Focus Minerals - Mine access approvals advance Nepean nickel project development

WA nickel and gold company Focus Minerals Ltd (ASX: FML) will fast track feasibility work targeting near-term development of the Company's wholly-owned Nepean Nickel Project near Coolgardie, Western Australia, following the receipt of access approvals to the historic Nepean Nickel Mine.

Granted by the Department of Consumer and Employment Protection, the access approvals will enable Focus Minerals to commence a full assessment of the historic Nepean underground workings, which were completed to a depth of 500m.

Focus Minerals is on schedule to commence underground mining at the Nepean Nickel Project in 2008. The Company has completed commissioning of the mine hoist and refurbishment of the mine shaft is underway.

Earlier this year, the Company upgraded the Nepean resource by 45% to 591,300t @ 2.2% Ni, following a re-assessment and re-modelling of transitional, fresh and remnant mineralisation at the mine. In addition to an appraisal of the condition of underground workings, the mine access approvals will enable Focus Minerals to confirm the extent of remnant ore blocks and extract ore samples for metallurgical testwork.

Drilling underway on the northern margins of the Nepean mine is targeting areas outside of the known remnant blocks where previously reported RC drilling intercepts were encountered. This may provide additional material for an underground operation.

The results will assist Focus Minerals' discussions with ASX-listed gold and nickel company, Ramelius Resources, regarding the potential to refurbish a dedicated nickel circuit at Ramelius' Burbanks plant, located 10km north of Nepean and currently operating exclusively as a gold processing facility.

The Nepean Nickel Mine produced 32,303 tonnes of nickel metal between 1970 and 1987 at a recovered grade of 2.99% nickel from 1.1Mt of ore. However, while centred on the historic mine, Focus Minerals' Nepean Nickel Project also incorporates a 30km strike length of Kambalda-style nickel sulphide mineralisation.

The Company has identified several new strong VTEM anomalies located within 1.5km south east of the mine. It is also planning follow up programs at four known sulphide prospects - Deano's, Priors, Tralee and Bouchers - identified from historical exploration conducted approximately 20km north of the mine.

"We are very enthusiastic about the potential scope of this project," Focus Minerals' Managing Director, Mr Peter Williams, said. "In addition to our near-term mine development and production plans, the Nepean Nickel Project offers long-term exploration upside."

"With full access to the existing Nepean mine, we will now move quickly to assess the extent of the remaining ore blocks and investigate the potential for further mineralisation," he added. "This will help advance our mine design work ahead of development scheduled to commence in April next year.

"Cash flow from production planned for later in the year will facilitate follow up assessments of some very strong anomalies we have identified from EM surveying close to the mine.

"We are most keen to commence drilling these recently identified anomalies and to further investigate our promising prospects further to the north.

"Despite the near-medium term program we have already outlined, the mine development, the anomalies and the prospects already identified form just a small proportion of the entire area covered by this project.

"We are very much looking forward to developing potentially the most significant nickel sulphide operation to date in the Coolgardie South area."

COMPETENT PERSON'S STATEMENT

The information in this report relating to Resources and Reserves are based on work supervised by Mr Chuck McCormick who is a Fellow of the Australasian Institute of Mining and Metallurgy (AusIMM). Mr McCormick has the relevant experience as a "Competent Person" as defined in the 2004 edition of the Australasian Code for Reporting of Mineral Resources and Ore Reserves in relation to the mineralisation reported on. Mr McCormick is Exploration Manager of Focus Minerals Ltd and consents to the inclusion of the material in the form and content in which it appears.

BACKGROUND INFORMATION - FOCUS MINERALS LIMITED

Focus Minerals Ltd (ASX: FML) is an Australian-based exploration and development group whose focus is to become a significant gold and nickel producer in the Coolgardie-Kalgoorlie-Widgiemooltha region of Western Australia.

Focus Minerals is fast tracking development of its wholly-owned Nepean Nickel Project (current estimated resource totaling 591,300t @ 2.2% Ni) located 25km south of Coolgardie. Focus is aiming to recommence mining operations from the historic production centre in 2008.

Through its Redemption Joint Venture with Canadian-based Committee Bay Resources Ltd, Focus Minerals is the largest landholder in the Coolgardie Gold Belt located in Western Australia, 560km east of Perth and 35km west of the ‘Super Pit' in Kalgoorlie-Boulder. More than 2.6 million ounces of gold has been produced from the Coolgardie gold belt alone since 1892. The Redemption Joint Venture holds the mineral rights to more than 210sq km of tenements including Measured, Indicated and Inferred Resources exceeding 1.6 million ounces of gold as well as the 1.2mtpa Three Mile Hill processing plant.