TORONTO, ONTARIO--(Marketwire - March 30, 2011) - First Nickel Inc. ("First Nickel" or the "Company") (News - Market indicators) announces that it has filed with the Canadian securities regulatory authorities its audited financial statements, and management's discussion and analysis for the year ended December 31, 2010.

Complete results will also be available on SEDAR and on the Company's website at www.firstnickel.com. All dollar amounts are expressed in Canadian currency unless otherwise stated. 

• A net loss of $9.1 million was recorded in 2010. This compares to a net loss of $7.5 million recorded in 2009
• At December 31, 2010 the Company had a cash balance of $29.2 million
• During 2010, major progress was achieved toward becoming fully funded for capital and corporate needs and the Company is on track for first production in Q3 of 2011 and to produce at an annualized rate of 10 million pounds of nickel, and 7 million pounds of copper by mid-2012
• On September 1, 2010, the Company received a bridge loan of US$5 million from Resource Capital Fund IV L.P.
• In October 2010, the Company launched its re-commissioning capital program at the Lockerby Mine
• On November 12, 2010, the Company completed an equity issue for gross proceeds of $28.7 million
• In March 2011 the Company received the Commitment Letter from two banks for a $30 million secured project debt facility
• Ramping back to full production is expected to start in Q3 of 2011

For the year ended December 31, 2010 the Company recorded a net loss of $9,096,076, or $0.05 per share, compared to a net loss of $7,518,262, or $0.05 per share, recorded for the year ended December 31, 2009. The Company has recorded a full valuation allowance against any income tax assets for the year ended December 31, 2010 and 2009.

No sales revenue was recorded in 2010. The year ended December 31, 2009, includes only one month of sales revenue, as the Lockerby Mine, the only source of revenue for the Company, was placed on a care and maintenance program on October 19, 2008 following the deterioration in metals markets, and therefore only had one month of production available for settlement in 2009.

The emphasis in 2010 continued to be of containing site costs while ensuring plant and infrastructure were properly maintained, and complete the feasibility work necessary for securing financing. Care and maintenance costs of $5,138,684 recorded in 2010 include ongoing costs of the staff retained at the Lockerby mine site, energy, taxes, insurance, equipment rentals and materials required to maintain the mine. 

General and administrative expenses recorded in 2010 totaled $2,364,192. This is $74,715 (3%) higher than the $2,289,477 expenditures recorded in 2009. The increase is mostly attributable to higher consulting, legal and transfer agent fees.

Stock-based compensation costs for 2010 amounted to $173,596. In December of 2010, 6,800,000 stock options were granted to directors, officers and employees at an exercise price of $0.12. The fair value of the options granted was estimated at the grant date to be $468,155. Of this amount, $167,596 was expensed in 2010, with the balance amortized over the vesting period of the options. The Company uses the Black-Scholes pricing model in the valuations of the options.

An increase in the value of the Canadian dollar relative to the U.S. dollar during 2010 resulted in a foreign exchange gain of $394,619 being recorded in 2010. Exchange gains or losses arise from the revaluation of the US dollar cash balances, and the US dollar Convertible Loan account.

The interest on the loan facilities with RCF IV for the year ended December 31, 2010 amounted to $1,140,712 ($942,080 on the Convertible Loan and $198,632 on the Bridge Loan). RCF IV notified the Company of its option to receive Common Shares in payment of this interest. A total of 9,751,174 (6,691,693 in 2010 and 3,059,481 in 2011) Common Shares were issued to RCF IV in full satisfaction of this liability. 

Interest and other expenses of $17,718 recorded in 2010 include costs incurred on mineral properties that were previously written off, offset by a refund of interest on the flow-through funds (Part XII.6 tax).

Interest and other income is mostly made up of interest earned on cash balances, and on short term deposits. The lower interest income in 2010, compared to 2009, mainly reflects lower interest rates.

2011 Outlook

The Company is satisfied that it has a robust and well understood capital project at Lockerby, with the people to manage it, and the recent financing initiatives have placed the Company in far superior condition compared to a year ago. There is widespread industry support for the view that the commodities sector will remain strong, and the Company is confident that it is well-positioned to take advantage of this cycle and grow its business and asset base.

Qualified Person

The foregoing scientific and technical information has been prepared or reviewed by Paul C. Davis, P.Geo., Vice-President Exploration of the Company. Mr. Davis is a "qualified person" within the meaning of National Instrument 43-101.

The Company follows rigorous quality control practices and procedures in full compliance of NI 43-101, and these are described on the Company's website and in all technical press releases.

First Nickel is a Canadian mining and exploration Company, whose principal asset is the Lockerby Mine near Sudbury, Ontario. In addition to its Lockerby operation, the Company maintains an active exploration program on projects near the mine around Sudbury, and elsewhere in Ontario. First Nickel's shares are traded on the TSX under the symbol FNI.

This news release contains forward-looking statements, which are subject to certain risks, uncertainties and assumptions, including the cash flows, metal prices, decrease costs, increase output, expected production, and expected exploration expenditures. A number of factors could cause actual results to differ materially from the results discussed in such statements, and there is no assurance that actual results will be consistent with them. Such factors include fluctuating metal prices, lower unit costs and other factors described in the Company's most recent Annual Information Form under the heading "Risk Factors" which has been filed electronically by means of the System for Electronic Document Analysis and Retrieval ("SEDAR") located at www.sedar.com. Such forward-looking statements are made as at the date of this news release, and the company assumes no obligation to update or revise them, either publicly or otherwise, to reflect new events, information or circumstances, except as may be required under applicable securities law.