Western Areas NL: Outstanding Results Below Flying Fox & Spotted Quoll Mines

PERTH, AUSTRALIA--(Marketwire - Oct. 18, 2011) -

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

Western Areas (TSX:WSA)(ASX:WSA) is pleased to provide an update on a number of positive results from below the Flying Fox and Spotted Quoll mines and across a range of other projects. Western Areas Managing Director, Mr Julian Hanna, said that the results demonstrate the quality of the exploration portfolio.

"It is encouraging to see positive results from below our currently operating mines at Flying Fox and Spotted Quoll, and also from three other projects in Australia, Canada and Finland," said Mr Hanna.

Flying Fox & Spotted Quoll

Assay results have now been received for a significant width of massive sulphides intersected in the T6 deposit, below the Flying Fox mine, with drill hole FUG692 intersecting 34.7m at an average grade of 8.9% nickel. The intersection in FUG692 has an interpreted true width of 9m. Preliminary results from FUG692 gave an estimated grade of 7% nickel and were announced on 5^th October.

The intersection in T6 indicates potential for substantial extensions to high grade mineralisation below Flying Fox, outside current mineral resources and ore reserves. Drilling is ongoing with the aim of defining an initial Mineral Resource in this area below the current mine.

Drilling at Spotted Quoll mine is producing significant results well below the Stage One underground mine where development is in progress. Recent results include drill hole WBD181W2W2W2 which intersected 3.3m at an average grade of 8.3% nickel from 1088m down hole depth. An initial Mineral Resource for Stage Two is expected to be completed in the December quarter.

Joint Venture Projects

Recent exploration has produced a number of very encouraging early results from three exploration joint venture projects in Australia, Canada and Finland. The following projects are currently being drilled or are planned to be drilled in the December quarter:

1. Mt Gibb JV (WSA earning 70% from Great Western Exploration Ltd)

Western Areas is conducting a diamond drilling program to test six EM anomalies located approximately 25km south of Western Areas' proposed Diggers South nickel mine at Forrestania.

The second drill hole in this program intersected a 1.5m interval with multiple veins of massive sulphide with nickel grades up to 5.1% nickel (estimated using a portable XRF Niton analyser). The nickel mineralisation appears to be remobilised into a sheared basalt host. It is unclear if this sulphide is the source of the EM anomaly and a down hole EM survey will be carried out to identify conductors in the area. Formal assays are required to confirm the nickel grades and drilling is ongoing.

2. East Bull Lake JV, Canada (Western Areas earning 65% from Mustang Minerals)

Western Areas recently completed an airborne geophysical survey (utilising the ZTEM method) over the 20km long East Bull lake mafic intrusive complex, 80km west of Sudbury in Ontario. Previous surface sampling and widely spaced drilling has intersected significant, sulphide hosted nickel, copper and PGM mineralisation at shallow depth around the perimeter of the western and eastern intrusions (refer to June Q 2011 report and previous Western Areas' and Mustang Minerals Corp releases).

Preliminary interpretation of the data has defined several large ZTEM responses extending from approximately 300m and 1500m depth. These responses may represent conductive geological contacts at the base of the western and eastern intrusions. Drilling is planned to test these targets starting in the December quarter, as soon as access to the drill sites is finalised.

Western Areas considers this project has exciting potential for nickel, copper and PGM deposits.

3. FinnAust Projects, Finland (WSA 79%)

Drilling is in progress at the Paltamo Project, 120 km north of FinnAust's Rautavarra R1 deposit. Recent, widely spaced drilling at the Paltamo P5 prospect intersected significant widths (150m to 200m wide) of mineralised sulphidic black schist. Preliminary analysis, using a portable XRF analyser (Niton), has defined two zones of mineralisation with anomalous base metal values in drill holes at P5.

These zones are:

• upper Zinc/Nickel/Copper zone up to 120m downhole width
• lower Manganese/Zinc zone (to 4.5% manganese) up to 80m downhole width.

Assays are awaited to confirm the tenor of the mineralisation at Paltamo. The extent and significance of the mineralisation is not known at this stage. A revised Mineral Resource estimate for the Rautavaara R1 deposit is expected to be announced in the December quarter.

Drilling is also planned to test a number of priority nickel and copper targets in the Outokumpu and Tormala Projects approximately 200km south of Paltamo. At Tormala, drilling will follow up a number of significant nickel/copper intersections within a large, interpreted gabbro intrusion. Drilling is expected to commence when approvals have been received from landholders in the area.

COMPETENT PERSONS STATEMENT:

The information within this report as it relates to nickel concentrate sales estimates is based on information compiled by Mr Charles Wilkinson and Mr Julian Hanna of Western Areas NL. Mr Wilkinson and Mr Hanna are members of AusIMM and are full time employees of the Company. Mr Wilkinson 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.' Mr Wilkinson 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 include: "The intersection in T6 indicates potential for significant extensions to high grade mineralization below Flying Fox, outside current mineral resources and ore reserves", and, "exploration has also produced a number of very encouraging early results from a range of exploration joint venture projects in Australia, Canada and Finland", and, "Preliminary interpretation of the data has defined several large ZTEM responses extending from approx 300m and 1500m depth", and, "Drilling is planned to test these targets starting in the December quarter", and, "Western Areas considers this project has exciting potential for nickel, copper and PGM deposits." 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.

DISCLAIMER:

This announcement does not include reference to all available information on the Company or the Forrestania Nickel Project, or the Mt Gibb JV, or the East Bull Lake JV, or the FinnAust Projects and should not be used in isolation as a basis to invest in Western Areas or FinnAust. 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.