FNX Mining Company Inc.

FNX Mining Company Inc.

March 31, 2005 07:00 ET

FNX Announces Resources at the PM Deposit and Updates Phase 1 McCreedy West Reserves


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: FNX MINING COMPANY INC.

TSX, AMEX SYMBOL: FNX

MARCH 31, 2005 - 07:00 ET

FNX Announces Resources at the PM Deposit and Updates
Phase 1 McCreedy West Reserves

TORONTO, ONTARIO--(CCNMatthews - March 31, 2005) - FNX Mining Company
Inc. (TSX:FNX)(AMEX:FNX) announces updated mineral reserves for McCreedy
West Mine nickel deposits and mineral resources for the PM
copper-precious metal Deposit and the Levack Mine to December 31, 2004.
Production of approximately 340,000 tons of ore from Phase 1 mining at
McCreedy West Mine in 2003 and 2004 was replaced and mineral reserves
remain constant at 1.36 million tons, sufficient to support mining for
more than four years at the current mining rates. Mineral resources were
estimated for a portion of the PM Deposit, including the former 950
Deposit. Indicated mineral resources now total 2.8 million tons, while
Inferred mineral resources are 1.1 million tons. The PM mineral
resources remain open in all directions. Bulk sampling results from the
PM Deposit were encouraging and the west central portion of the deposit
is currently being developed for production scheduled later in 2005.
Mineral resources at the Levack Mine were updated as a result of surface
and underground drilling in 2004 on the 1300 Deposit, resulting in 4.9
million tons in the Measured and Indicated mineral resource categories
plus an additional 0.7 million tons of Inferred mineral resources.

McCreedy West Mine

Reserves

Probable mineral reserves for Phase 1 mining at McCreedy West Mine are
shown in Table 1. Nickel-rich, Probable reserves total 1.25 million tons
grading 1.8% Ni and 0.2% Cu, while the Probable copper-precious metal
reserves total 114,000 tons averaging 6.6% Cu, 0.8% Ni and 0.16 oz/t
TPM. Total Probable mineral reserves remained constant at 1.36 million
tons. The 2003-4 production tonnage was completely replaced and, going
forward, the intent is replace annual production with new mineral
reserves to maintain the Phase 1 mine life.

PM Deposit

Mineral Resources

Table 2 shows the initial mineral resource estimates for those portions
of the PM Deposit where data are sufficient to support resource
estimation. Indicated mineral resources total 2.8 million tons with an
average grade of 1.2% Cu, 0.3% Ni and 0.17 oz/t TPM, while Inferred
mineral resources of 1.1 million tons grade 1.1% Cu, 0.3% Ni and 0.21
oz/t TPM. The Indicated resources include 520,000 tons previously
reported for the Upper PM (950) area. Other mineralized areas of the PM
Deposit will be converted to mineral resources, once additional data are
collected. The west central portion of the PM Deposit, in the vicinity
of bulk sample area #1, is presently being developed in preparation for
limited production later in 2005 (see Figure 2). Once the preliminary
mining has determined the optimal mining approach to the PM Deposit, it
is anticipated that production from the PM Deposit will ramp up to at
least 1,000 tons per day.

PM Deposit

Bulk Sampling Results

The Sudbury Joint Venture is completing an exploration ramp and bulk
sampling program on the PM Deposit to increase confidence in the
drill-indicated grades and to provide metallurgical test samples. Figure
1 shows the location of the PM Deposit in relation to the McCreedy West
Mine underground workings and the Phase 1 orebodies. Figure 2 outlines
the trace of the ramp development through the PM Deposit and the bulk
sampling results. In addition to the first bulk sample results (See FNX
news release dated September 23, 2004), six additional bulk samples were
collected and the results are shown in the table in Figure 2. These bulk
samples varied in size from 659 up to 1,533 tons, while grades ranged
from 0.6%-1.4% Cu, 0.2%-0.3% Ni and 0.16-0.34 oz/t TPMs. The bulk
samples confirmed drill-indicated grades. These mineral resources remain
open for expansion in all directions.

