WSA announces: Significant T1 mineral resource upgrade lifts Flying Fox to 95,600 tonnes contained nickel at average grade of 6.2% nickel



    /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, Aug. 21 /CNW/ - The Board of Western Areas
is pleased to announce a significant upgrade in mineral resources for the T1
deposit at the Flying Fox mine. Drilling has confirmed that the previously
named T1 and T2 deposits form part of a 400m long, 150m high continuous high
grade zone cut by the dolerite dyke. The combined zone is now renamed "T1".
Total mineral resources at T1 contain approximately 21,000 tonnes nickel
indicated and 2,100 tonnes nickel inferred, a 25% increase in previous mineral
resources in this area of the mine.
    The revised T1 mineral resources listed below include previously
announced Probable Ore Reserves containing 15,400 tonnes nickel. A revised ore
reserve estimate for T1 is due to be released in September and is likely to
contribute to increased ore production and mine life at Flying Fox. First
production from T1 is expected early in the December quarter.
    The main decline has advanced at record rates and is now in the footwall
of the upper part of T1. Initial ore production from T1 will come from the
northern part of the ore reserve which includes previously released high grade
drill hole intersections including (down hole widths):

    
        17.2m @ 6.7% nickel
        11.7m @ 7.3% nickel
         6.6m @ 7.9% nickel
         8.2m @ 6.3% nickel
    

    Drilling is continuing at T1 with two recent drill holes outside the
revised mineral resource both reporting 1.2m intersections of massive
sulphides for which assays are awaited.
    The recent resource upgrade of T1 highlights the potential for further
significant extensions at Flying Fox in the underlying T4, T5, T6 and T7
sulphide zones.
    Drilling to test five recently announced T6 and T7 down hole EM
conductors at Flying Fox is expected to commence in early September. Drilling
of a down hole EM conductor in the footwall of the large Diggers South
disseminated nickel deposit is now in progress. Two additional diamond drill
rigs are being sourced to accelerate the Forrestania drilling programs.

    
    T1 Revised Mineral Resources ((greater than)1.5% nickel cutoff)

    -------------------------------------------------------------------------
                                       Contained
                                Grade    Nickel
    T1 Zone          Tonnes    Nickel %  Tonnes       Classification JORC
    -------------------------------------------------------------------------
    T1 South core   314,000      6.1     19,250   Indicated Mineral Resource
    -------------------------------------------------------------------------
    T1 South halo    86,800      1.9      1,690   Indicated Mineral Resource
    -------------------------------------------------------------------------
    T1 North         68,300      3.1      2,100    Inferred Mineral Resource
    -------------------------------------------------------------------------
    

    T1 Resource Parameters: Mineral Resource estimates were completed by Ms
Sharron Sylvester from Western Areas. Massive sulphide and disseminated
mineralisation were modelled as 3D solids. A block model was created using
"Datamine Studio" software, filling the solids with cells and sub-cells.
Geological continuity of mineralisation at Flying Fox T1 deposit is good with
respect to width and grade.
    Surface diamond drill hole collar surveys used differential GPS; downhole
surveys used a gyroscopic instrument; a comprehensive density database was
utilised; there is high assay confidence with systematic QA/QC procedures; a
validated acQuire database. An alternate inverse distance squared estimate was
made to validate the ordinary kriged resource. Validation of drillholes made
against block model grades.

    
    -------------------------------------------------------------------------
    Parameter                Details                          Comments
    -------------------------------------------------------------------------
    Cell Dimensions    5m (X) by 5m (Y) by 5m (Z)       Sub-celled to honour
                                                         boundaries
    -------------------------------------------------------------------------
    Interpolation      Ordinary Kriging                 Validated by ID2
     Method                                              estimate
    -------------------------------------------------------------------------
    Search Parameters  Three search passes:             Elliptical searches
                         - 40m by 40m by 20m
                         - 80m by 80m by 40m
                         - 120m by 120m by 60m
    -------------------------------------------------------------------------
    Drill hole         T1 South - 15m by 15m by 20m     Nominal
     spacing           T1 North - 20m by 20m by 25m
    -------------------------------------------------------------------------
    

    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, downhole 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 mineral resources and
mine development activities is based on information compiled by Ms Sharron
Sylvester and Mr Julian Hanna, both full time employees of Western Areas NL.
Ms Sylvester is a member of the AIG and Mr Hanna is a member of the AusIMM. Ms
Sylvester and Mr Hanna have sufficient experience which is relevant to the
style of mineralisation and type of deposit under consideration and to the
activity which they are undertaking to qualify as Competent Persons as defined
in the 2004 Edition of the 'Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves.' Ms Sylvester and Mr Hanna
consent 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. These 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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