Western Areas NL - Outstanding high grade nickel intersection at Spotted Quoll



    /THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR
    FOR DISSEMINATION IN THE U.S./

    ASX & TSX: WSA

    WEST PERTH, Western Australia, Jan. 21 /CNW/ - The Board of Western Areas
is pleased to announce the most recent drill hole at Spotted Quoll, WBD 28,
has intersected a wide zone of high grade massive sulphide at shallow depth.
Based on limited drilling results to date, Spotted Quoll is already showing
potential to become the Company's third nickel mine at Forrestania, after
Flying Fox and Diggers South.
    Preliminary analysis of the massive sulphide using a Niton portable XRF
analyser (see disclaimer) has resulted in an intersection of 8.6m at an
estimated average grade 7.8% nickel and 0.5% copper from 88.2m down hole
depth. The true width of the intersection is estimated to be 8m and occurs
within unoxidised, competent rocks. All 10 drill holes at Spotted Quoll to
date have intersected significant high grade nickel sulphides.
    The Company sees Spotted Quoll as an important development for three main
reasons:

    
    -   Due to the shallow depth and high grade of the mineralisation,
        potential exists to rapidly define a mineral resource to 200m depth
        and fast track the deposit towards early mine production, possibly by
        open pit (similar to Jubilee's Cosmos Mine).

    -   Spotted Quoll is on the same contact as Flying Fox and potential
        exists for a similar type deposit below the area drilled to date.
        (Western Areas has set a target to increase mineral resources at
        Flying Fox to 150,000 tonnes contained nickel in 2008).

    -   Spotted Quoll opens up the potential for additional discoveries along
        the 25km long Flying Fox contact. These may be associated with the
        flat lying granite intrusions that extend at least 6km from Flying
        Fox, below New Morning/Daybreak to Spotted Quoll.
    

    The intersection in WBD 28 is on a par with the best early nickel
intersections at the T1 ore body, in the upper part of the Flying Fox Mine. It
is 40m north of the discovery drill hole WBD 18 which intersected 6.2m @ 4.8%
nickel (including 3.6m @ 6.9% nickel) as matrix sulphides. Additional drilling
results from Spotted Quoll were released on 11 December 2007.
    The principal of Western Areas' geological consultants Newexco, Mr Adrian
Black, said "The Spotted Quoll results are very encouraging and confirm
excellent continuity of mineralisation along the 220m strike length tested to
date. The intersection in WBD 028 is one of the best massive sulphide
intersections I've seen at Forrestania to date."
    A second drill rig has arrived at Spotted Quoll to accelerate the
drilling program. Assay results from WBD 28 will be released as soon as they
are received and a longitudinal section showing location of all drill holes at
Spotted Quoll will be released when it is drafted.

    
    Drill hole coordinates:
    -------------------------------------------------------------------------
    Hole_ID    Collar Easting  Collar Northing  Dip/Azimuth of   End of hole
                      (GDA94)          (GDA94)      drill hole      depth (m)
    -------------------------------------------------------------------------
    WBD 28            751,630        6,403,500        -60/270       still in
                                                                    progress
    -------------------------------------------------------------------------
    

    DISCLAIMER:

    The estimates of nickel and copper grades for drill hole WBD 28 at
Spotted Quoll referred to in this release are based on multiple readings along
the massive sulphide intersection using a Niton XL3t portable XRF analyser.
While Western Areas believes the Niton estimates are indicative of the grades
of the intersection, the Company makes it clear that the Niton results are not
based on formal assays and are an estimate of nickel and copper grades only.
Formal assays for the intersection in WBD 28 will be released when they are
available.

    QA-QC STATEMENT:

    Mr Adrian Black from geological consultants Newexco Services Pty Ltd
("Newexco") is responsible for the verification and quality assurance of the
Company's exploration data and analytical results from the Forrestania Nickel
Project. Surface diamond drill hole collar surveys used differential GPS, down
hole surveys employed a north seeking gyroscopic instrument; comprehensive
density database; high assay confidence with systematic QA/QC procedures; and
validated database. Samples of quarter core from the drill holes described in
this release are prepared and analysed by ALS Chemex Ltd laboratory in Perth
for nickel, copper, cobalt and other elements. Core samples are crushed and
pulverised to 90% passing 75 microns then analysed for nickel by ore grade
determination using the ALS OG-62 method. Assays standards are routinely
inserted in the sample stream by Newexco for quality control.
    The information within this report as it relates to exploration results
or mineral resources is based on information compiled by Mr Julian Hanna. Mr
Hanna is a member of AusIMM and is a full time employee of the Company. Mr
Hanna has sufficient experience which is relevant to the style of
mineralisation and type of deposit under consideration and to the activity
which he is undertaking to qualify as a Competent Person as defined in the
2004 Edition of the 'Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves.' Mr Hanna consents to the inclusion in the
report of the matters based on the information in the form and context in
which it appears.

    FORWARD LOOKING STATEMENT:

    This release contains certain forward-looking statements. An example of a
forward looking statement in this release is: 'Spotted Quoll is already
showing potential to become the Company's third nickel mine at Forrestania'.
Forward-looking statements are subject to a variety of risks and uncertainties
beyond the Company's ability to control or predict which could cause actual
events or results to differ materially from those anticipated in such
forward-looking statements.
    This announcement does not include reference to all available information
on the Company or the Forrestania Nickel Project and should not be used in
isolation as a basis to invest in Western Areas. Any potential investors
should refer to Western Area's other public releases and statutory reports and
consult their professional advisers before considering investing in the
Company.
    For Purposes of Clause 3.4 (e) in Canadian instrument 43-101, the Company
warrants that Mineral Resources which are not Mineral Reserves do not have
demonstrated economic viability.





For further information:

For further information: Julian Hanna, Managing Director - Western Areas
NL, Telephone +61 8 9486 7855, Email: jhanna@westernareas.com.au; Craig
Oliver, Finance Director - Western Areas NL, Telephone +61 8 9486 7855, Email:
coliver@westernareas.com.au; Ann Nahajski, Investor Relations - Porter
Novelli, Telephone +61 8 9386 1233, Email: anahajski@wa.porternovelli.com.au;
Or visit: www.westernareas.com.au

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