WSA announces: Flying Fox mine production and drilling update new target of 150,000 tonnes nickel in mineral resources



    /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, Dec. 10 /CNW/ -

    Flying Fox T1 Production

    The Board of Western Areas is pleased to announce that the Flying Fox T1
ore body is already achieving forecast production rates and mine grades since
mining commenced on 14th November. T1 is ramping up to meet the initial target
to produce an average 20 tonnes nickel per day. The target for T1 is forecast
to increase to an average 30 tonnes of nickel in ore per day when T1 reaches
full production by mid 2008.
    5,850 tonnes of development ore at an estimated average grade of 5.0%
nickel have been mined from T1 up to 7th December. This grade compares
favourably to the 4.9% nickel ore reserve grade for this area of the mine. The
mine grade may increase further when the final grade is determined after the
ore has been treated. Approximately 6,500 tonnes of T1 ore plus 6,000 tonnes
of T Zero ore are currently stockpiled awaiting treatment by Norilsk.

    Flying Fox Mine Development

    Total mine development for November was a record 408m. The main decline
is advancing at an average of 6.4m per day and now extends over 3,000m from
surface to 450m vertical depth. The decline has already reached the second
development level at T1 where the massive sulphide ore is up to 10m true
width. The decline is operated by dedicated team separate from the mining
teams who are stoping ore at T Zero and T1 and establishing infrastructure in
the mine. The decline is on schedule to reach T4 within 12 months and T5
within 24 months.
    In addition, specialist engineering consultants RSV are due to report to
the Board by the end of December with preliminary results of a scoping study
to develop a shaft at Flying Fox. The concept of the shaft is to provide ore
haulage from the T5, T6 and T7 deposits with the aim of increasing production
from this deeper area of the mine. Drilling is ongoing at T4, T6 and T7.

    Flying Fox Drilling Update

    Drilling is continuing to produce excellent results in different areas of
the Flying Fox mine. As a result the Company has increased the target for high
grade nickel in mineral resources at Flying Fox from a total 100,000 tonnes to
150,000 tonnes contained nickel by the end of 2008. There are currently 95,600
tonnes of contained nickel at an average grade of 6.2% nickel defined in
mineral resources at Flying Fox. This excludes the T4, T6, and T7 deposits.

    
    T4:

    Two drill rigs are currently drilling at T4. The aim of this program is to
define the limits of the high grade mineralisation and estimate an Indicated
Mineral Resource as soon as possible.

      One drill rig is testing the southern part of the deposit where drill
      hole FFD 193W1W1 intersected 5.2m of massive sulphide (approximately
      50m north of the southern tenement boundary) and FFD193W2 intersected
      2.2m massive sulphide (30m north of tenement boundary). Assay results
      are awaited for FFD 193W1W1 and FFD193W2 however drilling is already
      underway to extend this new area of mineralisation.

      A second drill rig is testing the area immediately south of the
      dolerite dyke where recently announced intersections include 6.5m @
      6.5% nickel and 9.3m @ 5.1% nickel.

    T6 and T7:

    One drill rig is testing multiple massive, stringer and disseminated
sulphide zones associated with 5 interpreted down hole EM anomalies announced
previously. The current program is designed to define the geometry and extent
of the recently intersected sulphide zones associated with these EM targets.
The main purpose of the drilling is to evaluate the potential to add greater
than 50,000 tonnes nickel in mineral resource in this area of the Flying Fox
mine.

      A total of four drill holes (refer to Table 1) have been completed to
      date to test the T6, T6 (2), T6 Fault and T7 sulphide zones. All four
      drill holes intersected at least two significant zones of massive
      sulphides plus wide zones of disseminated sulphides overlying T6. Due
      to the extent of the EM targets and the potential for the
      mineralisation to be continuous with T5, a substantial amount of
      drilling is required up to 300m north and 200m above the area tested to
      date.

      Two of the four drill holes (FFD136W4 and FFD136W4W1W2) intersected
      significant massive sulphide intervals at T7. These intersections are
      near the southern limit of the T7 EM anomaly which is interpreted to
      extend (at least) 200m to the north. Drill holes FFD136W4W1 and
      FFD136W4W1W1 intersected footwall sediments below the T7 target. As a
      result, the strongest EM anomaly in this area (T7) remains largely
      untested. Further drilling is underway to test T7 north of the area of
      recent drilling.


    Table 1: T6, T6 (2), T6 Fault and T7 drill hole intersections:

    -------------------------------------------------------------------------
                                    T6 (2)        T6 Fault
                   T6 sulphide     sulphide       sulphide      T7 sulphide
                      zone -         zone -         zone -         zone -
    Hole_ID        intersection   intersection   intersection   intersection
    -------------------------------------------------------------------------
    FFD136W4       22.4m @     Not            3.6m @      7.3m @
                   1.1% Ni from   intersected    2.9% Ni from   3.3% Ni from
                   1397.5m                       1556.3m        1640.4m (incl
                                                                1.2m @
                                                                9.8% Ni
    -------------------------------------------------------------------------
    FFD136W4W1     1.6m @      1.1m @      0.8m @      drill hole
                   3.9% Ni from   2.7% Ni from   7.0% Ni from   passed below
                   1420.7m &      1482.1m        1525.8m        EM target
                   10.7m @
                   1.0% Ni from
                   1431.4m
    -------------------------------------------------------------------------
    FFD136W4W1W1   15.9m @     3.0m @      1.3m @      drill hole
                   1.6% Ni from   5.4% Ni from   2.3% Ni from   passed below
                   1434.0m (incl  1482.2m        1525.4m        EM target
                   3.4m @
                   2.6% Ni)
    -------------------------------------------------------------------------
    FFD136W4W1W2   22.7m          0.8m massive   3.0m matrix    9.6m massive
                   disseminated   from 1432.6m   from 1555.3m   and stringer
                   sulphide from  & 23.0m        & 0.9m matrix  from 1636.3m
                   1403.5m        disseminated   from 1546.4m   (assays
                   (assays        from 1433.5m   (assays        awaited)
                   awaited)       (assays        awaited)
                                  awaited)
    -------------------------------------------------------------------------
    

    Further details on the drill holes in Table 1 (including a detailed plan
of the T6 and T7 area showing the relative locations of each drill hole
intersection) will be released when assay results are available. Intersection
widths listed above are down hole depths.

    The full report with extended commentary can be viewed at the company
website www.westernareas.com.au.

    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. Examples of
forward looking statements in this release are 'final mine grade may increase
further when the head grade is determined after the ore has been treated' and
'extent of the EM targets and the potential for the mineralisation to be
continuous with T5.' 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 9334 7777, 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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