Levack Mine

Mineral Resources

Based on the results from limited surface and underground drilling on
the unmined 1300, 1900 and No. 7 Extension Deposits, the Levack mineral
resources were also updated. The updated results are shown in Table 3.
Measured and Indicated mineral resources total 4.9 million undiluted
tons averaging 2.1% Ni and 1.0% Cu, while Inferred mineral resources are
0.7 million tons grading 2.0% Ni and 1.1% Cu. Portions of the mineral
resources for the 1300 Deposit were upgraded to the Indicated category
from the Inferred category based on new drilling. The updated resources
for the Levack Mine are undiluted, compared to the September 2003 press
release, which included 10% dilution at zero grade.

2005 Priorities

Nearly half of the 2005 Exploration Budget of $11.4 million is committed
to converting mineral resources to mineral reserves and defining
additional mineral resources. The recent footwall discovery will be
given the highest priority and additional budget will be made available,
if warranted. A priority will be to replace 2005 production for Phase 1
McCreedy West mineral reserves. Conversion of a portion of mineral
resources at the PM Deposit and Levack Mine into mineral reserves will
also be a focus in 2005, as will defining additional resources for the
PM Deposit.

Initially, all mineral resources are estimated in-house by FNX and
subsequently reviewed by Dynatec Corporation for conversion to reserves,
where appropriate. The final estimates for new reserves and resources
are then reviewed by Roscoe Postle and Associates, independent third
party consultants. All mineral reserves and resources conform to
NI-43-101 standards.

Sudbury Joint Venture - General

The Sudbury Joint Venture is owned 75% by FNX (exploration operator) and
25% by Dynatec (mining operator). The Sudbury Joint Venture properties
(McCreedy West, Levack, Victoria, Podolsky and Kirkwood) are all former
copper, nickel, platinum, palladium, gold producers. The properties are
located in the Sudbury District of northeastern Ontario and are covered
by previously announced agreements between FNX and Inco Limited (see
January 11, 2002 FNX press release) and FNX and Dynatec Corporation (see
February 3, 2002 FNX and DY press release). For a detailed description
of the properties and previous work, please go to the FNX website
"www.fnxmining.com" and refer to FNX's Annual Information Form dated
March 23, 2004.

James M. Patterson, Ph.D., P.Geo., and Vice President Exploration of
FNX, is the designated Qualified Person and responsible for the
verification and quality assurance of the Sudbury Joint Venture's
exploration data and analytical results. Anthony P. Makuch, M. Eng., P.
Eng., M.B.A., and Dynatec's Vice President, Sudbury Joint Venture Mining
Operations, oversees mining activities on behalf of the Sudbury Joint
Venture. Please see the July 16, 2003 FNX news release and the March 23,
2004 Annual Information Form for a description of sample preparation and
assay procedures for the Sudbury Joint Venture.

Forward looking statement

This press 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. In this news release,
forecast production, increases in mineral reserves and resources and any
future conversion of mineral resources to reserves are forward- looking
statements. Accordingly, readers should not place undue reliance on
forward-looking statements.



Table 1: McCreedy West Mine: Summary of Mineral Reserves.
(at December 31, 2004)
---------------------------------------------------------------------
Tons Ni Cu Pt Pd Au TPM
---------------------------------------------------------------------
Category (million) % oz/ton
---------------------------------------------------------------------
Probable Contact
Deposits 1.25 1.77 0.21
---------------------------------------------------------------------
Footwall
Deposits 0.11 0.76 6.55 0.05 0.07 0.04 0.16
---------------------------------------------------------------------
Total 1.36
---------------------------------------------------------------------


Table 2: PM Deposit: Summary of Mineral Resources
(at December 31, 2004)
---------------------------------------------------------------------
PM Deposit
---------------------------------------------------------------------
Tons Ni Cu Pt Pd Au TPM
---------------------------------------------------------------------
(million) % oz/ton
---------------------------------------------------------------------
Indicated Footwall
- PM Deposit 2.77 0.26 1.17 0.07 0.08 0.02 0.17
---------------------------------------------------------------------
Inferred 1.06 0.28 1.11 0.08 0.11 0.02 0.21
---------------------------------------------------------------------
- - - -
---------------------------------------------------------------------


