New Nickel Producer Fully Funded - On Track 1st Quarter 2008

    SYDNEY, Oct. 24 /CNW/ - Allegiance Mining (ASX Code: AGM) is pleased to
present its quarterly results ending 30th September 2007. Following are the
main points of what has been achieved. A full copy is available on the
Allegiance mining website.


    Construction is at full pace and production is scheduled to commence in
the 1st Quarter 2008.
    The project will mill 900,000 tonnes of ore producing 8,500 tonnes of
nickel ("Ni") in concentrates pa. The revised business plan currently extends
to June 2016 - to extend as resources expand. The Avebury nickel mine is fully
operational and has delivered.


    Hole P008 intersected 8 metres @ 1.0% Ni at the Foundation Stone Prospect
located 1.5 kilometres North of the Avebury Mine. This is the first ore-grade
intercept in the Pontiac Area to date. Drilling is extending Bintje & Bison
mineralisation. These results are not yet included in resources. Infill
drilling from an underground drill drive commenced in mid-May so as to
materially increase ore reserves by year-end, well ahead of production to
allow an early assessment of mill-mine expansion options. Orebody widths are
typically 10 metres to 40 metres in good ground conditions.


    At Melba Flats, Mining Lease ML 2M/2007 has been granted and drilling is
well underway.


    Cash balance of $37 million as at 12 October 2007. A$33.04 million share
placement funds from Jinchuan Nickel Group of China were received in early
July and a capital raising of A$30 million was completed by Merrill Lynch in
September. An A$73 loan facility has been signed with Allegiance's banks,
Société Générale and ANZ, comprising a US$45 million project finance facility
plus cost overrun and working capital facilities.


    US$3 billion offtake agreement with Jinchuan Nickel Group of China
remains a cornerstone agreement that brings major benefits to the Avebury
Nickel Project.
    Chairman, Tony Howland-Rose said, "In-fill drilling and exploration
drilling from the decline have progressed well and are ahead of schedule.
Three surface drillrigs have been active in the Avebury area and one surface
drillrig at Melba. The results at Melba appear encouraging, however assays are
awaited. At Avebury, I am particularly encouraged by the Foundation Stone
Intersection of 8m of 1% nickel, as this lies well to the North of what we
have regarded as the main Avebury horizon."
    David Deitz, Director said "we have been progressing towards production
and now that we are fully funded we are all looking forward to the revenue and
profits for the company and its shareholders over the coming year."

    Electronic copies of this and other reports are available on our website
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    A full copy of this announcement is available at

For further information:

For further information: David Deitz, +61 (02) 9397 7777 or +61 (0) 411
858 830

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