WESTERN AREAS NL - ASX: WSA

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Description

Western Areas is an Australian-based nickel sulphide explorer and producer listed on the ASX and TSX (ASX & TSX Code: WSA). The Company's core asset is the 100% owned Forrestania Nickel Project, located 400km east of Perth.

The primary discovery at Forrestania, Flying Fox, is one of the highest grade nickel deposits in the world. Total Mineral Resources at Flying Fox comprise 2.0 million tonnes at an average grade of 6.2% (2.5Mt @ 5.5% for 125kNi including Lounge Lizard) nickel, containing approximately 125,640 tonnes of nickel. Western Areas' produced 8,000 tonnes of nickel in the 1st full year of production at Flying Fox.

The Company is also developing a number of other discoveries at the Forrestania Nickel Project.

The Spotted Quoll Open Pit Mine has been named the Tim King Pit, after Timothy King who was one of the founders and early directors of Western Areas. The Tim King Pit received final environment approval and formal Board approval during the September Q. Spotted Quoll (discovered October 2007) 6km South of Flying Fox. The Mineral Resources at Spotted Quoll comprises 2.0Mt at an average grade of 6.2%, containing approximately 125,460 tonnes nickel to 640m depth. The Open Pit is planned to be mined in two stages, development scheduled to commence in the September Quarter 2009 with first production targeted in the March Q 2010. Deep drilling is also underway at Spotted Quoll to test for extensions to the current mineral resource. Spotted Quoll already exceeds Flying Fox in size even though the current limit of drilling is only equivalent to the bottom of the Flying Fox T1 deposit.

At Cosmic Boy (planned third nickel mine) earth moving contractors MACA excavated the previous Outokumpu box cut. The current Mineral Resource is 180,900 tonnes at 2.8% nickel containing 5,000 tonnes of nickel. No further work was carried out at Cosmic Boy during the September Q. A scoping study to re enter the existing decline will be carried out in the second half of the year if the nickel price remains favourable.

Early site works for the underground mine at Diggers South (planned fourth nickel mine) comprising an evaporation pond, pipelines, waste dump and other surfaced infrastructure is almost complete. The initial surface infrastructure works at Diggers South were completed in Dec 2008 to enable an early start to access the Digger Rocks underground mine. The mine dewatering pumps were tested for four days. Clearing of a pipeline corridor from Cosmic Boy to Diggers Rock commenced. The pipeline is expected to be completed during the December Q, in parallel with the new pipeline from Spotted Quoll to Flying Fox. This work will complete the final section of the 40km long dewatering pipeline which will end at the Diggers South evaporation pond and is required to dewater the Spotted Quoll and Cosmic Boy mines. Operations are cash flow positive. From 2011 Western Areas is targeting an annual production of around 35,000 tonnes of nickel per annum, at the 100% owned Forrestania Nickel Project.

Priorities:

* Stage One ore production from the T1 orebody ~ Up to 8,000 tpa nickel
* Stage Two mine development of Flying Fox T5 deposit ~ Up to 13,500 tpa nickel
* Stage Three development of Flying Fox ~ Up to 20,000 tpa nickel
* Maiden nickel resource for Spotted Quoll – 30kt
* Cosmic Boy nickel concentrater ~ commissioned February 2009

Goals:

* Fast track development of Spotted Quoll
* A further 25% increase in Flying Fox resource to ~ 150,000 t of contained nickel
* A further 50% increase in Diggers South resource to ~ 150,000 t of contained nickel
* Discover of further new high grade massive sulphide deposits at Forrestania

Mine For

nickel, iron ore, copper, platinum, cobalt, zinc

Location of operation(s)

Western Australia, Canada, Finland

Address

Suite 3 , Level 1 , 11 Ventnor Ave
WEST PERTH, WA, AUSTRALIA

Phone

(08) 9334 7777

Email

Website

http://www.westernareas.com.au/

Last Updated

16/02/2010