Table 3: Levack Mine : Summary of Mineral Resources
(at December 31, 2004)
---------------------------------------------------------------------
---------------------------------------------------------------------
Tons Ni Cu Pt Pd Au TPM
---------------------------------------------------------------------
(million) % oz/ton
---------------------------------------------------------------------
Measured Contact
Deposits 2.41 2.11 1.07 - - - -
---------------------------------------------------------------------
Indicated Contact
Deposits 2.46 2.01 0.95 - - - -
---------------------------------------------------------------------
Total Contact
Deposits 4.87 2.06 1.01 - - - -
---------------------------------------------------------------------
Inferred Contact
Deposits 0.65 1.99 0.95 - - - -
---------------------------------------------------------------------


- Ni equals nickel; Cu equals copper; Pt equals platinum; Pd equals
palladium; Au equals gold, TPM equals Total Precious Metals defined as
Pt+Pd+Au

- The Indicated Mineral Resources are inclusive of those Mineral
Resources modified to produce the Mineral Reserves.

- Contact deposits resource estimates excluding the Levack 1900 Deposit
are based on 1% Ni cut-off grade and a minimum 8 ft true width. The
Levack 1900 Deposit estimate is based on a 1% Ni equivalent cut-off
grade. Nickel equivalency is based on estimates of long-term metal
prices of ($US): copper equals $0.80/lb., nickel equals $3.75/lb.,
platinum equals $525/oz., palladium equals $225/oz., Gold equals
$325/oz. and a Canadian dollar of US$0.67.

- The 700 Deposit resource estimate is based on 1.4% Ni equivalent cut
off grade and a minimum true mining width of 6 ft. or 7 ft., depending
on vein dip and includes internal and external mining dilution. The
Indicated resource are those blocks above C$83/ton NSR as based on the
700 Deposit Inco Off-Take Agreement metal accountability and the reserve
estimates of long term metal prices stated below

- The Upper PM (950) resource volume is based on a 0.75% Ni equivalent
cut-off grade and a minimum 8 ft true width. Nickel equivalency is based
on metal prices of ($US): copperequals $0.70/lb., nickel equals
$3.50/lb., platinum equals $600/oz., palladium equals $250/oz., Gold
equals $340/oz. and a Canadian dollar of US$0.67. The Indicated resource
are those blocks above C$87/ton NSR as based on the 700 Deposit Inco
Off-Take Agreement metal accountability. Resources for the PM Deposit
are based on a 0.058 oz/ton TPM cut-off.

- Reserves are the mineable economic portion of the Indicated resources.
All reserve estimates, cut-off grades and nickel equivalency are based
on estimates of long-term metal prices of ($US): Cu equals $0.78/lb., Ni
equals $3.95/lb., Pt equals $650/oz., Pd equals $185/oz., Au equals
$350/oz. and a Canadian dollar of U.S.$0.70. Contact deposit reserve
estimates include mining dilution at grades assumed to be zero and
include mining recovery of about 83%. Mining cut-off for reserves was
determined from net smelter return (NSR) based on the Inco Off-Take
Agreement metal accountability and feasibility study estimated mining
costs. Ni equivalent cut-off grades range from 1% to 1.4% depending on
mining method. The 700 Deposit reserve estimate is based on the fully
diluted resource and used the same NSR-mining cut-off approach as for
the contact deposits, which approximates a cut-off grade of 1.4% Ni
equivalent, with a recovery of 85%.

- oz/t equals ounces per short ton.

The Sudbury Joint Venture McCreedy West Mine PM Bulk Samples (Figure 1
and Figure 2) can be found by clicking the link below:
http://www2.ccnmatthews.com/database/fax/2000/fnx0331.pdf

-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    FNX Mining Company Inc.
    Terry MacGibbon
    President and CEO
    (416) 628-5922
    (416) 360-0550 (FAX)
    Email: tmacgibbon@fnxmining.com
    or
    FNX Mining Company Inc.
    David Constable
    Vice President, Investor Relations and Corporate Affairs
    (416) 628-5938
    (416) 360-0550 (FAX)
    Email: dwconstable@fnxmining.com
    www.fnxmining.com