Plc

Satamaradankatu 5 FI-00020 NORDEA Finland

White & Case LLP

5 Old Broad Street Eteläranta 14 London EC2N 1DW FI-00130 Helsinki United Kingdom Finland

Jones Day 21 Tudor Street London EC4Y 0DJ United Kingdom

Auditors and Reporting Accountants PricewaterhouseCoopers Oy

Itämerentori 2 FI-00101 Helsinki Finland

Technical Consultant SRK Consulting (UK) Ltd.

Floor 5

Churchill House Churchill Way Cardiff CF10 3HH United Kingdom

Registrar Computershare Investor Services (Channel Islands) Limited

Finnish Account Operator Nordea

Legal Adviser to the Financial Advisor as to English law

Legal Adviser to Company as to English law and Finnish law Sponsor, Global Co-ordinator and

Bookrunner

Head Office and Directors’ Business Address

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OFFERING STATISTICS

Offer Price (per Share) 250 pence

Subscription price for the Outokumpu Option Shares 200 pence Number of Shares being offered in the Offering(1) _84,252,638

Percentage of the enlarged issued shares being offered in the Offering(1) _37.8%

Number of Shares in issue following Second Admission 222,896,718 Market capitalisation of the Company at the Offer Price £557.24 million Estimated net proceeds of the Offering receivable by the Company(2) _{£180.4 million}

(1) Including the issue of the Outokumpu Option Shares and the Capitalisation Shares.

(2) Net proceeds receivable by the Company are stated including the Outokumpu Option Shares but excluding the Capitalisation Shares and after deduction of underwriting commissions and estimated expenses of the Offering of approximately £11.2 million.

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

First Admission becomes effective and commencement of dealings in Shares

expected to commence on the London Stock Exchange 1 June 2007 Second Admission becomes effective 8.00 a.m. (London time) on 5 June 2007 Crediting of the Shares offered in the Offering to CREST accounts 8.00 a.m. (London time) on 1 June 2007 Crediting of the Conversion Shares to CREST accounts 8.00 a.m. (London time) on 5 June 2007 Each of the times and dates in the above timetable is subject to change.

It should be noted that, if First Admission does not occur, all conditional dealings will be of no effect and any such dealings will be at the sole risk of the parties concerned.

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PRESENTATION OF INFORMATION

Presentation of financial information

Unless otherwise indicated, financial information in this Prospectus has been prepared in accordance with IFRS. The financial information contained in Part IX: “IFRS Historical Financial Information” as at 31 December 2004, 2005 and 2006 for the 15-month period ended 31 December 2004 and for the years ended 31 December 2005 and 2006 has been audited. The Company was incorporated in August 2003 and commenced business activities in April 2004. The comparability of the information for the period ended 31 December 2004 is affected by the fact that the period to 31 December 2004 started on 9 September 2003. All references to the financial year ended 31 December 2004 refer to a 15-month period from 9 September 2003 to 31 December 2004. All unaudited financial information in this Prospectus has been extracted without material adjustment from the Group’s accounting records.

Certain amounts and percentages included in this Prospectus have been rounded.

Currencies

In this Prospectus, (i) references to “euro” or “€” are to the single currency of the participating Member States in the Third Stage of the European Economic and Monetary Union pursuant to the Treaty establishing the European Community, (ii) references to “pounds sterling”, “£”, “pence” or “p” are to the lawful currency of the United Kingdom and (iii) references to “U.S.$” or “U.S. dollar” are to the lawful currency of the United States.

The Company presents its consolidated financial information in euro. Unless otherwise indicated, the financial information contained in this Prospectus has been expressed in euro.

The Offer Price is stated in pounds sterling. Unless otherwise indicated, the euro/pounds sterling exchange rate applicable to amounts stated in this Prospectus is €1.00 = £0.6783, being the applicable rate on 25 May 2007 (being the latest practicable date prior to the publication of this Prospectus), based on the rate published by the Bank of England.

The following table sets out, for the periods and dates indicated, the average, high, low, and period-end reference rates as published by the European Central Bank for pounds sterling per €1.00. The average rate means the daily average of the exchange rates during the applicable period.

Reference rates of pounds sterling per euro ________________________________________________

Average High Low Period-End

_______ ______ ______ __________ 2003 . . . 0.6919 0.7235 0.6495 0.7048 2004 . . . 0.6786 0.7088 0.6556 0.7051 2005 . . . 0.6839 0.7073 0.6624 0.6853 2006 . . . 0.6818 0.7006 0.6680 0.6715 2007 (through 25 May) . . . 0.6774 0.6854 0.6549 0.6775 The above rates are provided solely for the convenience of the reader and are not necessarily the rates used in the preparation of the Group’s consolidated financial information. No representation is made that pounds sterling could have been converted into euro at the rates shown or at any other rate for such periods or at such dates.

Ore reserve and mineral resource reporting – basis of preparation

SRK has reviewed the reserves and resources statements compiled by the Company and has stated the reserves and resources as set out in Part XIV: “Mineral Experts’ Report” of this Prospectus in compliance with the Prospectus Rules and the recommendations of the Committee of the European Securities Regulators (“CESR”) and in accordance with the criteria for reporting reserves and resources as set out in the JORC Code. In this Prospectus, all reserve and resource estimates initially prepared by the Group have been substantiated by evidence obtained from SRK’s site visits and observation and are supported by details of

How To Develop The Talvivaara Project

Talvivaara Mining Company Ltd

Prospectus

JPMorgan Cazenove Limited

Nordea Bank Finland Plc

TABLE OF CONTENTS

SUMMARY INFORMATION

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RISK FACTORS

DIRECTORS, SECRETARY, REGISTERED AND HEAD OFFICE

ADVISERS

OFFERING STATISTICS

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

PRESENTATION OF INFORMATION