Focus Minerals Limited (ASX: FML)

COMMENCEMENT OF NEPEAN DRILLING PROGRAMME TO

UNDERPIN ONGOING FEASIBILITY STUDY

DRILLING TO FOLLOW UP ON RECENT HIGH GRADE NICKEL INTERCEPTS

?        Commencement of 30 hole drilling programme aimed at delineating extensions of newly defined, high grade, shallow nickel mineralisation at the Nepean Nickel Project

?        Focus to define and acquire metallurgical samples from newly discovered southern ore zone and extend and define northern extension of the 2 sill

?        Ongoing assessment of portal position for decline development to access remnant ore blocks to the 7 level

Australian gold and nickel company Focus Minerals Ltd (ASX: FML ? ?Focus?) is pleased to announce the commencement of a 30 hole drilling program at the Company?s Nepean Nickel Project, located in the historically nickel rich Kambalda-Widgiemooltha province. The programme will follow up on outstanding near-surface nickel intercepts including 3m @ 12.53% Ni , 1m @ 11.41% Ni, 6m @ 7.44% Ni and 3m @ 9.93% Ni recently announced as part of an ongoing Feasibility Study.

This latest round of drilling is designed to upgrade the ongoing Feasibility Study into the recommissioning of the mine - initially through the mining of remnant ore blocks and to assess the potential of a newly defined, high-grade shallow nickel resource. Previous drilling has confirmed extensions to the southern end of known remnant ore which will be accessible from the proposed portal position.

Given the potential that this newly defined ore body will enhance early cash flow, it is necessary that the planned portal position is modelled to intercept this lode. The ongoing Nepean Feasibility Study will incorporate the results from both the previous and current round of drilling. Further drilling success will substantially increase ore tonnage and significantly improve the economics of the project.

In addition, 6 further holes are planned to test the northern extension of the 2 Sill ore body beyond known remnant ore blocks. Previous successful sparse drilling and modelling of the 2 Sill ore body has indicated that it has a further 200 metres of strike length which would be accessible from the planned decline. If the 2 sill is successfully extended it would greatly enhance the planned mine life.

The Stage 2 Feasibility Study is focused on the development and mining of the upper level ore blocks in the Nepean Mine between the 2 and 7 level (between 60 metres and 220 metres vertical depth). Most of the mineable underground resource being used in the Feasibility Study is contained in the 2 Sill ore body, although the 3 Sill ore body also contains a substantial amount of ore which requires further evaluation.

Nepean is one of the last remaining nickel sulphide Komattites ore bodies in the region never to have been tested at depth. Successful depth extensions to similar styles of nickel sulphide mineralisation in the region including Mincor Resources Miitel and Wannaway mines along with the Western Areas? Flying Fox deposit, provides encouragement that the Nepean mine has excellent exploration potential at depth.

Nepean Overview

The Nepean Nickel Mine produced 32,303 tonnes of nickel metal from a shaft operation between 1970 and 1987 at a recovered grade of 2.99% Ni from 1.1 million tonnes of ore. Last year the Company upgraded the estimated Indicated Resource at Nepean by 45% to 591,300t @ 2.2% Ni, following a re-assessment and re-modelling of transitional, fresh and remnant mineralisation at the mine.

Trial mining at Nepean commenced earlier this year to extract remnant ore initially from the 6 Level (approximately 190 metres below surface) to provide information about mining conditions prior to commencement of a full-scale mining operation.

In addition to the historical mine, which remains open at depth, the Nepean tenement package incorporates a 30km strike length of Kambalda-style Komattites with significant nickel sulphide mineralisation potential.

Conclusion & Outlook

The phased development of the Nepean Nickel Mine represented a highly attractive, low capital cost entry for Focus to nickel sulphide production.

Commenting on the project, Focus Minerals? Managing Director Mr Peter Williams said ?The extraction of remnant resources to the 7 level will generate an attractive return while at the same time providing a platform for us to target prospective depth extensions.

?The fact that Nepean is one of the few nickel ore bodies in the region yet to be tested at depth is exciting given what has occurred at other geologically similar deposits, most notably the Flying Fox deposit operated by Western Areas, where extensive high-grade mineralization has been discovered at deeper levels of the structure,? he added.

ENDS

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